1MDB rebuts WSJ claims of US$1.4bil payments
1Malaysia Development Bhd (1MDB) has rebutted the claims of a Wall Street Journal (WSJ) article, which alleged that US$1.4 billion in payments to Abu Dhabi investment fund, International Petroleum Investment Co (IPIC) was missing. 1MDB reiterated that its financial statements had clearly described the amount and purpose of the payments, which were audited by Deloitte after specific and detailed enquiries. 1MDB stated that it can confirm that IPIC did provide and continued to provide guarantees for the principal and interest of 2 x US$1.75 billion bonds issued, and said that the WSJ article was a sensationalist story, as it did not name its source or provide any proof of the unproven allegations it was making. (Bernama)
Titijaya scales down sales target to RM400m
Titijaya Land Bhd has revised its property sales for the current financial year ending June 30, 2016 (FY16), lowering it to RM400 million compared to FY15’s RM500 million. Unbilled sales of FY15 launches are expected to contribute to its earnings. The group is adopting a cautious and conservative stance due to weak market sentiment and current economic uncertainties. The group plans to launch three projects for FY16, namely H2O, Block B project in Ara Damansara, Emporio Office in Shah Alam and Cheras residential. (The Star Online)
L&G: Expect rise in construction costs
Property developer Land & General Bhd (L&G) foresees a 10-15% increase in construction costs due to the weakening ringgit, which will result in higher prices for new property projects. Costs have been rising over the last two years, and development in terms of the weakening ringgit will have an impact on future contracts awarded, said its managing director Low Gay Teck. There will be an impact on imported construction materials that are quoted in US dollars, even though the bulk of L&G’s construction materials produced locally and under controlled pricing. New projects are expected to be slightly more expensive and adjusted accordingly to the sales pricing. (The Sun Daily)
Lukewarm response from banks for property expo
The Real Estate and Housing Developers’ Association Malaysia (REHDA) has urged banks to play a bigger role in the Malaysia Property Expo (Mapex) 2015. The number of banks participating in the property expo were too few and showed lukewarm response. Only three banks had stated their intention to participate in the three-day expo. Rehda committee chairman Datuk Ng Sieng Liong said that banks should play their role to smoothen the process for first-time home buyers, especially in the current challenging economy, which saw weak sentiment in the market, slower sales and lower home ownership. He also urged the government, financial institutions and developers to work together to aid home buyers. (New Straits Times Online)
House price growth moderate until 2016
AllianceDBS Research said that the growth in house prices may be moderate until next year due to high incoming supply, which will benefit potential house buyers. Although prices will remain firm, property sales will be pressured by the challenging environment. The strong house price appreciation driven by cheap liquidity over the past few years is deemed unlikely to recur in the near future. The incoming supply of property will be the highest in 10 years, which will work in house buyers’ favour. According to data from AllianceDBS and the National Property Information Centre (Napic), as of 2014, there were 66,972 units of unsold stock, the bulk of over 55,000 units being under construction with the rest completed but unsold. (The Sun Daily)
