On the recovery path

 

Penang property market to rebound amid lingering challenges

`
THE Penang property market, which had actually started seeing a rebound in transactions since last year, is expected to resume its recovery path into 2022.
`
CBRE|WTW director Peh Seng Yee says the Penang property market can expect a “rebound amid lingering challenges” this year.
`
“We do expect a recovery in market activity for 2022. Prices of landed properties will continue to remain resilient.
`
“For the high-rise sub-sector, it will continue to be a buyers market,” he says at the launch of CBRE|WTW’s 2022 Market Outlook Report, recently.
`
Peh adds that future launches will generally comprise self-sustained developments that will be on a smaller scale, while at the same time fulfilling the demand for affordable units.
`
Knight Frank Penang executive director Mark Saw also says the residential sub-sector in Penang has improved, posting higher volume and value of property transactions as of the third quarter of 2021.

`
Prop chtProp cht
`
“The Penang state government’s commitment to increase home ownership with plans for a range of affordable homes in various strategic locations, extension of the Penang Home Ownership Campaign until June 2022 and enforcement of mandatory installation of fibre optic telecommunication infrastructure for all new developments, will spur the state’s residential property market.”
`

EPF payout 6.1% for 2021, Look beyond EPF for retirement  EPF posts stronger performance amid economic rebound, focuses on rebuilding members’ savings
`
In terms of challenges, Peh says scarcity of sizeable land in Penang will still continue to pose development constraints.
`
“Additionally, the prolonging effects of the pandemic, especially with the new Omicron variant, could result in cautious spending and a wait-and-see approach.
`
“Stringent lending guidelines and concerns over job security could also potentially derail the market,” says Peh.
`
On the outlook of the Penang office market, Peh says the segment is expected to remain healthy this year, with stable rentals and occupancy rates.
`
“The prospects of co-working spaces still remain encouraging,” he says.
`
As for Penang’s retail sub-sector, Peh says the removal of movement restrictions since last year has been a boost to this sector.
`
“We see normalisation amid ‘freedom euphoria’. However, we expect rentals to be flattish and a widening gap between the newer and older shopper complexes.”
`
As for Penang’s hotel sub-sector, Peh says this segment is set for a steady recovery if the pandemic is significantly contained.
`
“The segment can be spurred further by travel bubbles and other government initiatives.
`
“We also see pent-up demand for medical tourism and intensifying market competition for the hotel sub-sector.”
`
Meanwhile, Knight Frank Malaysia in its real Estate Highlights for the second half of 2021, says the Penang residential market is expected to pick up this year, supported by a series of measures announced under various stimulus packages and Budget 2022.
`
“This will encourage people from various income levels to purchase their dream homes. The overhang of high-rise residential properties, especially in the category of condominiums and apartments, has also been growing.”
`

With limited new supply of purpose-built offices in the state (existing and future), Knight Frank says the occupancies and rental rates for better grade purpose-built office buildings are expected to hold steady.
`
“Meanwhile, with the growing work-from-home trend, some business premises have been converted into co-working space.”
`
Knight Frank noted that the country’s vaccination rate has continued to improve and with further easing of restrictions, the retail segment is expected to slowly recover.
`
“Selected retailers are expected to embrace the rise of eCommerce as they head down the path of recovery.”
`
It adds that Penang’s industrial segment has continued to remain strong and steady throughout the pandemic.
`
“This is especially with the Penang state government’s commitment to expand another two industrial parks in Batu Kawan, with focus on the logistics industry and the remaining phases for mixed industries.
`
“This industrial park is set to continue its history of the successful Bayan Lepas Industrial Park.”
`
Meanwhile, CBRE|WTW in its 2022 Market Outlook Report says property transaction activities in Penang increased for the period of January to September 2021.

