Penang Property Outlook 2017 by Ken Lim, penangpropertytalk.com

I read a very good article published in
penangpropertytalk.com
 by my friend Ken Lim. I think for those interested to know more about what Penang property market has to offer, this is a good site to go to. The article is Penang Property Outlook 2017. It gives an overview of what happened in 2016 followed by an overview of the possibilities for 2017. Happy reading yeah.

It has been a quiet year for the Penang housing market in 2016. The cooling measures and tighter credit environment have continued to negatively influence the local market. While many are hoping to see a recovery soon, recent disappointing economic performance has further dampened market sentiment. Buyers are adopting a “wait-and-see” strategy as they remain uncertain of the economy’s future.

The delay in the issuance of advertising permit and developers license (APDL) has also contributed significantly to the decline of property transactions in Penang. Without the APDL, developers are not able to sell and promote their projects, nor can they finalize sales and purchase agreements.

The chart above makes it clear that home sales have slowed down over the past three years and are expected to continue that trajectory in 2017. To get a sense of just how much sales have dropped in the past two years, consider the latest data from NAPIC, which indicates that the total housing transactions in first half of 2016 have dropped 13.5% and 25.8% compared to the same period in 2015 and 2014 respectively.

Prices rise despite slower market

Unfortunately, slowing transactions don’t mean that home ownership will become more affordable. PenangPropertyTalk.com experienced record website traffic in 2016 with over 1.79 million visits, beating 2015’s record of 1.61 million by approximately 10%.

There is actually a straightforward explanation for this: People’s obsession with home ownership is not fading, but they are adjusting their risk appetite and waiting for the right deal.

The figures below show the average transacted value for the three most common residential property types (condo, two-to-three story terrace and semi-detached) in Penang. Undeniably, house prices have generally seen an upward trend, with the exception of condominium and terrace houses located in south-east district of Penang Island.

The landed house prices on the Mainland have shown steady growth over the past two years as upgraders are looking for bigger space for their growing family. The average transacted value for a semi-detached house in Penang Island also registered double-digit quarter-on-quarter growth in Q3 2016.

Deep-pocketed investors look at investing in landed houses as solid investments not only because it comes with a solid land, but also because it is less speculative as many make these their homes. Certainly, the scarcity of land will continue to drive up property prices, particularly for landed houses.

Opportunities during slow markets

The supply of affordable housing has influenced a fundamental shift in the Penang high-rise market, moving it out of rapid recovery and into a new normal where slow growth will stay for the long run. Thus, first home buyers can look forward to a more stable market with ample time to make the right decision. If none of the existing projects appeal to you, keep a lookout on the upcoming affordable houses located in Bayan Baru, Gelugor and Jelutong this year.

Concerns about further depreciation have also kept many people from buying houses during slow markets. However, by recognizing the opportunities that slow housing markets present, prospective buyers can break away from the pack and take advantage of good deals. If you scout around, you will find almost all the developers are now sweetening their deals with freebies, discounts, rebates and other innovative financial assistance schemes.

Penang Mainland – Full of
possibilities

As land becomes more expensive on the island, developers are moving to build on the mainland where the abundance of land offers greater opportunities. Exclusivity and lifestyle will be the key development theme — a differentiation strategy which influences the expectation of a new living standard.

EcoWorld’s maiden project at Simpang Ampat,
Eco Meadows
, is a perfect example of how differentiation plays a vital role in influencing a buyer’s perception of value, setting it apart from the neighboring projects. Prices start from RM700k when it was first launched in late 2015, almost double the price of the surrounding houses and on par with the houses in a remote area of Penang Island. The project is nearly sold out now.

Infrastructure plan is too early to assess

The
Penang Transport Master Plan
 (PTMP), the biggest infrastructural undertaking in Penang’s history, was one of the hottest topics discussed in 2016. It will be the greatest catalyst for the property market in the northern region, and it will help to create a more equitable housing situation for all by making remote township more accessible. Unfortunately, these plans are still too nebulous to have any material effect on the housing market in 2017.

Highlights in 2017

For first home buyers, keep a lookout on a few more affordable options coming up at Bayan Baru, Gelugor, Jelutong and Batu Ferringhi, including two projects by PR1MA.  Choose wisely within your means. A branded location does not necessary mean the right location for you.

Properties in a prime location with a price tag of around RM700k-RM800k are expected to enjoy good take up rates. If you have that budget, stay tuned for the upcoming condominium by IJM —
3 Residence
 and
Waterside Residence
, and the mixed development by Temasek —
BPO Prime
 at Bayan Baru. Looking for high-end options? Check out the upcoming
Marriott Residences
 at Gurney Drive,
Penang Straits Residence
 at Seri Tanjung Pinang or wait for the new launch of landed properties by E&O property.

Gated and guarded communities on the Penang Mainland remain the ideal lifestyle choice at relatively affordable prices. Check out some of the existing projects before they get out of reach. The upcoming gated and guarded development by EcoWorld (
Eco Horizon
) and Aspen (
Viluxe
) at Batu Kawan will set a new price benchmark for properties in Mainland.

Still wondering would the property market recover in 2017 or 2018? Let’s put aside the word “recovery” and recognize the current market as a new normal. New growth will start from here.

– Ken Lim

(Founder, PenangPropertyTalk.com)

Next suggested article:
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Penang Property Outlook 2018 – What’s brewing?

In Penang, there’s one prominent local property site which is visited by most of my friends. In fact, it was not the most popular when I first got to know some property sites based in Penang. Today,
penangpropertytalk.com

has around 100,000 visits per month. Do visit them often. On a daily basis, my good friend Ken Lim would scour for property-worth news to share with everyone. I think this is much better than reading many copies of newspapers and not knowing which is considered a significant property news. He has just published a “Penang Property Outlook 2018” article which I believe is a good read for everyone. Please do refer below for Ken’s assessment for Penang Property market.

— start —

As we walked down to the memory lane of 2017, it was obviously one of the slowest year in the decade for properties. There were only a handful of new projects launched throughout the year and some were delayed. Developers were very careful with what they were launching and many were sweetening their deals with freebies, discounts and rebates. Some bigger developers were even offering innovative financial assistance schemes.

The slowdown in 2017 was evidenced in the data published by NAPIC; with approximately 15% drop in property transaction from 2016. However, the data also shown that the property prices had rises despite slow market. The average residential property transacted prices in the island and mainland for first three quarters of 2017 had increased about 12% and 10% respectively compared to the same period in 2016.

We have waved goodbye to 2017, and welcomed 2018 with open arms. Many are anxiously hoping that the market slowdown is over and 2018 will promise a new bounce-back market. Being optimistic is encouraged however the year ahead is only pointing to a continuous market slowdown trend that’s unlikely to recover in short term. The housing affordability will continue to remain as a nagging issue among the average Penangites.

Housing affordability at the island city continues to be challenging

Under Budget 2018, the government has increased allocation to address rising cost of living and affordable housing issues among the lower to middle income group. This action will certainly be the only short-term measures with limited effect. The recent freeze on four components of the property market that include condominiums and serviced apartments priced RM1 million and above is a disruption to the high-end products, yet it does not get to the root to address the housing affordability issue.

While affordable homes are mushrooming across Penang targeting on affordable buyers, the current scheme appears to be inadequate to address varied demands and budget. Penang as a fast growing state is hunger for a more solid yet dynamic affordable housing scheme to assist the buyers in various aspects. Until we are fitted with a more extensive scheme, the year ahead will continue to be challenging for affordable housing buyers.

For those who have made a new year’s resolution to buy a new affordable home this year, do expect several more affordable housing to be launched this year at a few new locations such as Gelugor, Batu Ferringhi, Jelutong and Bukit Mertajam.
Two new PR1MA projects
 are likely to be launched in the island this year. Most of these upcoming affordable projects will be priced within the range of RM300k.

Oversupply in South West district

The abundance supply of affordable and mid-range housing, priced within the range of RM500k in the South West district will continue to affect the house prices in those areas, which are unlikely to improve anytime soon. This is particularly true for the condominium in areas such as
Bayan Lepas
,
Sungai Ara
, and
Teluk Kumbar
.

As the year 2018 is wrapped with a market slowdown trend along with oversupply in the South West district, determined buyers and investors can still consider projects with unique offering situated at strategic location as these projects will continue to outperform. Other than the prime locations at northern side of Penang Island, projects at
Sungai Nibong
 and
Queensbay
 area also recorded a good take up rate and are expected to continue outshining in the southern part of Penang Island.

