hmmm....i think the problem will arise eventually. housing prices shooting up, not many people can afford it, however, they still need a roof above their head. so they will still rent the house or renting room. they have to pay more for rental as well. if cannot pay high rental for good environment living, they have to downgrade to flat/old apartments.

Malaysian Population MEDIAN AGE = 27

This post has been edited by kh8668: Mar 21 2011, 12:42 PM

Saturday March 19, 2011
Moderate price hikes seen for houses
By ANGIE NG
angie@thestar.com.my


ALTHOUGH the demand for residential properties in the Klang Valley is expected to remain good this year, property consultants expect prices of landed housing to show only moderate increases compare with the double-digit jump in 2010.

Landed property prices grew strongly last year, up by as much as 20% in some areas. This can be attributed to the limited new supply, which only increased by 3% during the year, which was less than half of the 6%-8% annual growth seen during 2004-2008.


Brian Koh ... ‘Ultimately the question of affordability and sustainability will kick in.’
Strong buying interest and economic performance data last year led to many new project launches last year after being deferred following the global financial crisis.

The increase in project launches is also due to higher confidence in demand and take-up rate.

Many of these projects will be completed this year and add to the supply numbers.

DTZ Nawawi Tie Leung Sdn Bhd executive director Brian Koh says prices have gone way up last year and this has resulted in the market “becoming quite thin now.”

“Such high prices are not sustainable as there will be a limit to how much they can go up. Ultimately the question of affordability and sustainability will kick in,” Koh says.

Concurring with Koh, Knight Frank Ooi & Zaharin Sdn Bhd managing director Eric Ooi expects prices of landed housing to show modest increases averaging between 5% and 10% these one to two years.

This is in line with the expected slower growth in the country's gross domestic product of 5% to 6% this year from an expansion of 7.1% last year.

“Such increases are healthier and more sustainable for the market. I believe it is one of the effects of Bank Negara's measure that capped the loan-to-value ratio (LVR) at 70% for the third mortgage borrower. It is a good measure to curb speculation in the market,” Ooi says.


The move is seen as a measure to reduce speculative activities and prevent the housing market from overheating as the economy recovers amid a low interest rate environment.

Ooi says market sentiment is still generally healthy with demand strongest for terrace houses priced from RM300,000 to RM1mil.

CB Richard Ellis managing director Allan Soo says the high prices of landed houses have made affordability a serious issue, especially among first-time house buyers.

He says the market preference appears to be for smaller units with lowerentry costs.

Soo says the proposed mass rapid transit (MRT) system augurs well for the market and hopefully there will be more affordable housing projects to meet the needs of the people.

“Developers have already started formulating plans for property developments near the various stations, which should be a major driver for new projects over the next two years,” he adds.

He concurs that the LVR measure has contributed towards curbing speculative buying in the market, notably the medium-high to high-end price range of up to RM3mil.


On overseas investment, he says the strong ringgit over other major currencies has made owning property overseas a more viable proposition for those looking to spread their investment portfolio outside the country.

“Malaysians are venturing overseas and the popular countries include Singapore, the United Kingdom and Australia,” he adds.

Meanwhile, a recent survey by Real Estate & Housing Developers' Association reveals that average prices of newly developed residential property are expected to grow by 13% this year over last year's as a result of rising raw material prices.

The survey found that houses in the RM100,001 to RM500,000 price bracket are the most sellable, while demand for residences priced between RM250,000 and RM500,000 will remain strong in the next six months.

DTZ's Koh says strong demand exists for smaller, starter homes priced at up to RM300,000.

“Although there is good demand for such housing units, this end of the market is not being properly served and there is still a short supply,” he adds.

Echoing his view, Ooi of Knight Frank says that in the KLCC area, there is also keen interest for smaller residences of about 700 sq ft to 1,500 sq ft priced from RM500,000 to RM1mil.

In its latest research report, Knight Frank Research says projects which offer smaller units, such as M-Suites and The Elements@Ampang are well received by the market with sales rates of more than 80% due to their lower entry prices and ease in future leasing.

The high-end condominium segment has a cautious near-term outlook following the imposition of the 70% LVR cap on third mortgages.

Some 1,202 units of high-end condominiums will be launched this year. Kuala Lumpur suburbs will see more launches including MK 20 and MK 28 by Sunrise Bhd, while SP Setia's KL Eco City is also in the pipeline. Others include sixceylon by Bolton Bhd and JSI Serviced Condominiums by UDA Holdings.

According to Knight Frank Research, within the first half of this year, 1,692 units are scheduled for completion in the city centre of Kuala Lumpur and a further 2,020 units will be in the fringe areas of KL.

