The number of unsold residential properties remain on the uptrend even as the government’s Home Ownership Campaign (HOC) proved to be a success, registering RM19 billion in sales.
National Property Information Centre (NAPIC) data showed that unsold homes climbed from 30,115 units in Q3 2018 to 31,092 units in Q3 2019, albeit their value fell from RM19.54 billion to RM18.77 billion, respectively.
Faring even worse, the commercial property segment also saw the number of overhang units jump from 15,600 units valued at RM11.64 billion in Q3 2018 to 24,820 units worth RM19.81 billion in Q3 2019.
The serviced apartment segment, which saw unsold units soar 79.32% to 17,459 units, accounted for the bulk of unsold commercial units.
This comes as the demand and supply parameters for serviced apartment units are yet to achieve a point of equilibrium, said Jones Lang Wootton ED Prem Kumar.
“The serviced apartments segment would require more time for market-driven adjustments to take place,” he told The Malaysian Reserve.
“On the supply side, developers are conscious of the current market scenario and have been exercising restraint in order not to further flood the market. This is extremely crucial to expedite the overall target to achieve market equilibrium.”
Johor registered the biggest number of unsold homes at 5,470 units. It also contributed the highest number of unsold serviced apartments at 12,371 units during the period under review.
Other states with significant number of unsold homes are Perak and Selangor, with 5,126 units and 4,872 units, respectively.
Prem noted that it is hard to tell when the property market will “achieve market equilibrium” given that new supplies continue to flood the market despite tighter credit conditions on property acquisitions.
And while HOC helped in lowering the number of unsold units, he believed that other catalysts are needed to spur the market.
“The market phenomenon in Malaysia is unique whereby there appears to be a greater preference for newly launched developments as opposed to completed developments, albeit the completed are relatively brand new with greater product visibility,” he explained.
“The market mindset should be changed that completed units have better value for money with significantly reduced uncertainties in terms of product quality, branding and profile, among others.”