The property market for 2019 recorded a marginal improvement amidst a turbulent year of many trials and tribulations.
A total of 328,647 transactions worth RM141.4bil was recorded, showing an increase of 4.8% in volume and 0.8% in value compared to 2018, which recorded 313,710 transactions worth RM140.33bil.
According to the Valuation and Property Services Department of Malaysia, the sectoral market activity performance also improved marginally, with residential at 6%, commercial at 7.2%, industrial at 3.8%, and agricultural at 2.0%.
However, development of the land sub-sector declined slightly by 1.2% while the residential sub-sector led the overall property market, with a 63.7% contribution.
Statistics for residential properties showed 209,295 transactions worth RM72.42bil recorded in the review period, increasing by 6.0% in volume and 5.3% in value as compared with 2018 (197,385 transactions worth RM68.75bil).
Performance across the states improved in the review period. By price range, demand continued to focus on the RM300,000 and below category. This demand accounts for 61.7% of the residential transaction, followed by RM300,000 to RM500,000 (21.3%), RM500,000 to RM1mil (13.3%) and more than RM1mil at 3.7%.
The overhang and unsold situation took an upturn, with a total of 30,664 overhang units worth RM18.82bil, decreased by 5.1% in volume and 5.2% in value against 2018 (32,313 units worth RM19.86bil). Similarly, the unsold under construction and not constructed category improved as the number dropped to 72,692 units and 16,774 units, down by 10.2% and 15.6% respectively.
Johor retained the highest number and value of overhang in the country with 5,627 units worth RM4.7bil, accounting to 18.4% and 25.0% respectively of the national total. Perak came second with 5,024 units worth RM1.52bil, followed by Selangor at 4,687 units worth RM3.75bil, and Pulau Pinang at 3,353 units worth RM2.59bil. By price range, products priced from RM300,000 to RM500,000 (7,883 units) formed 25.7% while those above RM500,000 (12,528 units) constituted 40.9% of the total residential overhang.
Construction activities remained on a low tone as completion, start of projects, and new planned supply declined. On the price trend, the Malaysian House Price Index (MHPI) continued to increase at a moderating rate. MHPI stood at 197.5 points (at base year 2010), increasing by 1.9% (3.8 points) on an annual basis (2018: 193.7 points).
Unlike the residential overhang situation, serviced apartment overhang continued to increase, and it forms the bulk of the property overhang. There were a total of 17,142 overhang units with a value of RM15.04bil, up by nearly 51% in volume and 65% in value against 2018.
On the contrary, the unsold under construction and not constructed categories improved with volumes declining to 33,827 units and 7,659 units, down by 9.3% and 40.5% respectively. By state, Johor recorded the highest serviced apartment overhang with 71.2% share in volume (12,207 units) and 76.9% share in value (RM11.56bil).
The majority of these overhang units are in the Johor Bahru district, accounting for 99.2% of the state’s overhang (12,105 units worth RM11.5bil). The state also held a 34% share (11,490 units) of the country’s unsold under construction.
By price, units above RM1mil formed 37.4% of the total overhang, with 20.3% being the total unsold under construction category and 19.5% of the total unsold not constructed category. For the unsold not constructed category, units in the price range of RM300,000 to RM400,000 formed 33.0% of the total.