Teluk Kumbar, is an option for those who may have a more confined budget. You may be able to find a bigger house with the same budget. The completion of the flyover connecting Jalan Bayan Lepas to Jalan Teluk Kumbar will be a catalyst for more intensive development in that area, and ultimately opening up yet more choices.

Township development in mainland

For mainland, the prevailing trends in focusing on township development will continue. With comfort and lifestyle is being emphasized, developers with huge land banks has been constructing their plan to offer a better living solution – a comfortable home with good accessibility to workplaces and daily needs, and within a safe and fun community for your family.

With many exciting developments in progress at Batu Kawan, all eyes will be on this satellite township as several projects will be completing in stages over the next few years. The construction of IKEA is expected to complete by end of this year and is slated to open in January 2019.
The Ship Campus (ALC College)
 and
KDU University College
 are on-track to complete by 2018 and 2019 respectively.

In order not to be missed out, several MNCs and SMEs are also expanding their manufacturing operation in Batu Kawan, namely Flextronics, HP, Sandisk, Sunningdale Tech, Boston Scientific, Vitrox and a few others.

Batu Kawan
 will continue make a significant attraction and focus for Penang development and it will keep the ball rolling to the possibility of being the most talked about area in the northern region of Malaysia. The blooming of Batu Kawan township could only offer endless possibilities. With developers striving into providing a better living solution, not just a home to buyers, the prices of property in Batu Kawan is anticipated to inflate within the next five years.

Food for Thought

Property market will always go up and down, the economy will always fluctuate. However, there will always be right investments to make. Over the long term, placing money into properties in Penang is a sound strategy because land is the most precious commodity in the island state.

As new high-rise building is now built taller, denser and further, the best time to buy a property is always yesterday. And the day closest to yesterday is today. To make sure you make the smart choices, you must understand property is a long term investment and be crystal clear with your financial needs and goals.

– Ken Lim

(Founder, PenangPropertyTalk.com)

— end —

Happy reading and following. Remember, information is always handy when it comes to making a decision which may just change our lives forever; property investment. Next suggested article:
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The new Penang by Ken Lim of penangpropertytalk.com

My ex-manager has been extremely active in our group Whatsapp group these two weeks. He has continued to share positive news about a new Malaysia. He was one of the most negative about the state of Malaysia before the GE14. He is now the most positive too. In fact his most recent sharing was a mural of our 7th Prime Minister Tun Dr. Mahathir in Cheras. (featured image above) He told all of us in the group that the mural is nearby his home and that he welcomes all of us to his home too if we happen to be dropping by to take a photo with the mural. I think he is not the only one. These days, on a daily basis, everyone continues to share good things about the government. Well, let’s always ensure we provide a good check and balance to our government because they were elected by us to work for a better Malaysia. The next sharing is from
Ken Lim, the founder of Penang’s most popular property site.
 As he is someone with lots of information about the Penang property market, his views are relevant to people who are looking to invest into Penang. Happy reading yeah.

— start —

On the night of 9 May 2018, a new Malaysia was born. Automatically, one very critical thought transpired in my mind. The property market in Penang will most likely have its reformation and almost guaranteed to have a facelift.

For almost a decade, Penang has been aiming high, with many creative and innovative plans focusing to upgrade various sectors and its infrastructure to the next level. However, many plans hit roadblocks and some developments struggled to move on. Many ideas were either on hold or took longer time to proceed.

Instead of a dark, vague and a future that’s full of uncertainties, the future of Penang has suddenly transformed, turned so bright that we can now see “a light at the end of the tunnel”. Penang had always been independent working on developments with minimum support from federal government. Yet, Penang is able to prosper and is named as one of the richest states in Malaysia. What more, now with the new Malaysia, equitable support is expected from federal government!

Penang Transport Master Plan, which comprises
LRT
,
undersea tunnel
 and
highways
were some of the state development projects which Penangites have doubts with. We often wonder if these plans will ever materialize as there were just one roadblock arising after another. May 9th marked the day where Penang will have a new chapter in urbanization and it will only promise a better future in the Penang property market.

Getting approval for advertising permits and developer licenses (APDL) from federal government has always been one area that slows down the property development in Penang. Some affordable housing projects in Penang were affected. Moving forward, the APDL approval process for projects in Penang is expected to improve and the biggest benefit will route to the developers and home buyers as the transaction can be sealed within reasonable timeframe.

Affordable housing
 to remain as one of the key focus in Penang. Now with assistance from Federal Government, coupled with several improvement plan in the pipeline that involves construction process, financing, simplifying administrative processes, incentives, and introducing rent-to-own schemes. The aim is to keep homes within the reach of the majority of first time home buyers, making home ownership easier and more affordable for Penangites.

With new Malaysia, property in Penang is guaranteed for a better and brighter future. Penang will now open a new chapter! New Penang is coming soon! Thank you to the new Malaysia!

– Ken Lim

(Founder, PenangPropertyTalk.com)

This article was originally published here.
 Hope everyone has absorbed his positive thoughts too yeah. I think it is clear by now, a positive sentiment is the best power a country could have. Sometimes, it is not just about being rated under the ‘investment’ grade because if the sentiment is negative, the domestic consumption remains low. Oh yeah, there’s even a tax holiday since GST will be zero-rated by 1st of June 2018 while the SST will only be in place 2-3 months later. Buy, Buy and Buy? 🙂

next suggested article:
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Penang property overhang? Price and Financing issues

I know it’s not an awesome time for Penang property market. I know because the price that I wanted for a condo of mine in Penang is still nowhere near and my real estate negotiator friend kept teasing me. According to
Article in NST for reference here: Residential overhang in Penang a major issue.
  According to the Valuation and Property Services Department in its Malaysian Property Market Report 2017, the residential overhang in Penang increased more than twofold to 3,916 units worth RM3.82 billion last year from 1,896 units worth RM1.47 billion in 2016. In brief, it’s worsening. Most of the residential overhangs in the state were condominiums and apartments priced at above RM500,000 per unit. (Now I understand why. Perhaps a little waiting is now needed while waiting for the next catalyst)  Briefly, overhang is defined as built properties that remain unsold at least nine months after completion.

The two major reasons for the overhang in Penang is likely due to unaffordable property prices and financing issues. (When people just could not afford them, of course they will remain unsold. In terms of financing issues however, I think it’s both ways; banks and the borrower themselves. We can say the banks are more stringent but we have to also understand that the borrowers today are no longer saving as much as their peers from yesterday. This is why someone with RM10,000 salary may not be able to afford a RM500,000 home while someone who saved enough and earns just RM8,000 may still get their loans approved when they want to buy a RM500,000 home. The typical mortgage for a RM500,000 property should be between RM2,250 – RM2,500. Even with a RM8,000 pay, this mortgage is only 31 percent of their income. Approval is quite certain unless of course there’s the credit card debts, high car loan payments etc)

In fact the article suggested that the developers may not need to worry so much going forward as the overhang situation in Penang could get better in the second half of this year or from next year onwards. The reason is because the Penang government will be reviewing all the charges currently imposed on developers to make property prices more affordable for consumers. Among the charges to be reviewed are those for development, infrastructure and amenities. State Housing, Local Government, Town and Country Planning Committee chairman Jagdeep Singh Deo said, the charges inflated the prices of properties which would be borne by consumers, but upon review, is expected to fall. Meanwhile Rehda Penang chairman Datuk Toh Chin Leong said developers are still lumbered with a high number of unsold stocks. He said, “Rehda was thankful to the state government for assisting in promoting Mapex 2018 by providing special incentives, such as the waiver of the levy on foreign purchasers, and the two per cent levy on sub-sales within three years.”
Please refer here for the full article.
 Happy following and hoping for more good news.

written on 3 Aug 2018

Next suggested article:
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Penang Property Potential

This question requires a very long answer, beyond my usual 300 words article. 🙂 However, let us focus on three aspects for now. Space, people and connectivity. There are a few key property markets in Malaysia. This includes Klang Valley, Iskandar, KK, Kuching and without any doubt, Penang. If we look in terms of space availability, we can see a clear reason for Penang. In terms of actual land size, Penang is just 295 sq km. Singapore is 710 sq km. Yes, there is also Penang mainland but if you realistically ask any Penangite, if prices are the same, would they stay in island or mainland, the answer is almost always ‘island’.

My question is, if we assume Penang is 10-15 years behind Singapore, why the property prices cannot rise to Singapore level by then? Penang’s airport is 3rd busiest but it is growing by double digit every year. Medical tourism is increasing as well as overall tourist arrivals. Manufacturing is still key and advanced development centres are being built. The latest science park built in mainland Penang is nearly full!  Instead of typical technicians, some factories have 80% engineers, most of whom are paid very well.

