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> PROPERTY MARKET TO BE BADLY HIT IN 2018, Tekan the greedy sellers to the max!

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pearl_white
post Mar 2 2018, 08:50 PM

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Here is something new and it is about the automotive industry. And it is a trend evident here.

TIV hits circa 600k p.a. However, if you look at the product mix, sadly, the value of vehicles are of the 'economic type'. Look at the product mix a few years back and it more higher end type.

TIV value of the yester-years have gone down and down for 10 years straight.

Disposable income of the downhill countrywide.


BEANCOUNTER
post Mar 2 2018, 11:06 PM

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Care to explain what is TIV?

not everyone here is economic experts taiko.
yunodie
post Mar 2 2018, 11:09 PM

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QUOTE(BEANCOUNTER @ Mar 2 2018, 11:06 PM)
Care to explain what is TIV?

not everyone here is economic experts taiko.
*
Total Industry Volume. automotive industry jargon used by AAM to define the health of the industry.
BEANCOUNTER
post Mar 2 2018, 11:14 PM

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It could be car prices have dropped in general.

We should all thanks to jibby...

U see many conti cars than ever on the road. U know already
mini orchard
post Mar 3 2018, 07:15 AM

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QUOTE(topearn @ Feb 25 2018, 08:51 PM)
If everyone is leveraged to the max, how come still got people buying properties ?
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We cant expect the property transaction to come to a standstill.

There will always be newcomers into the property market when developers downsized the unit with lower entry price or subsale vendor lowering the asking price.

This post has been edited by mini orchard: Mar 3 2018, 08:00 AM
topearn
post Mar 3 2018, 10:04 AM

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QUOTE(pearl_white @ Mar 2 2018, 08:50 PM)
Here is something new and it is about the automotive industry.  And it is a trend evident here.

TIV hits circa 600k p.a.  However, if you look at the product mix, sadly, the value of vehicles are of the 'economic type'.  Look at the product mix a few years back and it more higher end type.

TIV value of the yester-years have gone down and down for 10 years straight.

Disposable income of the downhill countrywide.
*
I think it's cos car manufacturers are producing cheaper cars.
pearl_white
post Mar 4 2018, 08:40 PM

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My buddy has just been laid off.

His developer boss wanted to build 84 houses worth rm900k each.

Only managed to sell 2 after 1 year of marketing efforts.

Project stopped wef until further notice.

This post has been edited by pearl_white: Mar 4 2018, 08:41 PM
topearn
post Mar 8 2018, 09:17 PM

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QUOTE(pearl_white @ Mar 4 2018, 08:40 PM)
My buddy has just been laid off.

His developer boss wanted to build 84 houses worth rm900k each.

Only managed to sell  2 after 1 year of marketing efforts.

Project stopped wef until further notice.
*

What is this project ? Location ? So got 82 x RM900K stock = RM73.8M ? Should just sell cheap cheap, rather then get 0 sales.

266K
post Mar 9 2018, 02:06 PM

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BN kalah then create racial riot then declare emergency then economy meleset, then many properties price collapse...end of story..
BEANCOUNTER
post Mar 9 2018, 05:41 PM

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QUOTE(266K @ Mar 9 2018, 02:06 PM)
BN kalah then create racial riot then declare emergency then economy meleset, then many properties price collapse...end of story..
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In order for bn to kalah.....cina and indian votes wont do this.

It needs quite a large portion of malay votes too ......

How to have racial riot except for opportunists?
pearl_white
post Mar 28 2018, 09:25 PM

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https://www.thestar.com.my/business/busines...ket-imbalances/

KUALA LUMPUR: Severe property market imbalances due to the acute oversupply of the office space and shopping complex segments, if left unchecked, can pose risks to macroeconomic and financial stability, warns Bank Negara Malaysia.

In its Financial Stability and Payment Systems Report 2017 issued on Wednesday, it said that last year banks’ end-financing for the purchase of non-residential properties stood at RM213.4bil (2016: RM209.1il). This was an annual increase of 2.1% (2016: 6.1%).

