The residential property overhang situation in the first half of the year worsened to nearly 32,000 units valued at RM20 billion, up to three per cent from the number of overhang units as at end-2019.
This was revealed yesterday at the launch of the Property Market Report H1 2020.
Deputy Finance Minister II Mohd Shahar Abdullah said the primary residential property market had been impacted given that only about 13,000 units of new residential properties were launched.
Property sales were also week at below five per cent, Mohd Shahar said in his speech which was read by Treasury deputy secretary-general (management) Datuk Othman Semail.
On the overall property market performance, which is measured by the volume and value of transactions, Mohd Shahar said it had declined year-on-year in the first half (H1) of 2020 in line with the country's economic contraction.
In H1 2020, the number of transactions fell 28 per cent to 115,000 units from 160,165 units in the same period last year while the value shrank 32 per cent to RM47 billion compared to RM68.53 billion previously, he said.
The property subsectors, comprising residential, commercial, industrial, agriculture, and development land, contracted between 25 and 37 per cent during the period under review.
Mohd Shahar said the residential subsector drove the market, accounting for over 65 per cent of total transactions.
Look at property overhang data when planning new projects
Mohd Shahar called on developers and the authorities to consider the property overhang data when planning new development projects while also ensuring there is appropriate residential pricing based on the locations.
He said this is to ensure that residential offerings are in tandem with demand and that the supply-demand mismatch is minimised.
"Various policies and initiatives had been introduced to ensure housing prices were under control," he said.
Mohd Shahar noted that the Malaysian House Price Index recorded 198.3 points in the second quarter of this year, a growth of 0.4 per cent versus 1.9 per cent registered in the first quarter.
He said this is seen as a positive indicator for the continued sustainability of housing prices that will benefit house owners and ensure the stability of the country's banking sector.
Meanwhile, Housing and Local Government (KPKT) Deputy Minister Datuk Seri Ismail Abdul Muttalib said a total of 29,698 units of completed houses, out of the 127,604 units launched with a value of more than RM18 million, were reported to be unsold in the first quarter of this year.
Ismail said records at the National Property Information Centre (NAPIC) showed that this was lower compared to the 30,664 unsold units in the fourth quarter of last year.
"Among the reasons for this are the inability to purchase according to the market price and the lack of an integrated system to ensure there is a match in terms of supply and demand according to location," he said during a question and answer session in the Dewan Negara, reported by Bernama yesterday.
Ismail was replying to a question from Senator Dr Ahmad Azam Hamzah, who had asked on the ministry's guarantee that all the houses built would be sold.
Among KPKT's efforts to improve the housing sector was to cap the ceiling price for affordable housing at RM300,000 under the National Affordable Housing Policy.
KPKT is also conducting a Housing Data Analytics Study to get a real picture concerning housing management in the country.
The study will be used as input for the development of a property data collection centre platform, which includes demand and supply, to help in decision-making at the federal and state government levels as well as to assist in the provision of more comprehensive national housing policies and planning, Ismail said.
The government is developing the Housing Integrated Management System (HIMS), which would act as a one-stop centre for matters under the Housing Development (Control and Licensing) Act 1966 and the updating of private housing development information.
The system is expected to be ready by April 2021.