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Property Developers Neutral On Market Outlook: Rehda Property Industry Survey

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Real Estate and Housing Developers' Association Malaysia’s (Rehda) Property Industry Survey found decreases in both launched units and sales performance for the first half of 2022, with developers staying neutral for expectations of the first half of 2023.

 

Rehda president Datuk NK Tong provided a disclaimer stating that the survey had been taken before the parliament dissolved.

There were 150 survey respondents from Rehda members, reporting 7,843 units launched in H2 2022, which was a 26% decline compared to H2 2021. 

 

Most units launched were residential, a majority of which comprised two-to three-storey terrace houses at 3,884 units, followed by serviced apartments and single-storey terrace houses.

 

Sales performance dropped by 5% to 45%, with Seremban, Negeri Sembilan and Jasin, Melaka being the most transacted area, with commercial and single-storey terrace houses trailing behind at 367 units and 331 units respectively. 

 

Amongst purchasers, first-timers made up almost half of property buyers in H2 2022 at 42%, and 46% of purchasers bought units for self-dwelling purposes.

 

In H2 2022, 55% of respondents reported having unsold residential units, in which most unsold units were within the RM500,001 – RM600,000 price range.

 

Respondents with unsold residential units noted that the affected units had remained unsold for more than 36 months, with a range of reasons including end-financing loan rejection, unreleased Bumiputera lots and high pricing and low demand or interest.

 

The survey also revealed an increase in the overall costs of doing business, with 91% of respondents said that they were affected by the current economic scenario, and had taken several cost-cutting measures both operation- and production-wise, including freezing recruitments, reducing salary, rescheduling launch of planned projects and reducing the scale of launches. 

 

The three main cost components affecting cash flow, according to the respondents, were material and labour cost, compliance cost and land cost. 

 

Market outlook

Half of the respondents planned to launch projects in H2 2022, consisting mainly residential units, with 66% anticipating a sales performance of 50% and below.

 

Developments in Melaka targetted a price range of RM100,001 – RM250,000, whereas Johor will launch RM700,001 – RM1mil units, while Kelantan has no planned launches. 

 

“This voluntary survey is carried out twice a year and while it is not comprehensive of all units launched, it continues to provide insights into member developers’ sentiments on the performance of the property market, as well as our expectations for the coming year. The outlook is less optimistic than before, but Rehda members continue to be committed to our nation-building role for the benefit of all Malaysians,” Rehda president Datuk NK Tong said.

 

Rehda vice president Datuk Edward Chong, deputy president Datuk Ho Hon Sang, vice president Datuk Chan Kin Meng and secretary general Teo Chui Ping were also at the press conference.