Penang’s current population is 1.6 million, expected to increase to 2 million in 7 years time. In terms of increase, it’s 400,000 of which if we assume 4 person to 1 home, another 100,000 new properties are needed. In terms of new properties, in a very good year, Penang may have a total of 12,000 units of new homes being built? I repeat, in a very good year. And even at this rate, it is not possible to satisfy the needs of the new population. What about the current population? What about people who wants to move out from their current home?

The potential is there, definitely. According to Michael Geh, a Director of Raine & Horne, in the secondary market, ‘the prices are between RM500 and RM800 psf for NE, and RM450 to RM750 psf for SW’. If we were to compare this to Singapore, you cannot even buy the cheapest flat of a good size. Today there are at least 15 flights to and fro Penang and Singapore, making these two cities just 1 hour from each other and connected nearly every hour!

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Penang property price cheaper today?

‘The price of property is cheaper today than six months later’. This was the answer from REHDA Penang President, Dato Jerry Chan when he was asked if the prices are going down since the total market transactions are going down. He went on to explain that low interest rate is the factor why property prices would continue to go up and also the actual fact that when compared to even regionally, Malaysia remained cheap. We can refer to the chart which shows the BLR in Malaysia and we can see that what he said was actually true. Current BLR is indeed on the lower side even if no longer the lowest. He also explained that Penang is the only place in Malaysia where it is impossible to get a room during festive season.

Dato Jerry Chan then mentioned something which I have written a few times in my articles. Current market is cautious but investor sentiment is definitely not negative but more on cautious note. Reason for this is because everyone is still unsure of what to do next. So many cooling measures, how would the market react? Thus, everyone is thinking twice before they buy. In fact this is the best time to buy because the buyers have the most bargaining power. This situation is not expected to last long.

Besides that he reiterated his earlier points, that the construction costs continue to go up, especially due to labour shortage. Many Indonesian labourers are now home because of Jakarta’s own property boom. Mr. Toh then added that from what he can see, majority of all the more affordable units which will be launched, the prices may be more or less today’s level but sizes would be smaller. Thus, he advised the buyers to buy the developments which are/were launched before Chinese New Year as they still carry the old price but sizes are bigger.

To be objective, not all the properties launched earlier are affordable, however, in terms of sizes, I think Mr. Toh’s statements are very true. The only way for units to be more affordable would be through the reduction of size. I am not so sure if there would be more SOHO units but I think sub 1,000sf units may dominate the market launchings from now onwards. Even at RM500psf, if developer were to launch 1,500sf today, buyers may not be willing to take up a loan of nearly RM800,000. Spending a little time to visit the actual property fair may reveal more on whose words are really true.

MAPEX Penang will be held on 2-4 February at G Hotel. Time is 10am – 9pm.

written on 24 Jan 2014

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Alternatively, do read the
top 10 most read article

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Penang property prices still going up – REHDA Penang

I read an article in TMI quoting REHDA (Penang), Dato Jerry Chan as saying that prices of land in Penang is still rising and the latest one being RM1,200 psf which was the state government’s land swap deal with Consortium Zenith BUCG which is building the mega RM6.3 billion undersea tunnel and three highways. RM1,200 psf is a record high in Penang. This would meant that the new land deals are not going to go lower but would continue to edge up.

His deputy, Mr. Toh of IJM said that there are a few reasons why property prices in Penang will go up despite the new levy. This is because landowners will continue to ask for higher prices while the costs of construction has also gone up 40-50% for the past few years following inflation. besides that, within past five years, developers are continuing to pay ever higher compliance costs such as RM120,000 in lieu instead of building low cost units, and even car park is now RM35,000 instead of RM15,00 previously.

Personally, I hope that the prices are much more moderate. Secondly, a huge number of affordable housing continue to be built. There are some signs that the prices are slowing down. Especially if we look at the recent launches, in certain parts of Penang, it’s coming back down to RM450 psf. For example, Relau. There are also developer’s new projects which are no longer selling as fast as they hoped. I seriously feel that the market needs to consolidate for a while. Demand is there but perhaps the prices has gone way too much from it’s supposed fundamentals. What’s the price psf I hope for?  That’s hard to answer because Penangites have their favourite spots. As for migrants like me, I like newer places which a lot of Penangites shun. Haha.

Written on 10th Dec 2013.

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Penang Property Prices, still ‘too high’ (updated)

A friend asked me again, do you think Penang property prices would drop? Penang properties are still very expensive. Too expensive in fact. I asked her to define expensive. She said, RM1,000,000. I said, you are joking right, there are lots of properties way below that. She then showed me two projects on her smartphone. Seri Tanjung Pinang and The Light Collections. She said, these are two of the properties which a lot of super rich people are buying. I said, yes, it is true. Super rich people love these properties. However, to the super rich, are these considered ‘too high’?

Actually, Penang property prices would always be high, I am talking about the island. First of all, everyone wanted to stay inside the island and everyone wanted to stay in a proper area. Proper area means areas where people do not associate as low end or areas considered secluded. Thus, the price difference has been pretty wide, up to 50% difference despite the fact that both the properties are within the same island which in terms of land size is smaller than Singapore!

I told my friend, there are truths that Penang property prices are expensive. There are also truths that some luxury properties has risen way above its appropriate levels. However, a check with any online sites on the secondary market continue to show that choices are still aplenty and that secondary property prices still have room to grow before catching up with the prices of new properties or properties which are under construction. In other words, the prices of these secondary properties has already ‘dropped’ when compared to the new ones. How much more lower do you think it will drop? Answer is for you to think about.

written on 2nd March 2014

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Penang property prices has started to drop in Q3 2015?

First of all, I must say thank you to my good friend, Michael Geh, Senior Partner of Raine & Horne International Zaki + Partners Sdn Bhd for providing these good charts of the Penang property market. Let’s start now.

When I saw the average numbers for Penang, I wanted to tell my wife that the property prices in Penang have dropped for Q3 2015. Perhaps it’s time that we think about Penang again seriously. Then, I checked online for a few properties. The prices have remained almost the same and has actually gone up a little. Last year, I sold my condone Penang for RM640,000. Name of the condo? Regency Heights. A check on some of the listings has showed that prices are not going down. It has stayed almost same. I then checked Summer Place. I can safely confirmed the prices have stayed almost the same or slightly higher.

Why then did the average transacted price show a downtrend? A deeper check revealed that there are proportionately more transactions for the lower priced ones. This is especially true for the RM201k to RM500k. While there are no further breakdown but we can safely say that due to affordability issue as well as the fact that mainland is slowly but surely becoming more acceptable, the average prices has thus dropped. Nope, the closure of some manufacturing plants have yet to impact the property market and a check in JobStreet.com would reveal that the job numbers for manufacturing remain extremely healthy and shortage for certain skills are still continuing.

Looking at the type of transactions would reveal a shocking number. I seriously do not think demand is going down BUT the wait-and-see attitude is now becoming a norm. Rental in Penang as usual is still low and perhaps this may also be one reason why total transactions are down. Instead of buying more are choosing to rent first while waiting for the market to stabilise? Perhaps another strong reason is also because the property prices in the popular areas are still high. Many are waiting and hoping that the prices for these more popular areas would come down. Well, this IS the reason why the prices remain high; YOU. Read here:
Property prices too high? YOU might be the main reason

There is no way that property prices can continue to rise under current market situation. Not in Klang Valley and definitely not in Penang. Anything above RM700,000 will be considered unaffordable or even unacceptable unless it is landed. The issue with landed? It has become so expensive that even if the price is there, selling it fast would be another thing altogether. Happy reading about Penang property market.

written on 12 Jan 2016

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Penang property market Q1 2015: Qty down, RM up.

All charts were provided by Michael Geh , Senior Partner of Raine & Horne and also the Vice-President of FIABCI Malaysian Chapter with numbers from NAPIC.

In Q4 2014, Penang’s property market showed resilience when it’s total transactions increased when compared to Q3 of 2014. Total transactions in units reached 5,193 from 4,194. An increase of almost 1,000 units. In percentage it was around 23 percent up. Some were hopeful that this may be the start of a recovery where Penang property market is concerned. Furthermore mainland was said to be rising with the second bridge. Well, nothing of such happened. By end of Q1 2015, the total transactions has dropped 26 percent when compared to Q4 2015. Thus, from 5,193 units just one quarter earlier, this has dropped by 1,359 units to 3,834 units. This is the LOWEST number since 2011. This drop may have been attributed to the negative sentiments and thus market adopted a wait-and-see attitude instead.

