Slowdown in property sector expected due to moderate GDP growth
The property sector is expected to see a further slowdown this year on the back of various challenges and in view of a projected moderate gross domestic product (GDP) growth as compared to 2015. Deputy Finance Minister Datuk Chua Tee Yong said the sector had already experienced a slowdown last year with the volume of transactions falling by 5.7 per cent, amid uncertainties in the global market. However, he added that the Malaysian economy remained resilient supported by strong fundamentals, ample buffers, a robust financial system and efficient government policy. Chua said the estate agency profession had continued to expand exponentially with some already promoting properties overseas and placing Malaysia on the radar of various countries. Nevertheless, he remarked that there are still unhealthy practices within as agents compete among themselves. In conjunction with the the graduation ceremony of the Board of Valuers, Appraisers and Estate Agents (BOVAEA) Malaysia on Friday, BOVAEA had launched two documents, namely the second edition of the Property Management Standards and Accreditation Manual. (Bernama)
More affordable houses needed, says BNM Governer
Newly-appointed Bank Negara Governor Muhammad Ibrahim said there is a need for a larger supply of affordable homes, both for sale and for rent. He said the problem with home ownership was not the availability of loans, but the availability of affordable houses. Based on Bank Negara calculations, those who earned RM5,000 and below a month could only afford a RM130,000 house. “We are looking not only at people owning houses, but also renting houses, as seen in more developed markets,” he said. About 84 per cent of house buyers are first time buyers who did not have problems in getting bank loans, but there was a serious lack of cheap housing options. House prices in Malaysia continue to rise, but at a slower pace this year. Housing transactions are slightly down and residential construction activity is slowing. (Free Malaysia Today)
Image source: Paultan.org
IJM, MRCB among winners of MRT work packages worth RM4.2bil
IJM Corp Bhd and Malaysian Resources Corp Bhd (MRCB) are among the winners of the latest four packages of mass rapid transit (MRT) contracts for the Sungai Buloh-Serdang-Putrajaya (SSP) Line, worth a combined RM4.2 billion. IJM’s RM1.47billion contract is to build a 4.6km viaduct guideway and other associated works from Jinjang to the Jalan Ipoh North Portal, while MRCB bagged a RM648 million contract to build a 2.6km viaduct guideway and other associated works from Persiaran Apec in Cyberjaya to Putrajaya Sentral. The biggest contract, a systems work package worth RM1.62 billion, went to the consortium of Hyundai Rotem Co and Posco Engineering Co Ltd from South Korea and Malaysian company Apex Communications Sdn Bhd. A consortium of Bombardier Malaysia Sdn Bhd and Global Rail Sdn Bhd won the other systems work package worth RM458.02 million for the engineering, procurement, construction, testing and commissioning of the signalling and train control system. (New Straits Times Online)
Tropicana’s online property bid a hit
Malaysia’s first online property bidding campaign by Tropicana Corporation Bhd has yielded the highest social media engagement on its Facebook page, and received more than 170,000 views for the video on its bidding website. The “Just Bid It” campaign, the developers second digital campaign, lets registrants bid for five properties from April 1 to May 20. Three successful bids have been made so far, and the winners are now in the process of banking documentation. Law Yong Hong, who made a successful bid for a Parkfield Residences house at Tropicana Heights, Kajang said he had learned about the contest through the developer’s Facebook page. Another lucky bidder, Seow Chee On, won the bid for a Bayan Residences terrace unit at Tropicana Aman, Shah Alam. (The Star Online)
Growing interest in financial planning among young Malaysians
There has been growing interest among young Malaysians to use financial planning services as well as considering it as a career, said the Malaysian Financial Planning Council (MFPC). President Md Adnan Md Zain said the industry has been progressively growing in line with the people’s increasing awareness of the importance of financial management, driven by a challenging economy and volatility in commodity prices. There are currently over 1,000 financial planning practitioners in Malaysia, a relatively small number for Malaysia’s population size, compared with 4,000 practitioners in Singapore. There is also increasing interest in property investment because of the long term appreciation that can be gained from it. (Astro Awani)
SP Setia 1Q net profit at RM123mil, plans RM3bil launches
SP Setia Bhd recorded a net profit of RM123.39 million in the first quarter (1QFY16) and is poised to launch RM3 billion worth of properties in the financial year 2016 (FY16). The property developer’s revenue stood at RM908.5 million, mainly contributed by a 86% take-up rate of its two projects in Setia Alam with a gross GDV of RM128 million. The group’s 3-storey terraced house and semi-detached house projects in Setia Alam showed good take-up rate, which indicated that demand was still strong. SP Setia’s upcoming major launches this year include Setia Eco Templer in Selayang (RM269mil), Setia EcoHill 2 in Semenyih (RM512mil), Carnegie in Melbourne (RM91.53mil), KL Eco City in Bangsar (RM444mil), Setia Sky Ville in Penang (RM477mil), Setia Sky Seputeh in Kuala Lumpur (RM406mil), Setia Trio in Klang (RM351mil) and Setia Business Park II in Johor (RM127mil). (The Edge Markets)
Hua Yang expects flat earnings growth for FY16
Hua Yang Bhd, which is focusing on the affordable property sector, is confident it will be able to achieve its lower annual sales target of RM400 million in the financial year ending March 31, 2016 (FY16), and that its performance will be comparable to FY15. The group’s net profit rose 34.55% to RM110.56 million in FY15, as revenue increased 14.45% to RM583.58 million from 509.89 million a year prior. It has already reported a 9.73% increase in net profit for the first nine months ended Dec 31, 2015. However, the company’s property development segment saw its revenue and profit before tax dip 0.3% and 7% respectively in 3QFY16, compared to the previous year’s corresponding quarter, due to lower sales achieved. The group remains optimistic on its prospects for FY17, as demand for affordable housing remains strong. (The Edge Markets)
