Trend of Malaysian moderately-priced houses

Moderately-priced houses in trend

By DAVID TAN davidtan@thestar.com.my

THE trend of developing residential properties priced between RM200,000 and RM400,000 is picking up in Penang, a state where property prices are second highest in the country after Kuala Lumpur.

Tambun Indah Land Bhd, PLB Engineering Bhd, Ideal Property Development Sdn Bhd, and Belleview Group are some of the Penang-based developers with plans to launch moderately priced projects on the island.

With the exception of Belleview, Tambun Indah, PLB, and Ideal Property are taking advantage of the plot ratio guidelines introduced in 2010 which allowed developers to build 87 units per acre, with a total built-up area of 122,000 sq ft per acre and priced at between RM200,000 and RM300,000.

Geh says the demand for houses comes from newly-weds, families and retired couples.

Under the revised guidelines, developers have to allocate 5% of the total units in a development scheme to be priced at RM200,000, 10% to be priced at RM300,000, and 5% not exceeding RM500,000.

Tambun Indah's Straits Garden in Jelutong, PLB's Sungai Nibong Residences and Ideal Property's Valencia Park are the new projects using the revised guidelines.

The layout plans of the projects have been approved and the company is now waiting for the go-ahead for the building-plans.

Previously, the plot ratio guideline for high-rise was 60 units per acre or 42,000 sq ft per acre or 30 units of 1,400 sq ft apartments.

The revised plot ratio guidelines are applicable in areas where it is allowed to develop 30 units per acre and above and in areas designated as commercial/tourism areas under MPPP's structural planning and development control plan.

They are not applicable for prime residential areas such as Jalan Tunku Abdul Rahman (popularly known as Ayer Rajah Road), Jesselton area, existing established housing zones and general housing areas, George Town Heritage Site (which includes the buffer zone), certain areas in Tanjung Bungah and Tanjung Tokong.

Real Estate and Housing Developers' Association (REHDA, Penang) chairman Datuk Jerry Chan said the new plot ratio guidelines for the island was a win-win situation for both the developers and the state government.

Ho says the RM100mil Autumn Tower project does not come under the new guidelines.

“The guidelines make the developers supply affordably priced properties and in return the developers get to better utilise the land for development,” Chan said.

Tambun Indah is proposing to develop a RM180mil high-rise residential project called Straits Garden in Jelutong on a 1.69ha site, the north-east district of the island, with 15% of the total units priced between RM200,000 and RM300,000.

Tambun Indah managing director Teh Kiak Seng said the project's layout plan had been approved and was now waiting for the building-plan approval from the relevant authorities.

“The project located in the heart of the island and would feature modern apartments, office suites and shop lots to meet the demand for commercial and lifestyle properties in the central business district.

“We anticipate to commence development in the fourth quarter of the year. Targeted completion is by the fourth quarter of 2014,” he added.

In Sungai Nibong, which is close to the Penang International Airport, PLB plans to launch the Sungai Nibong Residences, comprising 98 units of medium-cost apartments on an over 0.4ha site.

PLB executive chairman Datuk Ong Choo Hoon said the project has a gross development value (GDV) of RM70mil and was expected to be launched in the third quarter this year.

Some 15% of the total units would be priced between RM200,000 and RM300,000 in accordance with the conditions of the revised plot ratio guidelines.

The lay-out plan of the project had been approved and is now waiting approval for it's building plan.

Ideal Property also plans to launch 788 apartment units called Valencia Park on a 9.1-acre site in Relau, south-west district of the island in September.

Ong says the Sungai Nibong Residences is expected to be launched in Q3.

Ideal Property managing director Datuk Alex Ooi said the project, which had a GDV of RM330mil, comprised apartments with built-up areas of 1,000 sq ft and 1,200 sq ft.

In the past two years, Ideal Property had developed and sold over 500 units of apartments priced between RM300,000 and RM400,000 in the south-west district.

Belleview's RM100mil Autumn Tower project, comprising 220 condominiums at All Seasons Park in Bandar Baru Air Itam, does not come under the new plot ratio guidelines.

“The project is scheduled for launch in May 2012.The pricing for the units ranges between RM350,000 and RM400,000”, said Belleview managing director Datuk Sonny Ho.