`

“A total of 11,981 properties valued at RM7.23bil were transacted, reflecting 13.9% and 33.9% increase in volume and value, respectively, year-on-year.
`
“As more businesses are allowed to operate, the Penang property market has generally rebounded.”
`
CBRE|WTW is optimistic that the rebound will extend into this year.
`
“However, the rebound would be gradual as the pandemic lingers on, along with a sluggish economy and higher cost of living.”
`
CBRE|WTW also expects to see more bargain hunting for residential units this year.
`
“The overhang remains a concern. Prospective purchasers can negotiate for more discounts in addition to the incentives offered,” it says.
`
According to the National Property Information Centre (Napic), there were 30,290 unsold completed residential units (overhang) worth RM19.75bil as at September 2021, compared with 30,926 units worth RM19.99bil in the previous corresponding period.
`
Of the 30,290 overhang units, 18,829 units (or 62.2%) comprised high-rise units, while 6,803 units (22.5%) consisted of terrace houses.
`
The bulk of the overhang units were focused mainly in Johor (6,441 units), Penang (4,638 units), Kuala Lumpur (3,863 units) and Selangor (3,376 units).
`
Napic says 33.7% of the overhang properties consisted of units ranging between RM500,000 and RM1mil, while 28.4% comprised units ranging between RM300,000 and RM500,000.
`
Units below RM300,000 comprised 25.5% of the total overhang, while units above RM1mil (12.4%) consisted of the remaining unsold units during the period under review.
`
Knight Frank concurs that the overall property overhang status continues to remain elevated, especially in the high-rise residential segment.
`
“The performance of the residential sub-sector is improving gradually, registering higher volume and value of property transactions as of the third quarter of 2021,” it says.

Source link

Related News

Modern day Penang reclamations

  

Perak says no to Penang as it needs water

China home prices barely fall in sign of hope for builders

 
`

Related posts:

 

All steady on the home front in Penang residential properties

 

Penang's lively market

Many estate agents and developers generating interests in primary and secondary markets

 

Good time to invest in property now

 

Landed residential properties much sought after with resilent demand, Market insights

 

 

 

 

Penang property prices move sideways in Q1 2016

 

 

 

 

 

When will the property market pick up?

 

Penang Star Property Fair at Queensbay Mall 2016

Developers all smiles with results

 

China buyers eyeing Penang property in growing tourism

 

Young adults in developed countries rent, we buy houses for good

 

Singaporeans on buying sprees for Penang prewar houses; Residents see red

 

Better to buy a car or a house first?

 

 

 

 

 Flat property market seen for Penang

On the recovery path

 

Penang property market to rebound amid lingering challenges

`
THE Penang property market, which had actually started seeing a rebound in transactions since last year, is expected to resume its recovery path into 2022.
`
CBRE|WTW director Peh Seng Yee says the Penang property market can expect a “rebound amid lingering challenges” this year.
`
“We do expect a recovery in market activity for 2022. Prices of landed properties will continue to remain resilient.
`
“For the high-rise sub-sector, it will continue to be a buyers market,” he says at the launch of CBRE|WTW’s 2022 Market Outlook Report, recently.
`
Peh adds that future launches will generally comprise self-sustained developments that will be on a smaller scale, while at the same time fulfilling the demand for affordable units.
`
Knight Frank Penang executive director Mark Saw also says the residential sub-sector in Penang has improved, posting higher volume and value of property transactions as of the third quarter of 2021.

`
Prop chtProp cht
`
“The Penang state government’s commitment to increase home ownership with plans for a range of affordable homes in various strategic locations, extension of the Penang Home Ownership Campaign until June 2022 and enforcement of mandatory installation of fibre optic telecommunication infrastructure for all new developments, will spur the state’s residential property market.”
`

