IJM Land has around RM1 billion worth of unsold properties across Malaysia, but this includes units set aside for bumiputra, said its Managing Director Edward Chong in a report by The Star.
In some developments, home builders are required to allocate up to 40 percent of the total number of units for this group of buyers. While these properties are yet to be taken up, these don’t necessarily fall in the “overhang” category, he explained.
The National Property Information Centre (NAPIC) defines overhang as completed units fit for occupation, but are still unsold despite being available on the market for at least nine months.
While he did not disclose how many bumi units and their combined value were included in IJM’s RM1 billion unsold units, Chong said it is difficult to determine the exact amount and value of such properties in the 34,532 overhang units collectively costing RM22.26 billion across the country as of 31 March, as reported by NAPIC. This is because states in Malaysia have different release mechanism to sell bumi units in the open market.
“I am not saying there is no overhang in the country, but these figures may be inflated,” he reckoned. Chong added that 95 percent of IJM’s unsold properties comprise landed and high-rise homes, with the remaining five percent consisting of commercial units.
Despite the high overhang, IJM plans to roll-out around RM1.5 billion worth of projects in the fiscal year ending 31 March 2019. For instance, its 760ha Bandar Rimbayu project in Kota Kemuning, Shah Alam targets to launch SWANS double-storey link houses priced from RM850,000 by Q4 2018.
“The Bandar Rimbayu project could last for 12 more years to go with a GDV of close to RM15 billion,” Chong noted, adding that IJM currently has a landbank of more than 1,618ha in Malaysia with a GDV of about RM30 billion.
Meanwhile, Selangor’s Chairman for the state committee on housing Haniza Mohamed Talha blamed “excessive” pricing for the high number of unsold units in Malaysia, particularly in the state.
On the other hand, she noted that there is strong demand for low-cost dwellings. In fact, the state received 156,138 applications for the Rumah Selangorku affordable housing scheme, of which only 44,454 applicants were qualified.
This article was edited by the editorial team of PropertyGuru. To contact them about this or other stories email editorialteam@propertyguru.com.my
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