Houses above RM250,000 constitute 80 pct of new launches in Q1

The high-end property market remains in the glut as 80 per cent of new launches in the first quarter of this year were units priced above RM250,000 which is considered affordable to only 58 per cent of Malaysian households.

Second Finance Minister, Datuk Seri Johari Abdul Ghani said the oversupply of higher-end properties resulted in 83 per cent of the unsold units currently are in the RM250,000 and above price segment.

"As compared to the first quarter of 2012, there are 54,000 unsold houses, with high-end properties making up around 19,000. But currently, out of 130,000 unsold units, 108,000 were high-end properties," he told reporters on the sidelines of the 20th National Housing and Property Summit 2017 here today.

He said despite a high demand for affordable houses, only 24 per cent of new offerings fell into that category as compared to demand of 42 per cent.

"Prevailing median house prices are beyond the reach of most Malaysians primarily attributable to a gross mismatch between housing supply and demand amid diverging expectations between households and developers," he added.

On the financing side, Johari said property financing continued to be dominated by property prices below RM250,000, making up 56 per cent of the total loans outstanding, while loans for houses priced between RM250,000 and RM500,000 accounted for another 25 per cent.

"About 72 per cent of housing loan borrowers in 2016 were first-time buyers," he said.

For the first quarter of this year, the overall housing loan approval rate remained high at 74.2 per cent.

"Banks had approved a total of RM22.3 billion of house financing to 93,137 borrowers," he added.

Meanwhile, on Rental Law, Johari said he would discussed with the Domestic Trade, Co-operatives and Consumerism Ministry and Urban Wellbeing, Housing and Local Government Ministry to introduce proper regulations for rental properties.

He said Malaysia could take the example from the United Kingdom (UK) which had regulations on rental properties which protected the tenants and landlords, as well as database of tenants and landlords.

"In the UK, there are laws protecting the tenants and landlords so the landlords can't abuse their position as landlords and tenants can't misused or damage the property, and they have a database of the tenants and landlords," he said.

He added that the availability of such database would also make it cheaper for both parties if disputes arose.

-- BERNAMA