KUCHING: The state policy change to allow more houses to be built on every acre of land is expected to spur the construction of affordable homes.
Leading property consultant CH Williams Talhar Wong & Yeo Sdn Bhd (WTWY) said the recent approval by the Sarawak Planning Authority to increase development density from eight to 10 units per acre for landed housing and 24 to 30 units per acre for stratified housing would help pave way for more affordable housing to be built as a feasible option for private developers.
It said despite the slowdown in the property market, afforable housing remained in demand and would do well, given a reasonable decent location and type of house.
“As housing is still the mainstay of the property sector being a core basic need, the way to go forward is to focus on affordable housing to meet the needs of the mass population.
“For this purpose, PRIMA was mooted to provide housing priced below RM400,000 to capture a segment of this housing needs,” WTWY said in a property market outlook report. The report reviewed the Sarawak property market in first half of 2016.
The report said during the first six months, the property market was rather flat with much fewer launches of new projects while construction activities had generally slowed down as the market adjusted to weak economic conditions.
“The general consensus regarding the Malaysian property sector in 2016 is that it is going to be a sluggish year, with most (people) preferring not to make long-term financial commitments such as property purchases.
“However, properties in attractive locations are still in demand and despite the lower demand, prices have generally not gone down, albeit even gone up marginally for those in good areas.
“That said, prices of properties which have gone beyond their upper threshold, are expected to remain flat.”
WTWY said property prices, which had surged to new highs in recent years, had pushed up house prices beyond the affordability of the general population. This, it said, had resulted in many new residential areas opening up, mostly in secondary locations, offering cheaper housing alternative.
According to the Finance Ministry’s Valuation & Property Services Department, 2015 continued to record a drop in property volume transacted for Sarawak, compared with 2014 but there was an increase in value transacted due to higher property prices in general.
Last year, a total of 26,375 units of properties valued at nearly RM6.7bil were transacted in Sarawak. Residential properties totalled 10,993 units valued at RM2.46bil or 41.7% of the total. Agriculture properties transacted were 11,170 valued at RM1.87bil. Commercial properties made up 1,914 transactions worth RM1.09bil.
According to WTWY, the Sarawak property market is seeing a lot more strata-titled developers so as to maximise on development costs, for example, mixed development of retail and apartment units especially with the growing urban population in major cities.
In Kuching, it said apartment units made up more than 40% of the residential units under construction.
In terms of units, terraced houses continued to dominate the market between 2010 and 2015. Terraced houses made up 80% of the residential units completed in Bintulu during the last six months, 54% in Kuching and 46% in Miri.
“Despite the slowdown in the general market, house prices continue to uptrend, albeit at a lower rate,” WTWY said..
On market outlook, WTWY said: “The current property market seems somewhat saturated, especially in the commercial and retail sectors.
“With the reduced market demand, property volumes in terms of construction, launches and sales are down.
“The market sentiments will remain weak and demand continue to be low with consumers preferring to wait it out rather than commit on long-term big expenditure items like property purchases.”
“Towns such as Bintulu and Mukah, which were earmarked under the regional development plans for the 10th and 11th Malaysia Plans, namely Sarawak Corridor for Renewal Energy (SCORE), will continue to see growth due to implementation of mega projects,” it added.