Meanwhile Raine & Horne Malaysia director Michael Geh said the sub-sale transactions of high-rise properties priced between RM300,000 and RM400,000 were very active in the south-west district of the island in Relau, Bukit Jambul, Bayan Baru, Bayan Lepas, and Sungai Ara.

“Properties in these locations have been steadily rising at about 10% per annum,” Geh said, adding that there was strong take up for newly-launched properties in the first two months of 2012.

“We observed that the demand came from newly-weds, families that want to upgrade their lifestyle, and retired couples looking for smaller high-rise properties in prime locations,” he said.

In Seberang Prai, Asas Dunia Bhd is undertaking some 1,357 units of landed properties this year with a GDV of RM226.7mil in Central and South Seberang Prai.

Ooi says Valencia Park, comprising apartments, has GDV of RM330mil.

Group managing director Chan said the price ranged between RM120,000 and RM580,000, depending on the type of property and the location.

The properties comprised largely single-storey terraced, single-storey semi-detached, and single-storey bungalow houses.

Over the past two years, the prices of residential properties have increased from 10% to 15% per annum on the island, making properties in the RM200,000 to RM400,000 price range increasingly rare.

Prime Minister Datuk Seri Najib Tun Razak had last July launched the first phase of 1Malaysia Peoples' Housing (PR1MA) programme, under which residential properties priced between RM150,000 and RM300,000 would be developed.

PR1MA is specifically for first time house buyers and moderate-income Malaysians earning not more than RM6,000 monthly regardless whether they work with the government, the private sector, or self-employed.

Some 42,000 houses under PR1MA have been identified for 20 sites in the Klang Valley, Rawang and Seremban, and companies like Sime Darby Bhd, SP Setia Bhd and Putrajaya Corp have been invited to participate.

In the last budget announcement, the federal government also raised the ceiling price for first home scheme buyers to RM400,000 from RM220,000 with 100% loan financing and stamp duty exemption to promote home ownership among the middle-income groups.

As Sime Darby owns a large bulk of land bank in Penang via Eastern & Oriental Bhd, the state could be a site for moderately priced housing projects under PR1MA.

Eastern & Oriental Bhd is reclaiming 740 acres for the second phase of the Seri Tanjung Pinang project in Tanjung Tokong to develop two islands for mixed development projects, which will have a GDV of RM12bil.

 Related post:

Invest in Malaysia's Real Estates 

Invest in Malaysia's Real Estates

Malaysia a real-estate shopping destination  

By THEAN LEE CHENG

Welcoming foreign buyers will not necessarily affect property prices

LATE last year and once again about two weeks ago, at least two courses were organised to equip property agents and developers to sell Malaysian properties abroad.

In one of them, real estate professionals paid a few thousands of ringgit to attend a Certified International Property Specialist (CIPS) course to prepare them to sell Malaysian properties overseas. In another, a tax consultant and a lawyer were invited to share their experience and expertise when selling Malaysian properties.

Tan: ‘Our properties are very affordable to Singaporeans. In the region, our real estate is attractively priced.’

 

For about a decade now, developers who have projects around the KLCC area, Penang and Johor have been taking their offerings to Singapore, Hong Kong, Japan, London and China. So far, these overtures have been limited to residential and commercial developments. On a broader scale, the Malaysian government has also been encouraging foreigners to buy into Malaysian realty and has started networking with governments and local authorities to make itself known via government agency Malaysia Property Inc.

The question is: will foreigners buying into Malaysian real estate encourage developers to focus on building high-end developments, which are way above the affordability levels of locals?

Invariably, references are made to Singapore and how foreign buying has brought in that element of volatility because at the first sign of trouble, the foreigner leaves the island state.

Malaysia Property Inc (MPI) chief executive officer Kumar Tharmalingam likes to debunk this: “The number of foreign buyers buying into Malaysian properties is very small. Sales to foreigners only make up 2% of total property sales in Malaysia compared with Singapore's 30% . Singapore's volume of properties entering into the market annually is about 20,000 units and foreigners are only allowed to buy private condominiums; which averages about 6,000 units.

“Malaysia has about 120,000 units entering the market annually and 2% of this is 2,400 units.”

