KAJANG: The Malaysian residential property market saw a decline in the number of overhang units in 2020, as transactions slowed down during the year due to the impact of the Covid-19 pandemic.
At the launch of the National Property Information Centre (Napic), Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said the overall property sector recorded 295,968 transactions worth RM119.08bil in 2020, which was a 9.9% year-on-year decline in volume and 15.8% drop in value compared with 2019.
Despite the weaker performance, Tengku Zafrul said in his speech that the market is expected to perform better this year, underpinned by the national immunisation programme and numerous government incentives.
Meanwhile, Napic said the residential sub-sector led overall property market activity in 2020 with a 64.7% contribution in volume.
The sub-sector recorded 191,350 transactions worth RM65.87bil, a decrease of 8.6% in volume and 9% drop in value compared with 2019.
Selangor contributed the highest volume and value to the national market share with 23% (44,032 transactions) and 33% (RM37.79bil) respectively.
The primary market saw fewer new launches with 47,178 units in 2020, compared with nearly 60,000 units in 2019.
Napic said the sluggish property market and cautious buyer sentiment contributed to the modest sales performance at 28.7%.
Meanwhile, the overhang situation saw a slight improvement in 2020. Napic said there were 29,565 overhang units worth RM18.92bil last year, which was a decline of 3.6% in volume compared with 2019, although value increased by 0.5%.
Napic said the number of unsold under construction and unsold, not constructed units reduced by 1.3% year-on-year to 71,735 units and down 22.6% to 12,975 units respectively in 2020.
Meanwhile, construction activities remained on a low tone as completion, starts and new planned supply declined; each dropping 12.2% to 77,009 units, 18.6% to 82,188 units and 20.5% to 71,725 units respectively.
Separately, Napic said the Malaysian House Price Index stood at 199.3 points in 2020 with a low annual growth of 0.6%, the lowest since 2010.
Napic said all states recorded annual growth in 2020 except for Kuala Lumpur (-1%), Selangor (-0.7%), Penang (-0.1%) and Sabah (-1.3%).
In terms of the commercial sub-sector, Napic said there were 20,255 transactions worth RM19.53bil recorded in 2020, a drop of 21% in volume and 32.6% in value compared with 2019.
Selangor contributed the highest volume and value with 4,779 transactions (23.6%) worth RM5.42bil (27.8%), followed by Kuala Lumpur with 3,072 transactions (15.2%) worth RM4.79bil (RM24.5%).
In terms of overhang within this sub-segment, serviced apartments was the biggest contributor.
Napic said there was a total of 23,606 overhang units of serviced apartments worth RM20.76bil in 2020, up 37.7% in volume and 38% in value compared with 2019.
Similarly, the unsold under construction and not constructed increased to 35,258 and 8,153 units, up 4.2% and 6.4% respectively.