In terms of price range, the most number of units transacted was in the RM200,001 to RM500,000 category. However, the drop in the number of units transacted was the highest among all categories. It dropped 491 units. The lower price range ones dropped a lot too, probably because the buyers for these units have been the most affected whenever the sentiment turns negative. In terms of average transacted prices, it has edged up slightly. From RM397k, it is now RM404k. Looking at the number of transactions, this meant that despite a drop across all types of properties, the higher priced ones are more resilient. A general conclusion is that those who could still afford to buy are the wealthier ones and these are the ones who are willing to buy something more comfortable, thus contributing to this slight increase in average transacted prices.

If you have read some recent articles about Penang, there has been more news about mainland Penang, especially where Batu Kawan area is concerned. It is said that this is where the boom may be because of Vision City. Read here:
Vision City, the Verve and IKANO for mainland Penang

I still believe that the growth would remain within island for many more years because of all my Penangite friends. I have very few Penangite friends who speak highly about mainland. Most of the time, it’s still better to live where all the actions are. With Gurney Mall, Paragon Mall and even Queensway Mall, island certainly has much more attractions, not just with the malls but also other attractions as well. Come on, even UNESCO Heritage City is for Georgetown which is within the island itself. That huge catalyst project showing a huge sign has yet to appear as at 2015. Who knows, once market turns positive everyone may turn bullish about mainland Penang? Yes, I still have properties in Penang and would love to keep it for now. Happy reading and buying.

written on 7 July 2015

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Penang Property Submit 2015

There’s one upcoming event in Penang which is worth a visit. It’s the PIP Conference on 9th and 10th January 2015 to be held in SPICE (PISA). This year, the event is a collaborative effort between the organiser, PenEvents Sdn Bhd and the Penang state government. This is is both an expo as well as a conference. This was a initiative by the State Executive Councillor for Housing, Town and Country Planning, YB Jagdeep Singh Deo. The primary focus of the Summit is to provide the desired forum for the industry players, related trade associations and key public officials to network and broaden their knowledge on issues and trends relating to the industry. With changes evolving both locally and abroad and business environment changing dramatically, it is imperative that practitioners adapt to the changes and maintain their competitive edge.

PIP CONFERENCE

The PIP Conference to be held on 9
th
 and 10
th
 January at Spice (PISA), will see a wide range of issues and concerns being discussed.   The feedbacks from the deliberations will provide insightful information for the state government and related public agencies to formulate policies and mechanisms to administer the state property and related sectors.

PenEvents are happy and proud as the invited guests who will be sharing are all the movers and shakers of the industry. They will be sharing about the issues facing and affecting the property sectors today. Apart from officiating the opening of the Summit, Penang’s Chief Minister, Tuan Lim Guan Eng will also deliver a keynote address at the Conference and thereafter, join a team of Penang Property CEOs in a round-table discussion entitled ‘
Meeting Further Challenges in Penang Property Scene
’

There will be 3 Panel discussions which will be keenly followed by the conference participants as well as the public at large. The panel discussions pertain to :-

Affordable Housing – Meeting Growing Demands

Penang Property Outlook

Greening the Built Environment

The key topic of Affordable Housing will be personally moderated by YB Jagdeep Singh Deo and the panelists comprising the ‘Who is Who’ in Penang property sector.   Apart from Mr. Chia Boon Kuah (President of REDAS, Singapore) giving us a regional outlook of the property scene, the presentations by Senior State Executive Councillor, YB Chow Kon Yeow and that of Dato’ Lee Kah Choon (Director, Invest Penang) will be closely followed by those who are viewing Penang as the destination of choice for businesses and investments.

Penang International Property Expo or PIP 2015 is an annual showcase that attracts quality exhibitors and genuine players in the property scene.   The event is marked by focus marketing and sustains a steady flow of visitors through interesting and informative talks, forums, games and other interactive activities.   More importantly, the show provides the ideal exchange between smart exhibitors and discerning visitors, leading to opportunities for quality sales leads and closing of contracts.

WHY PIP 2015

With the current economic situation, the need to promote and market property in a very competitive environment is ever present

Penangites are known to have high savings and are still bargain hunting

Penangites are also prospective buyers of choice properties nationwide for investment and personal reasons

Explore winning strategies and opportunities in PIP 2015

Showcasing local, foreign and secondary residential properties, as well as commercial & industrial properties

EXPO PARTICIPANTS

:

Developers of Residential & Commercial properties in Penang, Malaysia & Overseas

Key public agencies involved in development, promotion and marketing of facilities and services in the Property and related sectors

Property Lifestyle products and service providers

Banks, Insurance and related Financial Institutions

Auctioneers

EVENT HIGHLIGHTS

Residential, Commercial & Industrial properties at choice location and attractive prices

Wide range of affordable housing

Property Lifestyle products and services

Talks & Forums on Property & Related Issues such as ‘Feng Shui’, Investment Tips,

Legal Advice etc.

Door gifts for first 100 visitors daily

Exciting Property Auction

Sales of ‘Secondary Properties’

Daily Lucky Draws with an I-Phone 6 to be won

Registration and updating of affordable housing by State Housing Department

Virtual Tours of selected projects at Expo sites

CONFIRMED PARTICIPANTS (as at 9
th
 December 2014)

Plenitude Bayu Sdn Bhd

Setia Promenade Sdn Bhd

Berjaya Land Development Sdn Bhd

E&O Property (Penang) Sdn Bhd.

Sunway Grand Sdn Bhd

Visentak Capital Sdn. Bhd (VST Group)

MTT Properties & Development Sdn Bhd

Penang Development Corporation

Hunza Properties Berhad

Jelutong Development Sdn Bhd (IJM Group)

Palmex Industries Sdn Bhd

Bersatu Stabil Sdn Bhd   (Oriental Max Group)

DNP Land Sdn Bhd

Ideal Property Group

Seni Bahagia Sdn Bhd

Tangkas Properties Sdn Bhd

Handle Property Group

Airmas Management Sdn Bhd

Malayan Banking Berhad

TM Telekom

Magnum Platinum Sdn Bhd

Magnum City Sdn Bhd

BSK Concept Zone

Inland Housing Book

MNP Auctioneers

A2A Capital

Raine & Horne

Virtual Tour Studio

Ho Chin Soon Research Sdn Bhd

The Edge

More updates coming soon. In the mean time, keep the dates free. As they say opportunities come to those who take the action. Early buyer catches the better properties. If you are a developer, the booths are limited and is based on a first come first serve basis.
Fill up this form
 and quickly contact PenEvents Sdn Bhd. The conference programme as follows:
Conference Programme.

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Penang Property Summit 2015. Not to be missed.

For Penangites, there is an event not to be missed this coming weekend. The Penang International Property Summit in conjunction with an international property exposition would be held in the Subterranean Penang International Convention and Exhibition Centre (SPICE) from Jan 9 – 11. With a theme of ‘Managing Future Trends and Challenges;, the summit would be from Jan 9-10 while the exhibition is from Jan 9 – 11. Total crowd expected would be over 30,000 and this will be one of the largest event for 2015. The summit is a platform for all the stakeholders of Penang’s property industry to speak their mind. From the state government’s side, its Housing and Town and Country Planning committee chairman, Jagdeep Singh Deo would be attending and he has personally been involved in the event right from the conception stage.

Most of the time, everyone goes to a property exhibition, take leaflets and leave. This time, it’s a chance for everyone to really understand what’s the future direction of Penang’s property market, the challenges and issues that all the different stakeholders are facing. Personally I think it’s worth a visit as most of the time, we may hear a bit here and a bit there. Why not listen from everyone all at once. If you are really interested to be a long term property investor, get to know more. For the event, over 48 booths have been taken up and a whopping 120 participants confirmed including developers, auctioneers and banks. It has been a long time that I have seen such a huge property exhibition because in Penang, there are always the small fairs with 5-10 developers nearly every few weekends.

According to the Vice president of the International Real Estate Federation (Fiabci) Michael Geh, current period is going to be an active few months because many house-buyers are rushing to buy a property before the implementation of the Good and Services Tax (GST). For developers, this would be the best time for them to offer their best and for buyers, a great avenue to compare all the different types of properties from different price range. See you there.

The Property Talk Schedule (View Here)

The Finalised Programme (View Here)

kopiandproperty.com is Penang Property Summit 2015’s Official Event Partner.

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Penang Property: Then, Now and Future.

