THE property market in Johor, which has the highest number of unsold stock, is not expected to improve anytime soon as demand — even for subsale houses — for 2019 declined due to the ever-increasing supply.

According to iProperty.com.my’s 2019 portal demand analytics, demand for houses in the state dipped 12.2% year-on-year (YoY).

Demand for terrace houses decreased 12.7% YoY, condominiums fell 10.9%, while serviced residences went down 10%. However, the median price of residential properties in the state increased 3.8% YoY to an average of RM350,000.

Terrace houses and serviced residences recorded a growth in median price of 5.37% and 0.06% YoY respectively, while the median price for condominiums reduced by 3.27%.

The average price of a terrace house in the southern state was RM350,000, condominium was RM360,000, while serviced residence was RM350,000.

As such, REA Group Asia customer data solutions GM Premendran Pathmanathan said Johor is currently a buyers’ market.

“The demand in Johor subsale market decreased in 2019 as the number of listings continued to grow, exceeding the unique visitors on our website.

“The listings which kept coming in — due to the vacant positions entering the market last year — outgrew the number of unique visitors,” he told the media at iProperty.com.my’s exclusive industry analysis presentation in Kuala Lumpur (KL) last week.

Premendran said there are still buyers in Johor — as shown by the capital growth recorded by residential properties — but not enough for the huge supply in the state.

On the other hand, the demand for KL residential properties increased 19.8% YoY in 2019, while the median price declined 1.61% with an average of RM516,000.

Demand for terrace houses in KL jumped 18.5% YoY, condominiums climbed 17.2% and serviced residences improved 16.2%.

Terrace houses in KL were the only segment posting capital growth of 1.58% with an average price of RM770,000 in the year, while capital growth for condominiums and serviced residences dropped 2.99% and 3.08% YoY respectively.

Premendran said the increase of demand for subsale properties last year was partly due to the decrease in listings, on the back of Budget 2019’s real property gains tax (RPGT) ruling.

In Budget 2019 announcement, the government raised the RPGT rate — for the disposal of property held for more than five years by Malaysian citizens — to 5% from 0% effective Jan 1, 2019.

“From the moment the new ruling was announced, there was a huge sale in the subsale market right up to December 2018. Everyone was rushing to sell their properties before the rule was imposed.

“By Jan 1, 2019, those who were not able to sell their homes decided to hold their listings and started to pull out,” Premendran said.

In Budget 2020 announcement, the government revised the base year for RPGT to Jan 1, 2013, for assets acquired before the date, from Jan 1, 2000, previously.

The change translates to lower tax payment for homeowners who want to dispose of their properties.

“Those, who are holding their listings now, can sell their homes with lower tax. Based on that, we are looking forward to listing coming back this year,” Premendran said.