When Sr. Norhisham of JPPH was presenting his slides, I think some participants in the REHDA Institute’s Big Data & Analytics for Sales & Marketing Conference may be disagreeing. His slides show some positivity with the market but the market situation should be otherwise, no? There are still people who thinks that transactions continue to go down since banks are not lending? It seems that 2018 may have been a turning point since 2013? Instead of debating, perhaps we look at a few key slides from Sr Norhisham from JPPH.
#1 – Instead of the yearly drop, we could see a very slight increase in both the volume (units) and the value (RM) for 2018 when compared to 2017. Would 2019 be mirroring 2016? That will be great but let’s wait for 2 more quarters to get a better picture of what’s really happening.
#2 For a closer understanding, in percentage terms.
#3 – The overhang is the most serious in Johor (18.8%) followed by Perak (16.6%) and Selangor (14.5%). As soon as we include serviced apartment, the overhang in Johor looks worrying at 65.8%. KL appears at number two with 16.7% followed by Selangor at 11.4%.
#4 – Overhang by property type in 2018 showed that the top is high-rise units at 14,031 but I think what’s most interesting is that the 2-3 storey terraced homes are not that far behind because total number built is much lower than the high-rise units. There are 9,273 overhang units. For families looking for landed properties, I think it’s worth taking up this opportunity where the buyer will be more powerful than the seller.
#5 – Sale performance in 2018 is also slightly better than 2017. New launches meanwhile dropped significantly for Kuala Lumpur where there are 56% fewer launches in 2018 versus 2017. Selangor also showed a slight drop of 10% versus 2017. Developers are possibly aiming to sell their existing stocks instead of launching new ones.
#6 – It’s very important to believe in what we buy and not be swayed too much about how landed is always better than high-rise for example. Looking at the House Price Index would reveal that someone who bought a terrace home in 2010 has gained more than double where prices are concerned by the end of 2018. High-rise units have risen by close to double while the other landed types rose over 70 index points.
#7 – On an overall basis, the Malaysia House Price Index has showed a rise of 93.3 Index Points from 2010 to 2018. Even if we assume the growth to be slower moving forward, home remains a very good and important investment everyone must have.
There are many more slides which was shared. If you need the full presentation, Please download the full presentation of Sr. Norhisham slides here.
Next suggested article: Retail and Office Supply. An Update here.