I stayed in Penang for 15 years. I moved to the Klang Valley 6.5 years ago. I still have properties in Penang. If there are opportunities, of course I also hope to continue investing into Penang. Not currently lah, now it’s Movement Control Order (MCO), how to view and pay deposit yeah? I also go to Penang often too, so hopefully one of these days we can also have a cup of coffee. Don’t sit so close lah, 1 metre away ok. 🙂

It’s another Webinar via FB Live by Miichael Yeoh. He calls is MY LIVE (MY = Miichael Yeoh). He asked me if Penang Property market is a market which I am interested in. I answered, ‘Of course.” Thus he has invited me and our good friend WK Ng to share our thoughts on the Penang Property market. It’s aptly titled, “Penang Property: Then, Now and Future. ” Do join us yeah and please feel free to ask more questions too.

It’s on 13th April 2020 (Monday) at 9pm. All details, please refer below yeah.

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Penang property versus KL, which is more expensive?

My old friend asked this in Facebook today. He wanted to know which is a better to buy location. If you ask Penangites, they would tell you that Penang properties are too expensive. If you ask KL people, they will tell you look at Bangsar, Desa Parkcity or even nearby KLCC. How can Penang properties beat KL in terms of price psf? Let’s look at it from three perspective. Urbanisation, Jobs and international city.

In Malaysia, urbanisation continue to happen at a fast pace. KL + Greater KL is expected to grow from current 6 million to 10 million by 2020. Penang meanwhile would grow by another 400,000 population by 2020. If we compare these two we can see that the potential for higher capital appreciation is definitely KL. For those who say Penang is a small island state, please reminded that good location scarcity is not just in Penang but also in KL. Given a choice, people would love to stay in Bangsar rather than Sungai Buloh or Rawang. Thus, do you now know why prices in Bangsar is much higher than Rawang? This is what I term as good location scarcity. Is there such aterm? I don’t know.

In terms of jobs, it really depends. When my brother and my brother in law graduated with engineering degrees, I told them, Penang is the best. It proved to be true.  Both are doing exceptionally well and earning above the typical average salary of a salaried worker. However, if you are in IT, in Finance, in any other fields, it is almost always KL wins hands down. The opportunity is much higher if you want to climb the corporate ladder. For this, I would rate KL as superior.

Georgetown has UNESCO Heritage city status and will continue to attract huge number of tourists. KL is the capital city of Malaysia, has the largest international airport plus another spanking new Low Cost Airport. These are ahead of Penang. MRT is being built feverishly as we speak. Economic activities in KL is also much higher. Thus, for this aspect I would rate KL higher.

My personal opinion is, both places have great potential to continue growing. It will only stop if Malaysia have a huge ageing population which is unlikely to happen for now but may happen in the future. For the question of which is more expensive, based on the properties I own, Penang at this point is more expensive. Note that some other investors may have different opinion. It is ok, we need diversity or else everyone would chase after the same property which is again not good.

written on 12th dec 2013.

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Penang property – Villa Kejora

My wife and I jointly purchased our first apartment in Relau when we were just about to get married. We viewed no less than 20 properties in Penang before deciding on Villa Kejora. The three MAJOR reasons for us were: 1) AFFORDABILITY (of course)   2) Nice layout (kitchen was good enough for us)   and 3) near to my office (and not too far from my wife’s office)

It was only RM123k and we bought it from the secondary market. Mortgage payment per month was RM800. (Interest rate was higher then) We spent RM15k in total for renovation (mostly kitchen and toilet) and stayed there for 4 years before upgrading to a condo nearby in Sungai Ara. We sold off the apartment not too long ago for RM215k. Total net profit after deducting all renovation and expenses was around RM70k.

If you saved RM123K in bank and do not touch it for 10 consecutive years, you get RM50,504 (3.5% rate). So, I guess my total profit was slightly better than FD. 🙂  Yes, we paid interest on the mortgage but remember we also skipped paying rental since it’s our own home? I think the answer is clear. Buying is better than renting.

The apartment came with a so-so gym, ping pong room, reading room, 90% malfunction sauna room, a huge no frills swimming pool and one covered car park. From a deficit position, the management committee managed to turn everything around, hired a good management company and today, there are new flower plants and entry is by key card in both the car entry and also inside the elevator.

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Penang property vs Hong Kong property

Yesterday my friend who’s a manager with an insurance company asked, ‘do you think Penang property prices will be like Hong Kong in the future?’ I seriously DO NOT think so but it gave me an idea to just do some homework and share with everyone. We often see TVB serials where the typical family lives in an apartment. Do you want to know what’s the prices like for these families? I have done a little search in the famous real estate magazine which now has its own website, Squarefoot.
http://www.squarefoot.com.hk
  Size selected is 500-700 sq ft. Only apartments.  We will look at both the LOWEST and the HIGHEST. Look at the areas stated, some of them you know from the serials as very low end areas. For the highest, typically, we are talking about sea views and exclusivity.

So, do you think Penang property prices will reach Hong Kong levels? No one knows but I give you three more statistics for your knowledge. Hong has 7.1 million population versus Penang at 1.6 million. Hong Kong is one of the top financial hubs of the world and Penang does not even have even one HQ for any regional banks. Average salary for Hong Kong workers are HK22K or RM9,166. Average income for Penangites is between RM3,531 to RM4,407 as at June 2012.  When you look at the overall, it seems clear that the potential is there. In fact, based on just statistics alone, Penangites seem to be living better with their current average pay versus the average HK worker.

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Penang property vs Singapore property?

After reading my article on Hong Kong properties, a friend said he did not know that Hong Kong properties are that expensive. What about Singapore properties? Let us look at the same criterias again, 700sf, lowest and highest. As usual, online is our best teacher. Stats from
http://www.propertyguru.com.sg

Looking at the numbers, it does seem much better compared to Hong Kong properties. 🙂  The median gross monthly income for a worker in Singapore is S$3,480 (RM8,700).  To buy the cheapest HDB by cash, they only need to save their whole income for 6.5 years. 🙂   Thus, if you have intention to work in Singapore, as long as you make sure you are earning much higher than the average people there I think you should do ok. If you ask me though, I would prefer Penang anytime. No need to argue about whether Singapore or Penang is better. Penang is my personal choice. Settled.

Next Suggested Article: Penang Property vs Hong Kong property

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Penang property vs Tokyo property

Do you think Tokyo is more expensive than Hong Kong? I actually do not know. So, I decided to find out and share with everyone. Just for our general knowledge since property is something which is very important nowadays whether it’s for own stay or for investment. I searched:
http://www.realestate.co.jp
 which has thousands of listings. Around 700 sf, apartment, within Tokyo prefecture. Below are the results for the lowest priced ones. Typically, they are very old apartments. Some built in 1979! I think we can rely on them as it’s made in Japan. 🙂

The cheapest that we can ever find is Yen39,800,000 or also equivalent to RM1.244 million. Exchange rate is RM1 to Yen 32. This is over 8 times more expensive than a typical RM150,000 700sf, older apartments here in Penang.  Seems not too bad yeah? How much do an average Japanese earns? A fresh network engineer earns about Yen533,000 per month or RM18,299. I think  a Penang network engineer earns about RM2,600. This is about 7 times lower than his Japanese counterpart.

When we look at it this way, hey it seems that in terms of salary to apartment, there’s no big difference! There’s only one tiny little difference, I cannot find any other listings at this price. However, if I were to search for apartments in Penang for RM150,000 and below, I could find a lot of choices. 🙂

There’s little to debate. If we are to compare just in terms of prices and availability objectively, I still think properties in Penang is better than Tokyo. In other words, if both the network engineers chose to buy an apartment, the Penang one would have more choices, not to mention cheaper. His counterpart in Japan may really need to buy a very old apartment, perhaps built in 1979 if he is to say, ‘hey with my salary, I can also afford the same apartment as my Penang friend’.

written on 14th dec 2013.

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Penang property vs Hong Kong property

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Penang property – why I like Sungai Ara

Many years ago, when I was chatting with a fellow Toastmaster friend and he learnt that I was buying in Sungai Ara, he said I should have gotten a property in Bayan Baru instead. This is because Sungai Ara was not accessible and jammed all the time due to the bottleneck at the Relau and Sungai Ara traffic light junction. Few years ago, I had a very tiny disagreement with a HR professional on whether Gelugor or Sungai Ara is better. Just last week, my two ex colleagues were arguing about Tanjung Tokong versus Sungai Ara. Every time, it’s a different area versus Sungai Ara and yet I bought Sungai Ara. Am I foolish? If I was foolish then I am having the foolishness that the late Steve Jobs spoke about, ‘Stay Hungry, Stay Foolish’. I bought Regency Heights.

