Property mart expected to shake off lethargy next year

Posted on | August 20, 2008

By BUSINESS TIMES

For the first half of this year, the rising costs of building materials and fuel have also impacted developers’ production delivery, according to a property survey

THE sluggish property market could recover in six to nine months as the supply of materials stabilises and buyers adapt to the higher cost of living.

“In 2009, the cloud will be clearer,” said Datuk Michael K.C. Yam, chairman of the Real Estate and Housing Developers Association (Rehda).

Buyers are cautious about buying property after Malaysia hiked the petrol price by 41 per cent in June. Some are having problems getting financing as banks are more strict when giving out loans due to the tougher economic outlook.

“When there is certainty in fuel price and there is regular cement and steel supply at market driven prices, I think people can plan better,” Yam told reporters at a briefing in Kuala Lumpur yesterday.

Construction and operational costs have jumped by 30 per cent and 20 per cent each respectively, resulting in prices of new launches increasing by about 20 per cent.

According to Rehda’s Property Survey for the first half of this year, the rising costs of building material and fuel have also impacted developers’ production delivery.

“Most members reported having difficulties in getting consistent supply of building materials besides their continuously rising price, especially steel and cement,” Yam said.

Rehda, with over 1,000 members under its belt, had 135 respondents for its survey, comprising housing and property development companies.

More than half of the respondents said they are launching new projects for the second half of this year. However, new launches in the first half of the year were almost halved compared with the same period last year.

The average number of units to be launched per developer in the second half of this year is 152 units, lower than the 169 units in the same period last year.

You might also like

Rising building material, labour and hidden costs main concern for Johor developers By THE STAR JOHOR BARU: Escalating prices of building materials, higher manpower costs due to shortage...

Malaysia housing market to pick up steam in first half By BUSINESS TIMES THE local housing market is expected to gather steam in the first half of this year,...

Mah Sing sees RM560m sales By THE STARIt is selectively bullish about property sector in 2008 and 2009KUALA LUMPUR: Mah Sing Group...

New ideas to beat higher costs By THE STARDevelopers urged to be innovative and seek other alternatives KUALA LUMPUR: The rising cost...