Improvement in property sector but building material prices still a concern

An aerial view of Petaling Jaya, Selangor

KUALA LUMPUR: The real estate sector saw improvement both in terms of transactions and value this year compared with 2021, supported mainly by the resumption of economic activities across the board and the reopening of the country’s international borders.

The National Property Information Centre (Napic), which comes under the Valuation and Property Services Department revealed that over 188,000 transactions worth RM84.40bil were recorded in the first half of 2022, an increase of more than 30% in volume and value compared to the same period previously.

The residential property sector recorded 116,178 transactions worth RM45.62bil in the review period, an increase of 26.3% in volume and 32.2% in value year-on-year (y-o-y).

Penang, Kuala Lumpur, Johor and Selangor remained as the four major states, accounting for 47% of the total national residential volume.

The commercial property segment recorded 15,169 transactions valued at RM14.02bil, up by 45.4% in volume and 28.3% in value compared with the same period in 2021.

Selangor contributed the highest volume and value to the national market share with 26.5% in volume (4,025 transactions), and 33.5% in value (RM4.7bil).

The first half of 2022 saw more than 10,000 newly launched units, down by 66.7% against 31,687 units in the first half of 2021.

Napic said 20.3% of newly launched units were sold, slightly lower than the 20.6% recorded in the first half of 2021, and 8.1% in the second half of 2021.

This does not mean that the sector is without challenges on the business operation side.

The industry is still plagued by price hikes of building materials and labour shortage, severely affecting productivity in both the property and construction sectors, Real Estate and Housing Developers’ Association Malaysia (Rehda) said.

Its Property Industry Survey for the first half of 2022 and Market Outlook for the second half of 2022 and first half of 2023 revealed that fewer residential units were launched in the first half of 2022, recording a 26% decline compared with the second half of last year.

Sales performance was down by five percentage points from 50% in the second half of last year to 45% in the period under review, according to its study which surveyed 150 developers.

“Rehda has called upon the government to address these issues swiftly, as the current situation will be detrimental on various levels, including to purchasers.”

“Should these issues be addressed, we believe that the second half of next year will paint a better picture for the industry and the nation as a whole,” Rehda said. — Bernama

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