Some of the notable projects include Panorama, Swiss Garden Residences, Regalia@Sultan Ismail in KL city; Gallery@U-Thant, Damai 206@ Embassy Row and Brunsfield Embassyview in Ampang Hilir / U-Thant; D'Nine, Suasana Bangsar and Gaya Bangsar in Bangsar; Seni Mont' Kiara, Kiara 3, Sunway Vivaldi and Kiara 9 in Mont' Kiara.

CB Richard Ellis in its latest MarketView says the condominium sector, particularly in the KLCC area, performed more poorly last year.

Some high-end projects witnessed a decline in both capital values and rents as the market consolidated after the heady growth of 2007-2009.

“Of concern is the impending supply, with 2011 completions projected to be around 6,000 units, and we expect this to have an effect on the luxury residential market,” the report says.

Bank Negara: Household debt at 12.5pct in 2010 on rebound in consumer sentiment
Written by Joseph Chin of theedgemalaysia.com
Wednesday, 23 March 2011 18:06 - Last Updated Wednesday, 23 March 2011 16:41
KUALA LUMPUR: Bank Negara Malaysia said the household debt level expanded at 12.5% in 2010 from 9.4% in 2009, due to financing for purchase of properties and for personal use.

However, this had been largely offset by a corresponding increase in personal disposable income at the aggregate level.

In its Financial Stability and Payment Systems Report issued on Wednesday, March 23, it said the ratio of household debt-to-GDP remained almost unchanged at 75.9%.

BNM said the financial assets of households expanded at a slower pace of 13.1% (2009: 14.9%) for the year. The growth in household financial assets was mainly attributed to the strong performance of the equity market, which bolstered market valuations and holdings of
equity by households.

“With one third of household financial assets in the form of equity, households are susceptible to volatile swings in equity prices as observed in 2008, when a 39.3% fall in the FBM KLCI precipitated a decline in household financial assets,” it said.

As at end-2010, the ratio of financial asset-to-debt remained relatively unchanged at 238.4%, with more than 60% of the financial assets held in the form of highly liquid assets.

“Liabilities of households expanded at a slower rate relative to financial assets in 2010. The growth was led mainly by financing for the purchase of properties and for personal use,” it said.

The pace of growth however, was higher than the previous year (12.5%; 2009: 9.4%), although this has largely been offset by a corresponding increase in personal disposable income at the aggregate level.

Wow..another 10% hike in selling price for each phase.

oKAY...let's us awaiting for property prices' drop. also wait for food and beverage prices' drop. also wait for rental of rooms drop. Also for petrol prices' drop. also utility bills drop.

Lol....let's us dream more! But also dream of our pay hike..not drop...kekekeke

Lot of projects in Johor Bahru will be launching. mahsing, sp setia, dijaya, UemLand, UmLand, BRDB and many other local players are there.

Sell your properties in Malaysia and buy in Hongkong..LOL

HKD10kpsf about RM5k psf?

As what Gavin's estimation in next 5 years.....LOL

Can share with us how you get an average of rm380psf in Malaysia for condo?

high-end Condominium Market in Malaysia still strong in prices even though rents are decreasing from past few years.

Lot of buyers are still having strong holding power.

Malaysian damn rich

Which one ohh

BLR stays below 7.00% for last 10 years d.

Now housing loan

BLR - 2.2% to 2.5%

effective rate is still pretty low.

so buy or not buy? borrow or not borrow?

More to come la...
http://www.blr.my/

100% Home Loan For First Time House Buyers

Those with income below RM3000 need not make down payment on house. First time house buyers with a family income less than RM3000 per month need not pay the 10% down payment under the My First House Scheme (SKIM Rumah Pertamaku) home loan.

The 10% down payment will be guaranteed by Cagamas Bhd for houses priced between RM100,000 and RM220,000. This will allow the first time buyers to obtain 100% home loan with will enable them to buy houses costing between RM100,000 and RM220,000 with a repayment period of up to 30 years. The scheme does not cover refinancing of a home.

To qualify for the scheme, which is for both houses under construction and completed properties, house buyers must be those working in the private sector and are confirmed employees with a minimum of six months in the job. The self-employed do not qualify for the scheme while joint applications are allowed, provided that both are in the private sector and are family members, such as siblings or spouses.

The monthly financing repayment sum must also be not more than one-third of the applicants’ monthly gross income. However, this sum can go up to 50% of their income if additional credit is permitted under the banks’ underwriting policy.

They will also be given stamp duty exemption of 50% on instruments of transfer on a house not exceeding RM350,000. The government also proposed a stamp duty exemption of 50% for loan agreement instruments to finance first-time purchasers.