“Such financing accounted for 26.1% of banks’ exposures to the property market or 13.5% of banks’ total outstanding loans.

“End-financing for the purchase of shops accounted for the bulk (40%) of banks’ exposures to non-residential properties or 5.4% of banks’ total outstanding loans. Exposures (via end-financing) to the office space and shopping complex segments, where oversupply is particularly acute, accounted for 3.2% of banks’ total outstanding loans,” it said.

Bank Negara pointed out that activities in the commercial property segment (comprising shops, office space and shopping complexes) remained soft, amid an oversupply in these segments and challenges faced by businesses in the oil and gas (O&G) sector.

The volume of commercial property transactions declined by 8.2% (2010-2016 average: -4.7%) to 16,025 units during the first nine months of 2017. The value transacted nonetheless increased by 3.8% to RM17.8bil driven by higher transactions of properties priced RM1mil and above.

Slower activities in the commercial property segment were observed in most major states such as Kuala Lumpur, Selangor, Johor and Penang.

“Severe property market imbalances, if left unchecked, can pose risks to macroeconomic and financial stability

“Risks remained heightened in the office space and shopping complex segments, given the oversupply situation,” it said.

Based on Bank Negara’s analysis, the incoming supply of 38 million square feet of new office space in Klang Valley is expected to drive vacancy rates to an all-time high of 32% by 2021 (1997: 5.1%; historical high in 2001: 25.3%), far surpassing levels recorded during the Asian Financial Crisis (AFC).

Similarly, the incoming supply of 140 new shopping complexes by 2021 across Klang Valley, Penang and Johor is expected to worsen the oversupply condition in this segment.

In 2016, major states such as Penang, Klang Valley and Johor already had higher retail space per capita (10.5, 8.2 and 5.1 square feet per person, respectively) relative to regional cities such as Hong Kong and Singapore (3.6 and 1.5 square feet per person, respectively).

This will continue to exert downward pressure on occupancy rates and rentals.

Bank Negara pointed out that as at third quarter of 2017, vacancy rates of shopping complexes increased moderately to 18.8% (2016: 18.6%; 2010-2015 average: 19.5%) despite rental rates remaining stable.

Vacancy rates of office space declined to 16.8% (2016: 17.7%; 2010-2015 average: 16.3%).

“While overall business sentiment is expected to improve, risks remained heightened in the office space segment with continued cost-cutting measures by businesses, including downsizing of office space or relocating to lower-cost premises.

“The average rental rate of office space in the Klang Valley remained depressed at RM5.83 (2016: RM5.94) per square foot per month,” it said.

Shops account for more than half (56%) of commercial property transactions, with about 60% of outstanding loans to purchase shops taken by individuals.

Trends in this segment typically follow developments in the housing market given that shops are viewed as an alternative investment asset class to residential properties.

In the first nine months of 2017, the number of shops transacted recorded a smaller decline of 7.4% to 8,918 units, compared to 9,629 units during the same period last year (January to September 2016: -29.4%; 20102016 average: -11.3%).

Total value transacted grew by 0.2% to RM6.94 billion during the same period (January to September 2016: -35.3%; 2010-2016 average: -8%).

“Planned supply of shops continued to decline for the third consecutive year (3Q 2017: -37.7%; 2016: -17.9%).

“The lower supply of new shop units, to some extent, has contributed to the decline in the overhang of shop units thus containing the risk of oversupply in the near term,” said Bank Negara.

As at end-September 2017, the number of overhang shop units declined by 22% (2016: 20.1%; 2010-2016 average: 0.6%) to 3,811 units, with a similar trend observed across most price segments.

Speculative purchases of shops remained contained. The growth in the number of borrowers purchasing multiple shop units or combined shop and housing units continued to decline (2017: -0.7%; 2016: -0.6%).

Such speculative purchases accounted for 7.3% (2016: 7.4%) of total borrowers of loans to purchase houses and shops. This reflects muted speculative activity in this segment, hence reducing the risk of sharp price adjustments in the future.

