KELANA JAYA, Oct 12 — Malaysian developers remain mostly neutral about the property industry’s outlook and the economic environment in the second half of 2022 (H2 2022) and H1 2023, the Real Estate and Housing Developers’ Association Malaysia (Rehda) said.
Of the 150 developers who responded to the Property Industry Survey H1 2022 and Market Outlook H2 2022/H1 2023 released on Wednesday, only 20 per cent and 24 per cent were optimistic about the domestic economic environment, and the industry’s business prospects for the second half of 2022, respectively.
“The outlook is less optimistic than before, but Rehda members continue to be committed to our nation-building role for the benefit of all Malaysians,” Rehda president Datuk NK Tong said during the Property Industry Survey and Market Outlook presentation here today.
“However, respondents are not hopeful about next year’s consumer purchasing power,” Tong said.
According to the survey, 48 per cent of the respondents are not planning any launches in the second half of this year, mainly due to delays in approval from authorities and projects in the planning stage, lack of suitable location, business constraints, a higher number of unsold units and low buyer’s demand in the project location.
The survey showed that 52 per cent plans to launch in the second half of this year comprising 7,459 landed residential units, 7,224 strata residential units and 275 commercial units, with 66 per cent anticipating sales performance to be 50 per cent and below for the first six months after the launch, said Tong.
“Price-wise, except for Kelantan, Melaka, Johor, will be within the RM250,001 and RM500,000 range.
“Melaka aims to launch units priced between RM100,001 and RM250,000, Johor between RM700, 001 and RM1 million, while Kelantan has no planned launches,” he added.
Based on the survey, the respondents have also reported that the overall costs of business operations have increased to 17 per cent in H1 2022, with the main cost components affecting cash flow being materials and labour cost, compliance and land.
“The majority of the respondents said they were affected by the current economic scenario and had taken several cost-cutting measures both operation- and production-wise, including freezing recruitment, reducing salaries, rescheduling the launch of planned projects and reducing the scale of launches,” he added.
According to the survey, the average percentage increase in the price of building materials such as metal products is 32 per cent, aluminium 24 per cent, glass 23 per cent, steel 20 per cent, timber 19 per cent, concrete 17 per cent, sand 15 per cent and cement 13 per cent.
Respondents are also anticipating an average 18 per cent rise in construction costs in the second half of 2022 and beyond, which could impact property prices going forward.
Meanwhile, the survey also showed that the number of units launched in the first half of 2022 has decreased by 26 per cent to 7,843 units from 10,665 units in the second half of 2021, with two- and three-storey terraced houses dominating most of the launched and sold units.
Commercial launches, however, rose significantly to 474 units in the first half of 2022 versus 34 units in the second half of 2021.
The survey showed that 55 per cent of the respondents have unsold housing, while 38 per cent, unsold commercial units.
Among the top reasons for unsold residential units are end-financing loan rejection, unreleased Bumiputra lots and high pricing/low demand or interest.
— Bernama