EPF payout 6.1% for 2021, Look beyond EPF for retirement  EPF posts stronger performance amid economic rebound, focuses on rebuilding members’ savings
`
In terms of challenges, Peh says scarcity of sizeable land in Penang will still continue to pose development constraints.
`
“Additionally, the prolonging effects of the pandemic, especially with the new Omicron variant, could result in cautious spending and a wait-and-see approach.
`
“Stringent lending guidelines and concerns over job security could also potentially derail the market,” says Peh.
`
On the outlook of the Penang office market, Peh says the segment is expected to remain healthy this year, with stable rentals and occupancy rates.
`
“The prospects of co-working spaces still remain encouraging,” he says.
`
As for Penang’s retail sub-sector, Peh says the removal of movement restrictions since last year has been a boost to this sector.
`
“We see normalisation amid ‘freedom euphoria’. However, we expect rentals to be flattish and a widening gap between the newer and older shopper complexes.”
`
As for Penang’s hotel sub-sector, Peh says this segment is set for a steady recovery if the pandemic is significantly contained.
`
“The segment can be spurred further by travel bubbles and other government initiatives.
`
“We also see pent-up demand for medical tourism and intensifying market competition for the hotel sub-sector.”
`
Meanwhile, Knight Frank Malaysia in its real Estate Highlights for the second half of 2021, says the Penang residential market is expected to pick up this year, supported by a series of measures announced under various stimulus packages and Budget 2022.
`
“This will encourage people from various income levels to purchase their dream homes. The overhang of high-rise residential properties, especially in the category of condominiums and apartments, has also been growing.”
`

With limited new supply of purpose-built offices in the state (existing and future), Knight Frank says the occupancies and rental rates for better grade purpose-built office buildings are expected to hold steady.
`
“Meanwhile, with the growing work-from-home trend, some business premises have been converted into co-working space.”
`
Knight Frank noted that the country’s vaccination rate has continued to improve and with further easing of restrictions, the retail segment is expected to slowly recover.
`
“Selected retailers are expected to embrace the rise of eCommerce as they head down the path of recovery.”
`
It adds that Penang’s industrial segment has continued to remain strong and steady throughout the pandemic.
`
“This is especially with the Penang state government’s commitment to expand another two industrial parks in Batu Kawan, with focus on the logistics industry and the remaining phases for mixed industries.
`
“This industrial park is set to continue its history of the successful Bayan Lepas Industrial Park.”
`
Meanwhile, CBRE|WTW in its 2022 Market Outlook Report says property transaction activities in Penang increased for the period of January to September 2021.

`

“A total of 11,981 properties valued at RM7.23bil were transacted, reflecting 13.9% and 33.9% increase in volume and value, respectively, year-on-year.
`
“As more businesses are allowed to operate, the Penang property market has generally rebounded.”
`
CBRE|WTW is optimistic that the rebound will extend into this year.
`
“However, the rebound would be gradual as the pandemic lingers on, along with a sluggish economy and higher cost of living.”
`
CBRE|WTW also expects to see more bargain hunting for residential units this year.
`
“The overhang remains a concern. Prospective purchasers can negotiate for more discounts in addition to the incentives offered,” it says.
`
According to the National Property Information Centre (Napic), there were 30,290 unsold completed residential units (overhang) worth RM19.75bil as at September 2021, compared with 30,926 units worth RM19.99bil in the previous corresponding period.
`
Of the 30,290 overhang units, 18,829 units (or 62.2%) comprised high-rise units, while 6,803 units (22.5%) consisted of terrace houses.
`
The bulk of the overhang units were focused mainly in Johor (6,441 units), Penang (4,638 units), Kuala Lumpur (3,863 units) and Selangor (3,376 units).
`
Napic says 33.7% of the overhang properties consisted of units ranging between RM500,000 and RM1mil, while 28.4% comprised units ranging between RM300,000 and RM500,000.
`
Units below RM300,000 comprised 25.5% of the total overhang, while units above RM1mil (12.4%) consisted of the remaining unsold units during the period under review.
`
Knight Frank concurs that the overall property overhang status continues to remain elevated, especially in the high-rise residential segment.
`
“The performance of the residential sub-sector is improving gradually, registering higher volume and value of property transactions as of the third quarter of 2021,” it says.

