KAJANG (April 4): Residential properties accounted for the major chunk of property market transactions in Malaysia in 2021, totaling 198,812 transactions worth RM76.9 billion recorded during the year.

This represented 66.2% of the total 300,397 property transactions recorded in 2021 and 53.1% of the total property value transacted of RM144.87 billion, based on data released by the National Property Information Centre (NAPIC), which operates under the Finance Ministry’s Valuation and Property Services Department (JPPH).

In a media statement released in conjunction with the launch of the 2021 Property Market Report by Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz on Friday (April 1), NAPIC said the residential sub-sector posted a 3.9% year-on-year (y-o-y) increase in volume and 16.7% in value.

“The improvement was supported by the uptrend recorded in Kuala Lumpur (4.9%), Selangor (10.7%), Pulau Pinang (16.3%) and Perak (3.2%),” it noted.

Meanwhile, Johor recorded a decline in market activity by 2.4%.

Selangor contributed the highest volume and value to the national market share, accounting for 24.5% of the total 48,755 transactions, and 34.4% of the total transaction value of RM26.49 billion.

Kuala Lumpur recorded 11,129 transactions and ranked second highest in value at RM9.69 billion, contributing to 12.6% of the national total.

Demand remained focused on terraced houses, which accounted for 43% of total residential transactions, followed by vacant plots and high-rise units, each with nearly 15% market share.

Notably, over half of the sold residential properties were priced RM300,000 and below.

Demand for properties priced RM300,000 and below accounted for 55.9% of the total, followed by those priced between RM300,001 to RM500,000 (24.6%), RM501,000 to RM1 million (14.8%), and those priced more than RM1 million (4.8%).

On the trend in house prices, the Malaysian House Price Index (MHPI) stood at 201.5 points in 2021, marking a marginal 0.6% growth.

Overall, the Malaysian property market showed improvement in 2021, as total transactions increased 1.5% y-o-y to 300,497, while total transaction value grew 21.7% y-o-y to RM144.87 billion.

Developers must conduct feasibility study before execution — Zafrul

The overhang in the residential segment worsened in 2021, rising 24.7% to 37,000 units, valued at a total RM22.79 billion, NAPIC data showed.

“I call on developers and authorities, including the state government, to cooperate and pay attention to the overhang data released by NAPIC. This is very important in ensuring that the project to be developed is in line with market demand, as well as ensuring a reasonable selling price to the public,” said Zafrul.

“(Also,) I would like to call on developers to develop a project based on a feasibility study. Any decision should not be based on speculation on real estate market expectations alone,” he added.

Of the total unsold units, about 55% (20,505 units) are condominium/apartment forms, followed by terraced houses at 21.3%.

Ironically, NAPIC said houses in the affordable price range of RM300,000 and below formed the majority (31.5%) of unsold units, followed by RM500,001 to RM1  million (30.2%), RM300,001 and RM500,000 (25.7%), and more than RM1 million (12.6%).

Source: EdgeProp,  April 4, 2022