Accessibility. There are many roads into and out of Sungai Ara. There are internal roads leading to Paya Terubong and from there you can go to Farlim, Balik Pulau, Bukit Jambul etc. If you go down the hill from Regency Heights to the traffic light, if you turn right, you can take the road leading out to airport or go further and towards the Batu Maung / Gertak Sanggul etc. If you turn left, within less than one km, you come to a traffic light  whereby you can turn right to go to Bayan Baru or go straight to Relau / Bukit Jambul. It does seem that in terms of accessibility, it scored very highly. Sure, there are jams but if you can look at me and say, ‘there are no jams in Tanjung Tokong or Gelugor or Greenland or Bayan Lepas or Gurney, ‘ then I let you win this argument. Haha.

Convenience. When I first moved to Sungai Ara, there were not that many things. In fact my father said, Sungai Ara was a forest when he was studying in USM! Today, there are fast food outlet, nasi kandar, pharmacies, wet market, clinics, chinese medicine halls and even my favourite pasar malam! There are even schools and I think the only thing missing may be a bank. Oh yeah, even dim sum restaurant and the very delicious burger stalls.

Affordable property price. This is in comparison to many ‘hotter’ areas in Penang. I can safely say that there are not that many places in Penang left whereby you can get a very nice condo for Rm500psf; Regency Heights. Even Reflections by SP Setia is also priced very slightly higher. This is not the situation if we are talking about a 1,200sf condo in areas such as Tanjung Tokong or even Gelugor.

Perhaps the only thing that is not on Sungai Ara’s side is the perception. Come to think about it, I do not really mind because it is these perceptions that enabled me to buy a unit in Regency Heights during its launch eventhough I took one month to think and decide. Oh yeah, the properties that my friend bought in Gelugor has increased in price. Even my own condo in Tanjung Tokong has also increased in price tremendously. Perhaps the point that we should all concentrate is just ‘where I feel comfortable with’ instead of where the so called popular areas are. Did I mention I have friends who even swear that the water in Tanjung Tokong is more fresh than Sungai Ara? As for me, I still like Sungai Ara and have no intention to move to my new condo in Tanjung Tokong even if I my office is nearer to Tanjung Tokong.

written on 8 Jan 2014.

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Hold on first.  There’s an appeal in the courts now.

It’s important to have all sides of the story yeah. Development will always be important because it can be a catalyst of growth to the economy for example. However, development at the expense of the environment may not be clever. This is why it’s always a delicate balance. By the way, there are so many of the developments outside Malaysia where the nature is still nature and yet the visitors are aplenty and everyone is happy.

This has been going on for a while.It’s for Penang South Reclamation (PSR) which is part of the Penang TransportMaster Plan (PTMP). The reason by the state government very briefly is that the reclamation will provide the much needed funds for the continuation of the PTMP. As everyone would have read, the funds needed to continue propelling Penang to the next level of growth could be self-generated too. PSR was one of the ways.

Article in malaymail.com
  Penang Forum’s Khoo Salma Nasution says that the reclamation has to wait pending the appeal from the the Sungei Batu fishermen to the Department of Environment (DoE). The case is yet to be heard. She said, “The DoE has not form an appeals board to hear the case yet so the appeal case, which is the first of its kind in the country, is still pending.”

With regards to the state government’s claims that the PSR will mitigate climate change, she said, “The PSR is not climate mitigation but climate aggravation.” She added, “Reclaiming land by using sand from Perak and making it higher does not mitigate climate change, it aggravates it as they are digging sand from another spot and destroying the environment.” Please do read the
Article in malaymail.com

I would love to ensure the environment is protected. At the same time, I am pro-development because Penang needs to keep building itself up and not just keep milking what it has currently. Truth is, the traffic jams in Penang is already pretty severe and if we wait till the traffic jam comes to a gridlock, then the construction of more transportation options will become even more harder.

I always believe that there’s always a way to include everyone into the development. Of course, sincerity and pro-activeness must come from both sides yeah. Will continue writing about the latest development as they happen. PTMP is a catalyst even if I do not agree to everything that is being planned currently. Do read my articles often and you will know what are the things I think could change. Happy following.

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Penang: Got reclaim or no reclaim?

These two are at each other again. Urban Wellbeing, Housing and Local Government Minister Datuk Abdul Rahman Dahlan accused Penang state government of approving a total of 2,428 hectares of reclamation works to a developer in Penang. Penang Chief Minister Lim Guan Eng said this, “the minister has lost his mind, there were no such approvals, he must show proof if he says the Penang state government had approved such reclamation activity.” Abdul Rahman said that action will be taken against Lim for this approval. In fact, the state government must get approval from the National Physical Planning Council (MPFN) for any reclamation project of more than 100 hectares. Lim explained that this approval could not have been given because the state have no authority to approve any reclamation above 100 hectares.

As usual, it is important for any accuser to show proof because without proof, it is just another accusation.
 Show proof and it’s time for the accused to show evidence showing otherwise. I think this has been missing in Malaysia for quite some time. These days, some news are written sensationally, ‘floated’ into social media and the news would become viral. No one bothered to check and no one even know what they are actually forwarding! Social media means the truth? Anyway, we are now seeing this happening not just in social media but also in real life. Everyone has something to say and the media is all prepared to give space because their readers crave for such news.  Perhaps life has gotten too boring.

Penang has two reclamation which everyone is aware of. The Seri Tanjung Pinang Phase 1 (240 acres) which is considered completed and Phase 2 (780 acres) for which approval has been granted. Total size is thus 1,000 acres (404 hectares). Another one would be IJM’s reclamation for their ‘The Light’ project. The total size is 152 acres (61 hectares). This has recently been in the limelight because the new phase would be jointly developed by IJM with a Singaporean partner. Okay, there’s the potential upcoming reclamation ones which would be the payment for Penang Transport Master Plan (PTMP) partners. Actually, there’s just not enough information available to add up to 2,428 hectares yet. Will be awaiting for more details then. Happy reading.

written on 5 Sept 2015

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Penang’s secondary property market? Positive.

These days, when we are looking for a place to stay and wants it fast as well as the potential to negotiate for a good price, secondary property comes to mind. Let’s get to know some latest happenings in the Penang secondary property market, shall we? My friend, Raine & Horne International Zaki + Partners senior partner Michael Geh was speaking at the Malaysia Secondary Property Exhibition (Maspex) in Penang. Following would be some important points that he shared which I think everyone thinking about the Penang property market should also take note of.

In 2015, a total of 15,291 residential property transactions valued at RM6.17 billion was recorded in Penang last year. 77 percent of all the transactions were for properties priced below RM500,000. 16 percent are for properties priced above RM500,000 and 7 percent for properties priced above RM1 million. This shows that Penang still do have properties transacted at below RM500,000. Michael also pointed out that the secondary market has remained bullish despite the dip in overall property transactions.

In Penang, the residential property market for the first half of this year has dipped by about 14 percent from 7,743 transactions valued at RM3.14 billion in the first half of 2015 to 6,698 transactions valued at RM2.65 billion in the same period this year.  The secondary market remains strong this year despite the dip in the overall transactions. In the first six months of this year, the secondary market recorded 5,658 transactions valued at RM2.17 billion.

In comparison, only 1,040 units valued at RM478 million were transacted in the primary market. This means the secondary market makes up 84 per cent of the total transacted units for the first half of this year. When compared to the same period last year, the secondary market saw a drop of about 13 percent in transactions and 15% drop in value transacted.

Last year, in the same period, the secondary market recorded 6,325 transactions valued at RM2.55 billion. The primary market recorded 1,418 transactions valued at RM590 million in the first half of 2015, meaning it also saw a 20% drop in transactions and value transacted. The strong secondary market, which is also known as the sub-sale market, in Penang is the reason why we continue to organise the annual Maspex Penang.

Let us look at the national statistics in comparison.  Nationally, the total number of residential property transactions had dipped by about 15% from 119,446 transactions valued a total RM36.47 billion in the first half of 2015 as compared to 102,096 transactions valued a total RM32.7 billion in the first half of this year.

Out of the 102,096 transactions in the first half of this year, almost 82% were from the secondary market which stands at 83,647 transactions as compared to 18,449 transactions in the primary market. The secondary market only saw a 15% dip in transactions while the primary market saw a 14% dip when compared to the first half of last year.