Kumar also says it is not possible to compare Malaysia with Singapore and Hong Kong and the market dynamics are very different.

MPI was set up in 2008. The government-property agency has two core objectives: to create international awareness and to establish connections between foreign interests and Malaysian real estate industry players. Its scope of work is not limited to just residential and commercial properties but includes the whole gamut of property investment, from land acquisition to building of factories if this is needed by the foreign investor. MPI has been branding itself for the last 18 months. This year will see the agency implementing some of their strategies when it matches foreign companies with Malaysian projects.

“MPI and much of what we would like to do is still pretty much work-in-progress,” says Kumar who took over the reigns of the agency in Feb 2010.

“MPI is an extension of three government agencies. These are national trade promotion agency Matrade, International Trade and Industry Ministry and Malaysian Investment Development Authority,” he says.

MPI's work is very much tied up with the foreign direct investment. The foreign direct investment will first seek out one of the above three agencies. After that connection is made, and when a foreign investment is approved by the government, there will be a need for land or office space, or even accommodation for staff.

Kumar: ‘Sales to foreigners only make up 2% of total property sales in Malaysia. Of the 120,000 units entering the market annually, 2% is 2,400 units

“There is a time lag between the foreign investor applying for government approval for his investment and his need for real estate. But which ever way one looks at it, land, office building, factories or staff accommodation, real estate comes into the picture. Because these three agencies are not involved in property matters, the requirements of these investors will be eventually be be referred to MPI.

“Or it could be a foreign direct investor who is keen to enter into a joint venture with our local boys. The South Koreans, for example, are keen to contribute a certain amount of equity, but would like to negotiate' a tender as opposed to having an open tender. This was the model they used in Vietnam and China for their real estate investments.” Its role is to facilitate.

With the United States' fragile recovery and Europe going through a recession, Kumar expects interest in Malaysian properties to come mainly from Japan, South Korea, Hong Kong, South China, Singapore, Indonesia, India, Saudi Arabia and Qatar.

Whether it is a coincidence or otherwise, the same year MPI was set up, news of the Government's plans to develop several pieces of land in key strategic areas in the city began to filter out. These mega projects include what is currently known as the Kuala Lumpur International Financial District in Jalan Tun Razak, KL Metropolis in Matrade-Jalan Duta area, the 100-storey building in the Stadium Negara site, now known as Menara Warisan and the Rubber Research Institute land in Sg Buloh. The global financial crisis, which started in 2007 and whose full blown effect was felt around the world, came a year later.

While MPI plays an intermediary role to facilitate the business needs of the real estate, concerns about foreign interest pushing up prices are also pooh-poohed by Reapfield chief executive officer Gerard Kho. On the contrary, he says there are a few locations that need the support of foreign buyers.

“The high-end condominium market need the support of foreign buyers. This year, we expect to see rent and prices adjust a bit in that sector. It will also be a challenging year for the high-end condominium market.”

By contrast, domestic demand is expected to remain resilient.

“I am bullish up to the middle of this year despite the 30% downpayment requirement for the third and subsequent house and other measures by Bank Negara to curb the growth in household debts. The third and fourth quarter are difficult to predict,” he says.

“Last year, 84% of our transactions were from the secondary market, a reflection of strong domestic demand despite the many predictions of 2011 being a difficult year,”

Following up on Kho's concerns about the high-end condominium sector, the National Property Information Centre's Residential Property Stock Table shows the Federal Territory having an existing stock of serviced apartments and condominiums totalling 156,251 units including about 4,000 units completed last year.

While these numbers do not separate the high-end units from the rest, it does indicate the large number of serviced apartments and condominiums in the Federal Territory and the yearly additions that enter the market.

About 5,000 units were added into the market this year and another 4,500 units are expected to stream in next year, says Kho.

On the often quoted Singapore-Malaysia example, Kho says the “Singapore and Hong Kong property markets have a high global exposure. Both these markets are very different from Malaysia in terms of land, and government-control measures.

“In Singapore, foreigners are allowed only to buy into private condominium projects. Malaysia is different. Foreigners can buy into any segment of the property market if it is beyond a certain price threshold, which dilutes the focus on any particular sub-segment of the property market,” says Kho.