The number of loans to purchase shops settled within three years, another indication of speculative purchases, declined to 12.3% (2016: 13.4%) of total loans to purchase shops that were settled during the year, well below levels observed in 2012 (close to 30%).

“Arising from the oversupply situation, banks have become more cautious in lending to the office space and shopping complex segments, as reflected in the markedly lower loan approval rates for the construction and purchase of such properties (2017: 70.9% and 72.8%, respectively; 2016: 76.8% and 80.2%, respectively).

“Banks’ current exposures to these segments in the form of loans and holdings of corporate bonds and sukuk amounted to about RM84bil. These exposures accounted for 4.9% and 5.4% of banks’ total outstanding loans, and holding of corporate bonds and sukuk respectively.

“Impaired loans ratio for the non-residential property segment remained low at 1.1% in 2017 (2016: 1%),” it said.

Similar to housing loans, vintage default rates for loans to purchase non-residential properties originated across the years since 2007 continued to show improvement.

Bank Negara said in general, banks are able to withstand a broad property slowdown, including from the oversupply situation in the office space and shopping complex segments.

“Sensitivity analysis conducted by the Bank indicated that banks have sufficient buffers to absorb potential losses arising from property price corrections and its spillover to other industries that are highly dependent on the performance of the property sector,” it said.
pearl_white
post Mar 29 2018, 12:54 PM

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https://www.thestar.com.my/business/busines...e-unaffordable/

KUALA LUMPUR: The number of unsold housing units increased in 2017 while houses also remained unaffordable especially in key employment centres, according to Bank Negara Malaysia.

In its Financial Stability and Payments report for 2017, it said there was an uptick in housing market activities, despite the high number of unsold residential properties priced at RM250,000 and above.

Unsold housing units increased on an annual basis by 22.7% in 2017 (2016: 41%) to 129,052 units as at end-September 2017.

More than 80% of the unsold units were priced at RM250,000 and above.

Many of these units were high-rise residential properties and were mainly in areas located far from major economic centres and with limited public transport facilities.

“The high number of unsold housing units also reflects the persistent mismatch between the selling price of houses being built and what most households can afford,” according to the report.

Between 2013 and October 2017, Bank Negara said 123,103 units of affordable homes have been built by the government, with over one million units at various stages of construction or planning.

The Government has also announced a freeze on the development of new luxury residential properties to rebalance the supply in the residential property market.

“Nonetheless, incoming supply of affordable housing remains insufficient to meet the rising demand from households.

“From January 2016 until September 2017, only 24% of new launches (25,124 units including those built by private developers) were priced below RM250,000,” it said.

This is inadequate to meet the demand of about one-third of Malaysian households that can only afford houses priced below this level.

The mismatch was exacerbated by the slower increase in median household income (CAGR 2012-2016: 9.6%) relative to median house prices (15.6%), rendering houses being seriously unaffordable4 in certain parts of the country

Bank Negara says despite growing Imbalances in the property market, there are no Imminent risks to financial stability.

In 2017, total exposures of Malaysian financial institutions to the domestic property market expanded by 7.1% (2014-2016 average: 12.5%) to RM850.3bil. The expansion was largely attributed to end-financing for the purchase of residential properties (5.3 percentage points).

Bank Negara also points out that total exposures of Malaysian financial institutions to the domestic property market accounted for 27.4% (2016: 26.7%) of their total assets as at end-2017.

Banks remained the largest lenders to the domestic property market. Out of the RM817.3bil of banks’ exposures to the property market, about 90% was related to end-financing for the purchase of residential and non-residential properties.

For the residential property market, in the first nine months of 2017, the total value of housing transactions registered an annual growth of 2.6% (2016: -10.7%), with the volume of housing transactions recording a smaller decline of 6.1% (2016: -13.9%).

This reflected the higher share of transactions for the purchase of houses priced above RM500,000 in both the primary and secondary markets.