In the first half of last year, the secondary market saw 98,067 transactions valued at RM28.26 billion, when compared to the primary market’s 21,379 transactions valued at RM8.2 billion. This shows that nationally, the secondary market is still thriving despite the overall outlook of a weakening property market.

In fact, the number of transactions in the secondary market is almost five times that of the primary market. It also goes to show that a major portion of the property transactions in Malaysia are in the secondary market, taking up almost 80 per cent of the total market share. This leads us to Maspex Penang, where sub-sale properties are showcased.

This year, over 5,000 units of properties will be featured by real estate agents throughout this four-day event that started on September 22 and will end on September 25. We have also lined up a series of talks over the next few days to cover topics such as opportunities in the penang sub-sale market, the legal aspects of purchasing properties, the direction of the property market in 2017 and also a look at feng shui.

This is the best opportunity for home buyers to visit the exhibition and find out more about secondary property dealings such as sales, rent and purchases.

I think it’s good to drop by and look at all the options available. It’s no longer just about the Penang island but these days, mainland is also getting popular. As many would have noted, Batu Kawan is one such potential area too even if there are not a lot of happenings yet. Happy browsing and listening to all the talks in MASPEX Penang. It’s in Queensbay Mall.

edited on 23 Sept 2016

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Penang Sentral phase 2 on the way… When and where is this?

Public transportation should be the way forward and will have to be the way how most people travel in the future. This should not happen just in Greater Kuala Lumpur but also in Penang (both island and mainland). We already have the Penang Transport Master Plan (PTMP) for which the latest announcement is that the work on the Penang South Reclamation (PSR), Pan Island Link (PIL) and Light RailTransit (LRT) will start construction by Q4 2020. It’s not just these huge projects yeah. There’s also the hub called Penang Sental in Butterworth.

Article in nst.com.my
   MRCB Land chief executive officer Raymond Cheah shared that the phase 2 of the billion ringgit Penang Sentral integrated mixed-development project in Butterworth will go full swing next year. The second phase entails an office tower and retail mall. Cheah said that the office tower and retail component would serve as a catalyst to the transport hub in Butterworth.

He said, “We are accessing the market. We may start building the office tower first to build up the population before establishing the mall.”  He added, “There is a cargo hub and oil depot. Further north is the North Butterworth Container Terminal, with berthing and storage capacity, while further south is the Prai industrial zone comprising light and heavy industries. We believe there will be additional requirements for office space, retail, and apartments.” The Penang Sentral is an integrated hub for bus, rail (KTM Bhd’s electric train service and Komuter train services) and sea transport and costs about RM230 million. Please do read the
Article in nst.com.my

Butterworth is definitely not a quiet place even if Penangites love to compare between the island the mainland and the islanders believe their food is the best while the mainlanders will disagree. Property prices continue to show a wide gulf with island being 30-40% more expensive usually. With continuous development and links, perhaps the price gap will be lower in the future. Not in the near future okay.

Another recent development in Penang island would be this:
Eastern Seafront Development
  The more the merrier yeah. In the mean time, please focus on making the Penang International Airport much bigger than today yeah. Tourists need to come if Penang would like to have a vibrant economy and flights will need a bigger airport too. I wonder when will be my next trip back to Penang.

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Penang-Singapore VTL starts in 11 days

Penang-Singapore VTL starts in 11 days

I cannot claim I know Penang well enough if compared to a Penangite. 🙂  However, I can easily claim I know Penang very well versus anyone who’s stayed in Penang less than 15 years.  Haha. Yes, I started my career after graduation in Penang for the first 15 years of my working life. I was 21 at the same and I stayed until 36. Penang is a very attractive place for tourists. It’s also convenient to working people too. Everything is just so nearby! More about this below the news article yeah. For now, let’s just take in this good news.

Article in nst.com.my
   State Tourism and Creative Economy Committee chairman Yeoh Soon Hin said that the Penang-Singapore Vaccinated Travel Lane (VTL) will be starting March 16. He said, “The VTL scheme plays a pivotal role prior to the full resumption of international tourism as it will serve as the benchmark for future international travelling activities.

Penang has long been instilling the importance of standard operation procedures (SOP) compliance among industry players and members of the public, which is evident through the Responsible Tourism campaign.”

Yeoh, during a visit to the Penang International Airport (PIA) in Bayan Lepas On Tuesday, had said the airport had put in place all the necessary preparations for the launch of the Penang-Singapore VTL. Do read the full article here:
Article in nst.com.my

Tourists in Penang?

Imagine just walking around the UNESCO Heritage places, feeling the vibes, stopping for a bowl of cendol, speaking to some locals and well just hanging around. The only issue is perhaps the sun but the sun is better than the rain…  As for the working people… one can leave work at 6pm and by 8pm, walking along the beaches in Ferringhi and feeling the sea breeze. It’s REAL SAND by the way.

Working in Penang?

During the weekends, visit the National Park, go up the Bukit Bendera, enjoy ESCAPE Penang and more. How many places in this world where one could actually do all that and everything is like 30 minutes from one another or less. Even if there are, Penang is one of them yeah. Now for some good news for Penang economy. Many Singaporeans may be dropping by very soon.

Yes, I still have properties in Penang

I have moved to KL for 9 years. I remain invested in Penang properties. I do think that it’s a long term investment and will not sell unless someone offered me good prices. I have told my good friend who’s a really good Real Estate Negotiator about my ‘desperate’ selling price and he has been laughing since few years ago and he is still laughing today. Haha. It’s okay, let’s hold for a while more.

Happy travelling to Penang for my Singaporean friends. It will be a worthy vacation.

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Penang Technology Park has a GDV of RM4.2 billion

Penang is a hub for engineers, definitely.

My brother and my two brother-in-laws are still in Penang and all three are engineers. All three has every intention to continue to be in the engineering field in Penang. All three has more than one property and are all contributing to the economy of Penang wholeheartedly too. I think there are many well-planned Free-Trade-Zone parks which has been supporting the state’s economic growth. We now have another one known an Penang Technology Park @ Bertam. It will be spearheaded by a local property development outfit; Ideal Property Group.

Article in nst.com.my
   The new Penang Technology Park@Bertam, which will be completed in two years, will be the next exciting satellite city for Penang, according to Ideal Property Group executive chairman Tan Sri Datuk Alex Ooi.

Ooi further said that the technology park, with a gross development value of RM4.2 billion, represented a new milestone for the Group.

Penang Technology Park is situated on 356 hectares of freehold property in the municipality of Bertam. It will be the first cutting-edge technology park built in the North Seberang Perai district.

Penang Chief Minister Chow Kon Yeow said the project was a timely boost for the state as it will spur the development of other related projects, especially in the north Seberang Perai district. Do read the full article here:
Article in nst.com.my

Penang will not be growing like the Klang Valley but Penang is the only Pearl of the Orient yeah

There are not many islands which has electronics manufacturing and R&D hub status like Penang. Within this electronics hub is Georgetown which is a UNESCO World Heritage City. In other words, modern technology and cultural and historical significance are both within the same island. Coupled this with Penang International Airport which is the 3rd busiest airport in Malaysia and one is well connected to the world!

I have not even started to talk about all the famous food in Penang yet. It’s a melting pot yeah and it’s super hard to pinpoint just one food which one loves. Yes, I continue to own properties in Penang and thinkf of it as my home too as I was based in Penang for the first 15 years of my working life after degree. Keep up the good news yeah.

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Great problem Penang; too many affordable homes, soon.

Reported in an English daily, Penang would soon have way too many affordable homes. When there were not enough, everyone shouted and wanted more units made available. When there are now up to 34,608 units worth RM7 billion coming up within 3 to 4 years, suddenly there’s way too many? According to the report, 15% of the 34,608 units being built are for RM200,000 – RM300,000 while the rest are all the RM300,000 – RM400,000 range. According to REHDA, two major reasons why these units were still available is because of the income eligibility limit. It’s way too low. Many of the prospective buyers could not buy because their salaries have exceeded the RM8,000 and RM10,000 gross household limit. The rest were barred because it was not their first property, could not get a bank loan or they do not live in Penang.

Allow me to question a bit on some of REHDA’s reasoning. Any reason why those who already have a property be allowed to buy these affordable units again? Aren’t these supposed to be for those who could not afford the high property prices and needed them in the first place? Second question, if they do not live in Penang, WHY would they be allowed to buy these affordable properties? They should at least work and stay in Penang. No? Also, I seriously am not sure why many of the prospective households with RM10,000 or higher incomes did not yet buy a property? Even though the newer ones are expensive but there were still secondary choices. Or are they really waiting for the next financial crisis to happen? If they were all waiting for the affordable homes, then I think they should get it soon. Hopefully, they have registered.

