A sobering piece of news about the state of property transactions in Penang. During a press conference, the Real Estate and Housing Developers Association (Rehda) Penang chapter chairman Datuk Jerry Chan said that 2014’s overall property transactions were 20% lower than 2013. Nevertheless any Penangite friend you have would tell you that the prices did not really move downwards. He further said that “The cooling measures put in place by the state government to discourage speculation were effective in reducing property transactions, but these did not affect property prices due to rising costs.’ Major reason is because of the development charges levied by the local authorities, land costs and other charges, materials and labour costs have continued to rise. Thus he is asking the state government to be more lenient in the development charges. Market is slowing and this is no longer the time to be even more stringent.
In Penang, the Malaysia Property Exhibition (Mapex) 2015 would be held from February 21 to 23 at G Hotel. Yes, that’s just one week later, during the Chinese New Year period. Sometimes you may think why are they holding property fairs during such holiday periods. Well, this is the time when family members from all over the country and even out of the country comes back for a reunion dinner and during such times they may find that their current parent’s home has become too small due to their growing family. They can thus drop by the property fair together and make a quick decision. Good for the developers who are participating, right? Well, it depends on what they are offering of course.
Datuk Jerry Chan also said something which is not just true today but will always be true for a long time especially for Malaysia. He said “Property prices have stabilised, so now is a good time to invest in properties.” The key word would be ‘stabilised’. He did not say prices softening. In fact, in certain markets if transactions fall 20%, prices are sure to soften. I checked the price of a condo I sold in Penang just few months ago. The price range has not changed and has even shown an upward bias because the size is close to 1,300sf. There are not a lot of these properties compared to those of 1,000sf and below. In fact moving forward, to make it affordable, a lot of new condos are sized at 1,00sf or lower. Want to know what is really happening? Well, head on to the MAPEX Penang show in G Hotel from 21st to 23rd February 2015.
written on 14 Feb 2015
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