The scheme sees the participation of 25 conventional and Islamic financial institutions including major banks like AmBank, CIMB, Hong Leong, Maybank, Public Bank, RHB and Standard Chartered.

For government servants, the goodies include an increase in the maximum loan eligibility from RM360,000 to RM450,000 effective 1 Jan 2011.

Approved rate still got 50%






Wednesday April 6, 2011 (The Star Online)
Downtrend in property loans

Higher deposit to curb market speculation seems effective

PETALING JAYA: Bank Negara's move to require house buyers to pay a higher deposit seems to be weeding out speculation in the property market, some analysts said.

Its monthly statistical bulletin last week showed that for fourth consecutive months since November, the number of loan applications to buy residential property has reduced.

On Nov 2 last year, the central bank announced a 70% loan-to-value (LTV) cap on a borrower's third and subsequent house-financing facility, meaning that these buyers would have to fork out 30% of the purchase price.

The move was prompted by fears of a retail credit bubble fuelling speculation on the prices of residential properties. Certain areas reported price spikes that are indicative of speculation and multiple-unit purchases by individuals.

However, analysts cautioned that the data was not conclusive.

Some analysts said the decline in the first couple of months might be seasonal and believed data from March would accurately show the effects of the LTV rule.

RAM Rating Services Bhd's head of financial institutions ratings Promod Dass said: “Household financing facilities now account for approximately 55% (or RM489bil) of the local banking system's loans, with loans for the purchase of residential property comprising about half (RM238bil) of total household loans.

“Although the full impact of this move has yet to filter through given the short time since its implementation, loan applications for residential property purchases have started slowing down in the last two months of 2010 and January.

“The heftier down payment because of the more stringent 70% LTV cap is aimed at discouraging excessive over-leveraging in the property market. While the early signs are that this move has weeded out a degree of speculation in the residential property market, it will take at least six more months to gain a conclusive feel on whether such speculation has been curbed,” Promod said in an e-mail.

Malaysian Rating Corp vice-president and head of financial institutions ratings Anandakumar Jegarasasingam said the LTV ruling was insufficient to control the level of household sector debt in the economy or an unhealthy property price appreciation.

“Any individual who is purchasing a third residential property is either likely to be affluent or a reasonably savvy property speculator. If property speculation is to be curbed, the authorities should perhaps explore more direct measures involving taxes and prudential restrictions,” he said.

Another issue was whether the current trend of lower applications for housing loans could eventually lead to a softening of the property market.

ECM Libra said in its banking report yesterday that “residential property and non-residential loans approved have shrunk and are set to continue their downtrend.”

ECM Libra's analyst Bernard Ching said “loans growth are expected to taper off due to our expectation that property sales growth may slow down later this year as a result of the imposition of loan-to-value cap.”

Another analyst said the drop in housing loan applications, and the reduction in the number of loans approved, would eventually lead to a softening of the property market. “Increasingly, developers will find it more difficult to push sales and this will lead to a softening,” he said.

For Bank Negara statements click here



This post has been edited by kh8668: Apr 6 2011, 11:20 AM

Do not see the point here.


if earning 50% from purchasing price
property
bought 500k
Sold 750k
fees involve say: RM50k
net earning before tax = RM200k
RPGT 5% = RM10k
Net earning after RPGT = RM190K

if earning 30% from purchasing price
property
bought 500k
Sold 650k
fees involve say: RM50k
net earning before tax = RM100k
RPGT 5% = RM5k
Net earning after RPGT = RM95K

so why selling and earn 30% if you can sell and earn 50% margin from purchased price?

bro/sis...rpgt if going back to original 30%....if your net earning before tax = 100K, after tax still got 70k la..

check out the RPGT calculation, then you will know more.

and investors should know what they are buying and with their own objectives...not to worry whether they buy or not buy, how much they make or not make, got incentive or less incentive..lol

This post has been edited by kh8668: Apr 6 2011, 10:18 PM

hopefully reducing the buying/speculation demand....however the first time buyers and upgraders are still there planning for their home. As long as LTV 90% for first/2nd purchase still applicable then should be okay for the market.

and one thing, I personally do not expect property price will come down based on historically data of Malaysia property price, also due to inflation.

One thing we need to rethink.....if property prices heading south, how far it will go from current level? 1km=10%, 2km=20%, and so on so.

For references, from 2008 till 2011 April, property prices in the selected prime location already hit up 30% - 60%.

so are we expecting it will go down to 50% or more? or 5% down from the current level and then shooting up again 10%/20% or more?

kekeke..who got crystal balls?