Lawyer Chris Tan who acts on behalf of foreigners buying into the Malaysian market says his biggest clientele are from Singapore.

“Our properties are very affordable to them because of the exchange rate and because of the high prices in the city state. In the region, our real estate is attractively priced,” he says.

The locations his clients buy into include the KLCC area, Mont'Kiara, Damansara, Bangsar and Ampang. Johor and Penang are other popular destinations.

“Iskandar Malaysia is like Shenzhen and Hong Kong. Shenzhen is thriving today because of the Hong Kong factor,” says Tan.

Related articles

•  Bank Negara’s lending guideline is a blessing in disguise?
• Malaysian High-end property expected slower (rightways.wordpress.com)
• Buying a property as a foreign national (holidayhometimes.com)
• Think global or you lose out! Malaysians consumed too much with local affairs! (rightways.wordpress.com)
• Poser over Penang Bayan Mutiara deal

We CAN complain and gripe

Why Not By Wong Sai Wan
 

Making noise or raising a stink is fast becoming a national trait as we Malaysians gripe about everything and anything.

EVER heard the story of the Singaporean who wanted to migrate to Malaysia, causing the republic to order an immediate inquiry to find out why?

Inquiry chairman: “Tell us Mr Michael, you are migrating to Johor Baru because your Malaysian wife is unhappy living in Singapore?”

Michael: “No. She got nothing to complain about.”

Inquiry chairman: “Then, is it because you were overlooked for a double promotion in your job, and you only got a S$1,000 (RM2,400) pay rise?”

Michael: “No. I got nothing to complain about.”

Inquiry chairman: “So, Mr Michael, it must be because your son was refused entry into NUS, and only got a place at Nanyang?”

Michael: “No. He has got nothing to complain about.”

Inquiry chairman: “Then, for heaven’s sake, tell us why are you migrating to JB?”

Michael: “Because there I CAN complain.”

A Singaporean friend told me this joke five years ago, just before our last general election. This friend, who is very knowledgeable about the situation here, used this tale to take a dig at his own country, and ours as well.

His point was that while in his home country his countrymen were rather subservient and did not complain much in public, Malaysians had no such problem. Grumbling and griping seem to have become a national sport.

If we were to consciously listen to anyone standing or sitting next to us, we will see my friend is not far from wrong.

We Malaysians love to complain about anything; be it food, the Government, bosses, colleagues or even our neighbour’s choice of colour for the new coat of paint for his house.

Nothing is above criticism in Malaysia. These criticisms are not the kinds made on the quiet, but rather openly and sometimes rather loudly.

You know, the coffee shop type where you have to raise your voice because you can hardly hear yourself?

But in the case of us Malaysians, we complain at the top of our voice because we are afraid no one will hear, or we want to make sure everyone knows what we are complaining about.

A colleague said the complaining culture had gotten so bad that it had become griping, which dictionaries define as “to complain naggingly”.

“This is a sort of graduation for us Malaysians – from surat layang (poison pen letters) to publicly complaining about something,” this seasoned journalist said.

An example is griping over trivial things like lack of parking space in over-packed malls.

It beats me why a person would queue for over an hour to get into the parking area and then complain about the lack of parking, when it was obvious from the start that it was packed.

Then there are the infamous Malaysian drivers who complain about everyone else’s driving but their own.

They complain about how others drive too fast, and also about how others drive at a snail’s pace.

There are those who complain about everything and anything connected with their boss – from his choice of office furniture to his choice of ties.

When their verbal complaints do not evoke the desired results, Malaysians will turn to social media like Twitter and Facebook to express their angry thoughts to the whole world.

They do not seem to care if what they utter or write is rude, unethical or downright defamatory.

They seem to think that anything they write on the Internet is above the law.

When the gripes reach the notice of their bosses or the authorities, these people will turn around and say they have the right to express their opinion, but the bosses have no right to legal redress.

I feel that many Malaysians think their mistaken newfound political clout after 2008 gives them the right to say anything they want, without regard for the consequences.

Yes, our Federal Constitution guarantees us freedom of speech but it does not give us the right to run down another person or institution by hounding it with trivial complaints just to exact revenge over some perceived past injury.

