KUALA LUMPUR: Supply overhang in Malaysia’s residential property sector is on the rise, with the first half of the year mainly denominated by units priced between RM200,000 and RM300,000, which are commonly perceived as “affordable”.
According to the National Property Information Centre (NAPIC), the six-month period saw 32,810 residential units worth RM19.76 billion unsold, 1.5 per cent more than the 32,313 unsold units worth RM19.86 billion recorded in the first six months of 2018.
This is despite a fewer number of new launches in this year’s first half, which saw 23,591 units came to the market, almost halved the number of units launched in the same period last year.
Deputy Finance Minister Datuk Wira Amiruddin Hamzah said Malaysia’s overhang situation had been on an uptrend and this time, it mainly involved residential properties commonly categorised as affordable.
"This is something that perhaps we didn't expect. We thought that overhang homes were those that are priced above RM1 million but actually most of them are condominiums and priced at RM200,000 to RM300,000, which are categorised as affordable houses," Amiruddin said at the real estate market briefing for the first half of 2019 here today.
Based on the latest data by NAPIC, the majority of overhang homes are priced at RM200,001 to RM300,000 (22.3 per cent), followed by RM300,0001 to RM400,000 (17.5 per cent) and more than RM1 million (12.8 per cent).
Amiruddin said the housing supply must be consistent with demand and that mismatches should be minimised.
“I recommend that both developers and authorities who approve development projects and property prices pay attention to this overhang data.
“It is imperative for developers and the relevant authorities to ensure that the homes built are able to meet the demand of the location at a reasonable price to the buyers,” he said.
For the first half of this year, there were 99,922 transactions worth RM34.65 billion in the residential sector, an increase of 6.1 per cent in volume and 9.5 per cent in value.
Including the non-residential, the whole property sector recorded 160,172 transactions worth RM68.3 billion, representing a 6.9 per cent increase in volume and 0.8 per cent in value as compared with 149,862 transactions worth RM67.74 billion in the same period last year.