Source link

Related News

Modern day Penang reclamations

  

Perak says no to Penang as it needs water

China home prices barely fall in sign of hope for builders

 
`

Related posts:

 

All steady on the home front in Penang residential properties

 

Penang's lively market

Many estate agents and developers generating interests in primary and secondary markets

 

Good time to invest in property now

 

Landed residential properties much sought after with resilent demand, Market insights

 

 

 

 

Penang property prices move sideways in Q1 2016

 

 

 

 

 

When will the property market pick up?

 

Penang Star Property Fair at Queensbay Mall 2016

Developers all smiles with results

 

China buyers eyeing Penang property in growing tourism

 

Young adults in developed countries rent, we buy houses for good

 

Singaporeans on buying sprees for Penang prewar houses; Residents see red

 

Better to buy a car or a house first?

 

 

 

 

 Flat property market seen for Penang

All steady on the home front in Penang residential properties

Sales done: According to Knight Frank Malaysia, there are pockets of success by some developers reporting bookings and sales for their affordable homes during the movement control order period despite the fact that physical viewings were disallowed.

DEMAND for residential properties in Penang is expected to remain steady during the second half of 2020, especially if the homes are from renowned developers with good quality products.

Knight Frank Malaysia executive director Mark Saw says there are pockets of success by some developers reporting bookings and sales for their affordable homes during the movement control order (MCO) period (from March 18 to May 3), despite the fact that physical viewings were disallowed.

“In this challenging environment, developers with a strong brand name and good delivery of quality products should still achieve decent returns and the gap between higher and lower quality properties will become more evident with better sales for those able to deliver.

“These factors will play a critical role in determining the success of developments. It has become a buyer’s market and many deals are being offered by developers to attract first-time buyers as opposed to investors who have been temporarily sidelined, ” he tells StarBizWeek.

Due to the Covid-19 pandemic, Saw says buyers’ preferences and timings may change, with decisions being put on hold due to job security, ample choices and rentals being more competitive.

CBRE|WTW director Peh Seng Yee says the pandemic’s impact has been softened in the second half of the year with the recovery MCO (which was implemented from June 10).

CBRE|WTW director Peh Seng Yee says the pandemic’s impact has been softened in the second half of the year with the recovery MCO (which was implemented from June 10).

“As housing is a necessity and with the bank loan moratorium, the residential property sector has been cushioned from the worst impact.

“Hence, the residential market is expected to remain resilient for the second half of 2020. Significant growth is not expected yet as the issue of property overhang, lack of spending confidence by consumers and stringent lending policies by banks are expected to still linger for the remainder of the year.”

Additionally, both Saw and Peh agree that the reintroduction of the Home Ownership Campaign (HOC) was a much-needed boost to the local property market. The government reintroduced the HOC in June under the Short-Term Economic Recovery Plan (Penjana).

 

Mark Saw: In this challenging environment, developers with a strong brand name and good delivery of quality products should still achieve decent returns and the gap between higher and lower quality properties will become more evident with better sales for those able to deliver.

Peh says the HOC is expected to continue to spur the buying momentum for residential properties in Penang over the short term.

“Developers are experiencing a pick-up in bookings by buyers compared with the first half of 2020, which was mainly affected by the MCO.

“However, the encouraging bookings have yet to be fully translated into good actual sales, due largely to stringent lending policies by the bank and the challenges and uncertainty in the economy and job market.”

Saw also believes the HOC will be a short-term reprieve for the local property market.

“The HOC initiatives will only be a temporary measure. For the long term, developers should carry out proper feasibility studies to determine the marketability of their products before commencing developments and ending up with unsold units.”

According to Saw, the volume of residential transactions in Penang decreased 19.7% to 2,748 units in the first quarter of 2020 compared with 3,422 units in the fourth quarter of 2019.

