KELANA JAYA: Property developers are mainly neutral about the real estate market outlook for the next 12 months, particularly for the second half of 2023 (2H 2023), according to Datuk NK Tong, president of REHDA Malaysia.
According to him, poll respondents have a moderate opinion of the business, economic, and property industry outlook for the coming months, with greater optimism for the first half of 2024 (1H 2024).
"The increase in the number of launches and sales is a positive sign towards a property market that is slowly returning to normalcy," he said in his presentation on the REHDA Property Industry Survey for 1H 2023 and Market Outlook for 2H 2023 and 1H 2024 here today.
"However, true recovery is still out of reach as developers are still struggling with challenges that have yet to be properly addressed, such as material price hikes, cross-subsidisation, and high compliance and utility costs," he added.
According to the survey, nearly 3/4 of the respondents reported an average 15 per cent increase in their overall cost of doing business in 1H 2023, as opposed to 13 per cent in the previous half.
And 84 per cent of respondents also reported being impacted by the current economic scenario and have opted to take cost-cutting measures in terms of operations (freezing recruitment, offering fewer benefits and perks, as well as reducing salaries) and production/delivery (rescheduling the launch of planned projects, reducing the scale of launches, and delaying projects due to poor demand).
With regards to future launches and outlook for 2H 2023 and 1H 2024, about half of respondents (or 53 per cent) planned to launch their projects in the second half of 2023, with 3/4 of them anticipating their sales performance to be 50 per cent or below.
Most of these planned launches are priced between RM150,001 and RM300,000, particularly in Kedah, Perlis, Melaka, Pahang, Penang, and Perak.
The survey saw the participation of 148 member developers, in which both new launches and sales performances recorded a hike compared to 2H 2022 results.
Meanwhile, the majority of new launches in the first half of 2023, or 62 per cent, were priced at RM700,000 and below.
About 14,392 residential units were launched between January and June 2023, representing a 50 per cent increase compared to the previous period under review (9,426 units; 28 per cent).
Most of the units were apartments or condominiums (7,183 units), followed distantly by two- to three-storey terraces and serviced residences (3,729 units and 1,223 units, respectively).
Residential sales performance increased in 1H 2023, totaling 11,273 units (1H 2022: 5,087 units), out of which 35 per cent were new launches.
Apartments and condominiums performed the best sales-wise at 3,749 units, with serviced residences at a close second (3,688 units), followed by two- to three storey terraces (2,040 units).