looks like the price not fall yet

any discussion

You discuss first.

Ikan sapu another lelong unit last week. 🤭🤭

Landed property prices rise in a sector on recovery mode
Monday, 16 Jan 2023

PETALING JAYA: Kenanga Research remains “neutral” on property developers on the view that the sector will continue to be weighed down by the bearish oversupply and cautious lending activity of banks.

A bright spot for the sector, however, is the landed homes sub-segment. Since the onset of the Covid-19 pandemic, prices for terrace homes were the only sub-segment that have shown notable growth, while prices of high-rises and detached homes have either declined or only grown marginally, the research firm revealed.

Housing affordability for many buyers has been eroded by the higher interest rates and soaring construction cost.

The already high household debt-to-gross domestic product (GDP) ratio in Malaysia, which stood at 85% at the end of June 2022, has added to this.

“Our key concerns going into 2023 are developers’ elevated net debt levels and tight cash flows, exacerbated by higher interest rates,” the research house stated in a recent report.

The operating environment for developers is expected to remain challenging in 2023 underpinned by soft pricing power seen in 2022 despite the rising construction and land costs.
While the loan approval rate for the 10 months of 2022 had recovered to pre-pandemic levels of 43%, it is still pale in comparison to the 45% to 51% seen during the upcycle in 2011-2014, Kenanga Research noted.

Bank Negara had raised its overnight policy rate (OPR) by 100 basis points (bps) last year to 2.75% to fight inflation and normalise its rate levels.

Economists at UOB Research expect the central bank to raise the OPR by another 25 bps to 3% this week when its Monetary Policy Committee meets.

This will only add further pressure to buyer’s affordability and translate to higher financing costs and a potential liquidity crunch for highly leveraged developers, as well as weigh on their earnings.

The economy is also starting to slow with Maybank IB Research estimating the GDP growth rate for October and November 2022 averaging at 5% as compared to 14.2% year-on-year in the third quarter of 2022.

Kenanga Research thinks property developers are struggling to pass on higher construction costs to buyers, as price hikes will hurt take-up, putting the viability of the new launches at risk. Thus most choose to sacrifice on margins earned.

“Despite the reprieve (in the overhang situation), we note that there is still a long way towards recovery as units in circulation are still rather high versus historical levels – creating price competition and pressure for new unit launches,” Kenanga Research added.

With all these in mind, Kenanga Research believes developers focusing on landed townships such as Eco World Development Group Bhd, IOI Properties Group Bhd (IOIProp) and Sime Darby Property Bhd will fare better than the rest.

Its top picks are developers with strong cash flows that could anchor good dividends such as Eco World and IOIProp.

great analysis

Oh ioi... I just read this

https://forum.lowyat.net/topic/5354938

Few months alr,anyone feel the property price drop?

Pandemic is over, PH is back in power, perception of cleaner and better government, optimism is back, people feel things can only go up from here, some people returning permanently from overseas with a lot of money. For your target of Subang Jaya landed houses, it is more likely that price remain stable or increase than to drop significantly.

u seems quite optimistic...if u r doing buisness,u will know after the tremendous high inflation + the high OPR rate, the buisness drop 80% in a single month every time,not kidding bro, this the real situation now.

That sounds really bad. I guess I am biased, because the few Subang Jaya landed home owners that I have met will not need to sell their house cheaply, just because of the situation you describe. But I could be wrong so hopefully you will buy a good and cheap landed in Subang Jaya real soon.

Wont be drop, coz demand still there. You can see the KL area are super high demand. Now Cheras also cost around RM5xxk smtg ardy. You can find cheaper in outskirt area only .

I think it totally depends on the price segment. Mid and higher end ones will never go down while the lower priced and not in prime location like outskirts will definitely see some stagnation and possibly a small dip.

Haha most people are quite optimistic. Few days back I started a poll asking what people are doing to prepare for recession and most people are confident that our economy will remain strong even if US which is the biggest consumer of goods, goes into a recession.

While in parallel you see people complaining opr going up, inflation going up, people requesting for epf withdrawal.

landed will not drop..high rise yes

observed quite few months...people said now economy is deceeding.. really?property price naik since last year december

It depends on area and type, landed nope, not goin to drop

Condo, yes, coz too many d nowadays

i find out some wierd situation here, many property Agent said after covid when the market reopen,The demand up,hence the price is up trousmandously and miss the boat alr,What do u think about this statment,do u think we miss the boat?

I think for property, this statement is not good, it is meant to make people feel bad and encourage people to buy in a hurry without doing due diligence.

In reality there is not just one boat, but many will come. After you have prepared your funds for deposit and miscellaneous cost and you have checked the loan amount you need and can get it, then you can search in your target area.

You only miss the boat when you found the property that you like and everything is prepared, but during negotiation you are not willing to accept say RM 5-10k difference from your target price and you walk away and it is sold to someone else. In this case you wait for another boat.

The condos I've been surveying up 3% from covid time (march 2020). I don't think I've missed the boat since it's been 3 years.