The average house price as measured by the Malaysian House Price Index (MHPI) continued to increase at a moderate pace of about 7% in the first half of 2017 (3Q 2017 preliminary: 5.1%; 2016: 7.1%; 2010-2014 average: 9.6%; 1990-2009 average: 5.5%).

Bank Negara said as for speculative activities in the housing market, they remained subdued with the bulk of loans directed to first-time house buyers.

Outstanding financing extended to first-time buyers for the purchase of houses priced below RM500,000 accounted for about 71% of total housing loan borrowers.

“The risk of significant price correction for such exposures remained limited due to sustained strong demand,” it said.

In 2017, the number of borrowers with three and more outstanding housing loan accounts, a proxy for speculative purchases, grew by 0.9% (2016: 1.2%; 2010: 15.8%), accounting for less than 3% of total housing loan borrowers.

The share of housing loans settled within three years, another gauge of speculative purchases, reduced further to 9.7% (2016: 11.8%) of total housing loans settled.

pearl_white
post Mar 29 2018, 12:56 PM

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The problem with central banks worldwide is that any risks in any sectors is ALWAYS too late to save.
topearn
post Mar 29 2018, 01:49 PM

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QUOTE(pearl_white @ Mar 29 2018, 12:54 PM)
https://www.thestar.com.my/business/busines...e-unaffordable/

KUALA LUMPUR: The number of unsold housing units increased in 2017 while houses also remained unaffordable especially in key employment centres, according to Bank Negara Malaysia.

In its Financial Stability and Payments report for 2017, it said there was an uptick in housing market activities, despite the high number of unsold residential properties priced at RM250,000 and above.

Unsold housing units increased on an annual basis by 22.7% in 2017 (2016: 41%) to 129,052 units as at end-September 2017.

More than 80% of the unsold units were priced at RM250,000 and above.

Many of these units were high-rise residential properties and were mainly in areas located far from major economic centres and with limited public transport facilities.

“The high number of unsold housing units also reflects the persistent mismatch between the selling price of houses being built and what most households can afford,” according to the report.

Between 2013 and October 2017, Bank Negara said 123,103 units of affordable homes have been built by the government, with over one million units at various stages of construction or planning.

The Government has also announced a freeze on the development of new luxury residential properties to rebalance the supply in the residential property market.

“Nonetheless, incoming supply of affordable housing remains insufficient to meet the rising demand from households.

“From January 2016 until September 2017, only 24% of new launches (25,124 units including those built by private developers) were priced below RM250,000,” it said.

This is inadequate to meet the demand of about one-third of Malaysian households that can only afford houses priced below this level.

The mismatch was exacerbated by the slower increase in median household income (CAGR 2012-2016: 9.6%) relative to median house prices (15.6%), rendering houses being seriously unaffordable4 in certain parts of the country

Bank Negara says despite growing Imbalances in the property market, there are no Imminent risks to financial stability.

In 2017, total exposures of Malaysian financial institutions to the domestic property market expanded by 7.1% (2014-2016 average: 12.5%) to RM850.3bil. The expansion was largely attributed to end-financing for the purchase of residential properties (5.3 percentage points).

Bank Negara also points out that total exposures of Malaysian financial institutions to the domestic property market accounted for 27.4% (2016: 26.7%) of their total assets as at end-2017.

Banks remained the largest lenders to the domestic property market. Out of the RM817.3bil of banks’ exposures to the property market, about 90% was related to end-financing for the purchase of residential and non-residential properties.

For the residential property market, in the first nine months of 2017, the total value of housing transactions registered an annual growth of 2.6% (2016: -10.7%), with the volume of housing transactions recording a smaller decline of 6.1% (2016: -13.9%).

This reflected the higher share of transactions for the purchase of houses priced above RM500,000 in both the primary and secondary markets.

The average house price as measured by the Malaysian House Price Index (MHPI) continued to increase at a moderate pace of about 7% in the first half of 2017 (3Q 2017 preliminary: 5.1%; 2016: 7.1%; 2010-2014 average: 9.6%; 1990-2009 average: 5.5%).