Of course, our politicians seem to encourage this kind of behaviour because they see political gains in riding on such waves of dissatisfaction.

They do not seem to realise that their action of encouraging such a mentality only creates distrust, and eventually hatred.

I am not saying that the people have no right to voice their complaints, especially on matters affecting their lives or well-being.

We must voice out our views when it’s needed, but we must get our perspectives right.

We must know the difference between a gripe and a grievance; what’s important and what’s trivial.

If we do not, then our genuine complaints will sound exactly like gripes and the important message that we want to make will be lost, drowned out by the moans and groans.

Being a nation of complainers is not a reflection of the freedom that we enjoy but rather a reflection of ourselves as wimps who can do nothing but just gripe.

> Executive editor Wong Sai Wan doesn’t like nagging but enjoys the sound of an intelligent argument.

I 'do’ is not forever

Putik Lada By Chong Kien Mun

I Do (But I Don't) (Image via RottenTomatoes.com)

The present Generation Y has been immersed in a culture of instant gratification, escapism, and self-centred inflexibility. Couples nowadays do not hesitate to take the plunge into marriage – or out of it.

A COUPLE of years ago, when I first started practising law, I was approached by a soon-to-be-married young couple, who wanted me to prepare a prenuptial agreement for them.

Despite my explanation that prenuptial agreements arguably have no legal effect in Malaysia, they were adamant.

Obviously, some valuable assets were at stake. A sense of numbness enveloped my heart and soul. (Hey, lawyers are mortal humans with emotions, too!)

I could not recall the previous time I actually felt that way. I was filled with a sense of disappointment, of great sympathy. Not for the young couple, but for the sacred institution of marriage.

A couple of weeks ago, amid the scorching Malaysian sun and the beautiful full moon, Valentine’s Day came and went. The roses have now dried, and died.

One wonders whether the couples are still able to wake up to smell love in the air. Or, has real love and genuine affection also died? Perhaps not an overnight death, but a gradual and painful one? And is that a death that should be mourned or celebrated?

It has been said that the longest distance known to man is not the distance between birth and death. Nor is it the distance between the North and the South.

The longest distance imaginable is actually when that person is standing right in front of you, but somehow cannot muster the courage or the opportunity to say that he loves you, and so you don’t even know it.

To those who have been lucky enough to close that distance, it is usually the result of some persistence.

It may sometimes take months or even years for a man to grab that special girl’s hand, and hold it gently but tightly on their wedding day, with primary promises of being a loving husband, and a good father.

However, statistics have shown that, as the years go by, couples evolve from walking hand in hand on their wedding day to walking down the corridors of exile, hands folded or in their pockets.

Here is a riddle for you: “What starts with ‘I Do’ and also ends with ‘I Do’?” Got it? No? It is marriage, which starts with an “I Do” to marry someone, and an “I Do” to divorce that same someone.

The present generation – Generation Y – has been immersed in a culture of instant gratification, escapism, and self-centred inflexibility.

“My way or the highway” is a common statement. Surfing on concurrent waves of escapism, scepticism and pessimism, couples nowadays do not hesitate to take the plunge into marriage – and out of it.

An “I Do” to try it out, and an “I Do” when it does not work out as imagined. It ends just as it began, with the simple “I Do”, which used to be a sacred phrase but is now used flippantly.

There is a fine line between love and hate, for both are forms of interchangeable extremism. Lovers may turn into haters, and vice versa.

As the divorce decree is pronounced, the sourness of love and hate becomes a poison in the respective memories of the individuals involved, which time will seek to erase.

It is difficult to reverse the chain of events once a married couple make arguments and conflict a habit.

Sometimes, conflict becomes such a habit that the couple do not even know what they are fighting about any more.

It gets to the stage where they cannot remember why they accepted each other to begin with, when they had a love to believe in as the foundation of all things beautiful – or so they believed.

At the very least, they used to have a love that they could work on. They see divorce as the only cure.

Sometimes, taking the easy way out is a form of escapism. Form turns into habit and habit evolves into attitude.

An attitude of love is vouchable, while an attitude of escapism only breeds more problems and issues as one escapes from one black hole to a bigger one as the main issues with oneself remain unresolved, unmitigated, and ultimately aggravated.

