Property developers should be cautious and not overbuild just because the property market appears to have bottomed out in the second quarter, said Real Estate and Housing Developers Association (Rehda) president Datuk Ng Seing Liong.
Developers were optimistic of a stronger uptake of properties in the second half of the year as the property market appeared to be recovering, he said.
“But they should remain cautious and not overbuild,” he told reporters at the 20th National Real Estate Convention themed Recalibrating the Fundamentals in the Malaysian Real Estate Market yesterday.
Ng noted that many developers were still worried about clearing their inventory and reducing property overhang.
Real Estate and Housing Developers Association president Ng Seing Liong the keynote speaker at the 20th Natinal Real Estate Convention in Kuala Lumpur yesterday.“Their concerns include completing on-going projects in time, softening property prices and high marketing expenses,” he said.
At the end of the first quarter, the housing property market recorded 544,926 units of incoming supply against 669,554 units of planned supply, Rehda figures showed.
The number of completions and starts of residential projects increased in the first quarter, but new building plan approvals had dwindled, compared with the fourth quarter last year, according to Rehda.
“With the property market improving, developers need to be innovative, creative and focus on what the market demands. It’s good to see some developers embracing the green concept in the construction of buildings,” Ng said.
A Rehda survey in May on 105 developers from peninsular Malaysia showed that 32% respondents launched new projects in first half of the year while 68% did not.
The survey said 30% of the 105 developers experienced “static performance” in their launches, while 38% reported worsening sales with a majority stating that they had experienced a 30% or more reduction in sales.
Source: The Star 18 August 2009
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