Bank Negara said as for speculative activities in the housing market, they remained subdued with the bulk of loans directed to first-time house buyers.

Outstanding financing extended to first-time buyers for the purchase of houses priced below RM500,000 accounted for about 71% of total housing loan borrowers.

“The risk of significant price correction for such exposures remained limited due to sustained strong demand,” it said.

In 2017, the number of borrowers with three and more outstanding housing loan accounts, a proxy for speculative purchases, grew by 0.9% (2016: 1.2%; 2010: 15.8%), accounting for less than 3% of total housing loan borrowers.

The share of housing loans settled within three years, another gauge of speculative purchases, reduced further to 9.7% (2016: 11.8%) of total housing loans settled.
*
Residential property markets not affected, right ?
pearl_white
post May 3 2018, 03:27 PM

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https://www.thestar.com.my/business/busines...enquiry-system/

KUALA LUMPUR: The National Property Information Centre (Napic) has launched an Unsold Property Enquiry System Malaysia (UPESM) to provide information to market players like developers, local authorities, buyers and other interested parties.

Napic director Md Badrul Hisham Awang said on Thursday the system was developed last year and launched in April 2018.

"The system shows the type of overhang properties, location and type. We want developers, local authorities and investors to know the information in detail," he said.

The service is free but is limited to 2016 and 2017 because of the high level of overhang.

Completed-but-unsold residential units ballooned to RM12.26bil for the first half of 2017 from about RM8.56bil for the same period in 2016 (2015: RM4.92bil).

Known as an “overhang”, total unsold completed units stood at 20,876 in 2017, compared with 14,792 at the end of 2016, most of them high-rise residentials costing RM500,000 and above.

Napic's overhang figure is lower than Bank Negara's figure of more than 140,000 units because it includes serviced apartments and launched units but unsold after a certain period.

Napic excludes serviced apartments because these are built on commercial land titles. NAPIC also includes units as overhang only after the unit is ready for occupation but unsold.

The total number of residential overhang for 2017 totalled 24,738 units valued RM15.6bil with 38.4% comprising high rise units.

In terms of price, 22.7% of the overhang units according to Napic are between RM500,000 and RM1mil.
glauncher
post Jun 15 2018, 10:44 AM

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So after 6 months of 2018, did property prices really went down in the first half?
Pain4UrsinZ
post Jun 15 2018, 10:57 AM

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QUOTE(glauncher @ Jun 15 2018, 10:44 AM)
So after 6 months of 2018, did property prices really went down in the first half?
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seems like stagnant
AskarPerang
post Jun 16 2018, 04:37 PM

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QUOTE(glauncher @ Jun 15 2018, 10:44 AM)
So after 6 months of 2018, did property prices really went down in the first half?
*
6 months can see more investors got burnt. Newly completed property straight enter lelong.
Buying at wrong location.
Buying an overprice property.

Give another 6 months till end of this year, will see even more investors without any proper plan or holding power will be flushed out.
Plenty of example to share. Landed at ulu location got. High rise at prime location also got.
BEANCOUNTER
post Jun 16 2018, 09:21 PM

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QUOTE(AskarPerang @ Jun 16 2018, 04:37 PM)
6 months can see more investors got burnt. Newly completed property straight enter lelong.
Buying at wrong location.
Buying an overprice property.

Give another 6 months till end of this year, will see even more investors without any proper plan or holding power will be flushed out.
Plenty of example to share. Landed at ulu location got. High rise at prime location also got.
*
Generally i dun think prices in general have nose dive.
Not making money or little profit yes.

And owners expectation need to be realistic.
nyc3650
post Sep 5 2018, 02:50 AM

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QUOTE(BEANCOUNTER @ Jun 16 2018, 09:21 PM)
Generally i dun think prices in general have nose dive.
Not making money or little profit yes.

And owners expectation need to be realistic.
*
Basis on the JPPH survey Q1 report 2018. It started to bleak comparing to 2017 top performance. And also weaker than 2016 report.



This post has been edited by nyc3650: Sep 5 2018, 02:55 AM


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