“The value of transactions in the residential sub-sector during the first quarter (RM1.06bil) indicated a drop of 17.2% compared with RM1.28bil in the fourth quarter of last year, ” he says.

Under the HOC, stamp duty exemption will be provided on the transfer of property and loan agreement for the purchase of houses priced between RM300,000 and RM2.5mil.

Meanwhile, the exemption on the instrument of transfer under the HOC is limited to the first RM1mil of the home price, while full stamp-duty exemption is given on loan agreement effective for sales and purchase agreements signed between June 1 and May 31,2021.

The government has also announced real property gains tax (RGPT) exemption for Malaysians for the disposal of up to three properties between June 1,2020 and Dec 31,2021.

The HOC was kicked off in last January to address the overhang problem in the country. The campaign, which was initially intended for six months, was extended for a year.

It proved successful, generating total sales of RM23.2bil in 2019, surpassing the government’s initial target of RM17bil.

Meanwhile, Knight Frank in its Real Estate Highlights Research for the first half of 2020 says that amid the current global recession, Invest Penang has revised downwards its foreign direct investment (FDI) target for 2020 to RM5mil.

“This will be supported by the shift towards Industry 4.0 and the various tax incentives and reinvestment allowances as announced under Penjana that seeks to promote Malaysia as a choice destination for FDIs.”

To clear RM2.6bil worth of 3,043 overhang units in the state, Knight Frank says the Penang local government, housing, town and country planning committee has announced that the state will reduce the minimum price threshold for foreign property ownership by up to 40% starting from June 11,2020.

“Ceiling prices for stratified properties on the island will be reduced by up to 20% from RM1mil to RM800,000 and on the mainland, from RM500,000 to RM400,000.”

In the high-end condominium segment, Knight Frank says IJM Perennial has put on hold the development of The Light City.

“Prior to the Covid-19 pandemic, the group had indicated that it would resume development in August 2020. To be developed over a period of more than four years, Phase 1 will feature a mall with 680,000 sq ft net lettable area, the Penang Waterfront Convention Centre, a four-star hotel with 500 rooms, offices and the ‘Mezzo’ residential condominiums.

“Meanwhile, for Phase 2, there are plans for a 300,000-sq-ft mall, a five-star hotel with 250 rooms, offices, the ‘Essence’ residential condominiums and possibly an experiential theme park. It is worth noting that the commencement of Phase 2 will be determined by the sales of the Mezzo condominiums and the occupancy of the mall.”

As for the office sub-sector in Penang, Knight Frank says the average occupancy rate for four prime buildings monitored in George Town remained stable at 89%.

“According to the latest National Property Information Centre report, the average occupancy rate in the state continued to hold steady at 81.4% in the first quarter of 2020 (compared with 81.3% in the fourth quarter of 2019).”

 Source link

Related posts:

Young buyers flock to property market

 

It’s the right time to invest’ 

Three-month loan moratorium extension for those in need

https://youtu.be/wT4fZ9IcR6c https://youtu.be/nzqy79-m8Z0 Extension for those in need | The Star Rapt attention: Laun...

RM525mil investment for Penang to create 1,600 jobs & human capital programme

( From left) Chow looking at the Penang NCER human capital graphic info. With him are John, state executive councillor Datuk Abdul Halim .

Do we still need an office?

Millennials now make up over a third of the workplace and overwhelmingly value flexibility in where, when and how to work. And top talent has been increasingly clustering in dense urban areas and has been unwilling to commute to suburban office parks

We found that data availability and transparency in the real estate sector is less than what we were used to when we were


Related news:

Potential new DIBS boon

PropertyGuru raises S$300mil to accelerate growth in SE Asia

Minister: Unsold high-end properties here to be offered to HK ...

Vacancy tax – timely solution to problem of property overhang

Insight - Solution sought for unsold high-end properties | The ...

Vacancy tax on back burner | The Star

EXCLUSIVE It's off!: Proposed tax on unsold property put on ..