The alarming divorce rates we see today will inevitably have a domino effect. A Pandora’s box has been opened.

The increasing numbers of single parents bringing up children of broken marriages will potentially lead to the further erosion of the fabric of love and family.

Statistics show that child abusers or molesters usually have had traumatic childhood histories as victims of the offences that they have gone on to perpetrate.

It is not much of a stretch to imagine that children of broken marriages have a higher risk of growing up to break their own marriages.

Back to the young couple that started me on this contemplation about marriage, I told them flatly: “Sorry to be so direct, but the very fact that the thought of such agreements even crossed your mind indicates disturbing elements of doubt and distrust, both essential ingredients of a lasting union. The marriage, if pursued, may not be a lasting one, and I hope to be proven wrong.”

The door was slammed close then. Fast forward a couple of years, and the door was re-opened, the same couple walked in again, asking for a divorce.

Perhaps George Orwell was right after all when he said: “Happiness can exist only in acceptance” or “Men can only be happy when they do not assume that the object of life is happiness.”

> The writer is a young lawyer. Putik Lada, or pepper buds in Malay, captures the spirit and intention of this column – a platform for young lawyers to articulate their views and aspirations about the law, justice and a civil society. For more information about the young lawyers, visit www.malaysianbar.org.my. 

Born on Penang Bridge Leapling Baby

Leapling baby born on Penang Bridge

By ZALINAH NOORDIN zalinah@thestar.com.my 

GEORGE TOWN: This Leap Year has turned out to be a most special one for a young couple from the mainland.

The wife gave birth to a baby girl in a car while travelling on the Penang Bridge.

The mother was being rushed by the father to the Adventist Hospital here at about 6.30pm when her contractions became stronger and before the couple could react, the baby had popped out.

Earlier, she had labour pains at their home on the mainland.

The couple decided to drive over to the island despite know- ing that they could be heading into the after-office hours jam here.

Grimacing in pain and sensing that the baby was about to be born, the wife pleaded with the husband to step on the pedal, hoping that they could reach the hospital in time.

But, before the couple knew it, the baby had emerged safely into the arms of the excited mother.

The husband then drove straight to the hospital located about 15km away from the bridge

A hospital spokesperson who confirmed the case, said that the baby was rushed to the maternity ward for immediate attention and follow-up care.

It was a triple joy for the couple as the child was born in the Year of the Dragon, on a Leap Day and on the iconic Penang Bridge, the spokesperson said.

It is learnt that the overjoyed husband told the hospital staff that he intended to throw a big birthday party every four years for his daughter, whom he regards as having brought blessings to the family due to the unique circumstances of her birth.
 
GEORGE TOWN: Businessman Yeap Ee Sin stepped on the accelerator, racing to bring his pregnant wife to the Adventist Hospital on the island as her contractions became stronger.

Happy family: Yeap and Wong with their leapling baby and older daughter Ying Swenz.

But his daughter was eager to make her debut on Feb 29, the leap day in the Year of the Dragon, so she “arrived” inside daddy's car right in the middle of Penang Bridge.

The hospital was still another 15km away.

“I really didn't expect it. She was supposed to be due on March 8,” said Yeap, 26.

“While I was speeding through the bridge, I said a  silent prayer for my baby to wait until we got to the hospital.

  “But before we could even reach the island, my wife gave out a loud scream and out came the baby's head. The next thing I knew, she was cradling the baby in her arms.

“I guess she just couldn't wait,” said the proud father.

The newborn, who has yet to be named, weighed 2.9kg.

Yeap sped to reach the hospital as the baby's umbilical cord was still intact.

“I was worried that there would be traffic congestion since it was peak hour (at about 6pm) then but thank God it wasn't that bad as I was going to Penang Island from the mainland.

“Imagine if I was coming from the other way?” he quipped.

Yeap said his wife Wong Sok Sim, 26, had earlier been experiencing heavy contractions and he immediately rushed home from work and took her to the hospital.

“Both mother and daughter are safe,” he said.

An overjoyed Yeap told the hospital staff that he would throw a big birthday party every four years for his daughter, whom he felt was a blessing to the family due to the unique circumstances of her birth.

The couple have an elder daughter aged 16 months.