What happens when these affordable properties were not taken up? Simple. If the developers continue to build, there would be huge oversupply or the developer may choose to just abandon the project or not to start at all. If there are oversupply, this is actually healthy for the overall market. The buyers may have opportunity to get a cheaper property than currently. One solution proposed by REHDA Penang chairman Datuk Jerry One is to allow the developers to sell the units in the free market to ‘unqualified buyers.’ Of course these ‘unqualified buyers’ must be compelled to hold the property for a number of years before being allowed to sell. I personally have no issue with this suggestion. If they are really building and there are no takers, then why not sell to those who are interested but do not qualify?

The only thing that I think the state government should do is to really understand what the real need is. Are there really a huge oversupply of affordable homes? If there are because these affordable homes are still NOT affordable enough, would it not be better to speak to the developers before they start selling or building? Readjust the pricing so that the lower income Penangites could afford them. Awaiting the response or actions. 34,608 units are huge and early intervention is necessary before everything gets worse. It’s a good problem though; too many affordable homes.

written on 22 June 2015

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Penang tunnel and related highways; a hiccup with Astral Supreme’s pull out

Remember Penang’s tunnel project? The tunnel project which would include a 6.5km undersea tunnel connecting Penang island to the mainland. There would also be a 12km paired road between Tanjung Bungah and Teluk Bahang. This includes a bypass between Air Itam and Tun Dr. Lim Chong Eu expressway as well as between Gurney Drive and Tun Dr. Lim Chong Eu expressway. The total overall funding estimated to be RM6.3 billion and once project is completed, Consortium Zenith is permitted to collect toll for the undersea tunnel for 30 years at toll rates similar to the Penang second bridge. Current bridge toll for the second bridge is RM8.50 To those who are asking, why toll? Let me tell you this, honestly, toll is needed unless YOU are the one building it for charity.

There is a small hiccup though. The main developer, Astral Supreme Construction is pulling out after saying that it was unable to find consultants who could undertake the project within the budget and funding requirements. Zenith PMC, the consortium said that Astral’s exit is because it could not fulfil its obligation which is to jointly manage, perform and carry out feasibility studies and detailed design of the project. It said however that the feasibility study has been done by professional consultants and is scheduled to be submitted to the Penang state government soon. Consortium Zenith includes the following partners, Ewein Bhd, Zenith Construction Sdn Bhd, Beijing Urban Construction Group Co Ltd, Juteras Sdn Bhd and Sri Tinggi Sdn Bhd.

Personally, I think this is not a small project. In fact this project will be able to being lots of development to both sides once completed even if there are some Penangites who said that since the second link is not even used, why bother with the third one so soon? With such a huge project, the state government must really ensure that whoever appointed must have the expertise and the funding required to carry it out. Seriously, I am looking forward to the detailed plan as per what was announced by the Consortium Zenith. There has not been that many undersea tunnels throughout the world and to have one in Penang is quite special. Will update once the report is open to the public. Construction expected to start in 2016.  🙂

written on 21 Aug 2014

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Penang Tunnel is still ongoing, feasibility study to be completed

As per reported a day earlier, Consortium Zenith BUCG Sdn Bhd (CZBUCG) chairman Datuk Zarul Ahmad Mohd Zulkifli said the feasibility study has been stopped one month ago. By the next day, he clarified that it was just a miscommunication. The feasibility study will be completed and he said that he was also inviting some members of the press to go to China to see what China Railway has done with the undersea tunnel there. This proves that Penang tunnel project is still continuing. In fact, 83 percent of the feasibility study has been completed and remaining 17 percent could be completed within 6 months. He said, “We have good consultants looking into it and it is definitely feasible.”
Good to see him showing confidence with the project.

The Chief Minister of Penang, Lim Guan Eng said “Even if the feasibility study for the tunnel, which forms a part of the DEIA, is completed but approval for DEIA is not received for the tunnel, the project cannot proceed and the contractor cannot claim compensation from the state government.” He then reiterated that the undersea tunnel would most likely be completed in 2027. This is 11 years from today. Perhaps by then the second bridge would already be busy enough unlike today. Guan Eng then shared that the the feasibility study could also be turned into one for a third bridge if the federal government would approve it. If it’s a third bridge, then it will be toll-free. Frankly, I would prefer a toll-free bridge instead but need to know who would be maintaining the bridge.
Reminder, building is great but maintenance is key to continuous usage.

The company tasked with the construction of three highways is CZBUCG, which consists of Zenith Construction Sdn Bhd, Beijing Urban Construction Group Co Ltd, Sri Tinggi Sdn Bhd and Juteras Sdn Bhd. The three highways are a 4.2km bypass from Gurney Drive to Lebuhraya Tun Dr Lim Chong Eu, a 4.6km bypass between Lebuhraya Tun Dr Lim Chong Eu and Bandar Baru Air Itam, and a 12km paired road from Jalan Tanjung Bungah to Teluk Bahang — and the 7.2km undersea tunnel. The total cost for the project is RM6.341 billion. Last but not least, Datuk Zarul said that their focus is to complete the all the roads by 2022 while the tunnel would be 2027. Keep following and reading.

written on 17 June 2016

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Penang Turf Club, PTMP and Batu Kawan

When I was still based in Penang, I was looking forward to the Penang Global City Centre (PCCC) project. Yes, I know many hated it with a host of reasons etc. These people won. It did not happen and well, it has been many years since the last update of that piece land which is actually in a very strategic area. Some time back, an article was published in The Star highlighting a few facts as follows:

The estimated gross development value (GDV) was RM25 billion. Total of 15 years to fully develop the land. (GDV Should be much higher today)

A new turf club would have to be built for PGCC to proceed. The site would be in Batu Kawan, Penang. (land costs are now much higher, so are construction costs etc).

PGCC was supposed to have been a zero-carbon city where pollution is minimal. (Honestly, I do think that pollution is due to the people, not so much of development per se)

Total size of the land is 104ha. It would consist of two five-star hotels, a Penang performing arts centre, a retail complex, two iconic office towers at 200m tall (designed by New York-based Asymptote Architecture, appointed by Abad Naluri.), residential properties, a world-class meeting and convention centre, an observatory tower, parking space, monorail transportation, as well as a public arena.

There would also be a 10.4ha public park that will be linked to Penang Botanical Gardens and Municipal Youth Park. (This is a good one, at least less congestion because during certain times, it’s crazy at the roads nearby the current two public parks).

Two flyovers were tone built to alleviate the congestion along Jalan Scotland. (Until now, Greenlane is still a bottleneck during peak hours, maybe even more these days)

Some estimated land value from the valuers pointed to a RM350 per sq ft current value. In other words, RM3 billion to buy the land alone. (If we believe land cost to be less than 10% of GDV, then we are talking about a much larger GDV than the RM25 billion previously planned)

The land value has NOT yet included any new equestrian club in Batu Kawan or any other areas in Penang. The estimated cost for this new club would be around RM600mil to RM1bil. (Okay, if this is also taken into calculation, no wonder we have not read about any serious private developers thinking about reviving a ‘PGCC’ development there)

I may be wrong because according to Raine and Horne Malaysia senior partner Michael Geh, “It is not surprising if the Penang Transportation Master Plan) PTMP proposal and the currency situation today has renewed interest in the property, as the price of such a prime property and the cost to develop it overseas would be astronomical.” There are really not many properties similar to the Penang Turf Club land. Even the location is a prime one and definitely one which many Penangites love compared to other secondary areas.

Actually, there are lots of other development costs being mentioned as the never ending obstacles to the revival of this ‘PGCC.’ Suffice to say, time would enable the GDV value to exceed all these considerations. Only one question remain. If this is taken into account as part of the PTMP, then what would happen to the proposed reclamation? Actually, that one was estimated to be between RM7 billion to RM8 billion. Read here:
Wait, stop speculating. Reclamation for PTMP is not confirmed.

Let’s not discount the spillover effects from a new PTC to any area that it is built on. In fact if it is in Batu Kawan, I think it will bring more cheers to the area which at this moment remain secondary for many of my Penangite friends. They would look at me and smile when I ask if they are moving to Batu Kawan since there is now a second bridge. One friend even bought a place there but continue to stay in the island side. Somehow, that ‘cool’ factor is not there. Perhaps there’s just not enough excitement yet. Waiting for IKEA and University of Hull perhaps. 🙂

I am all for more sustainable development because Penang would be gridlocked in the future without any firm and serious decisions on a transportation masterplan. Any decision to enhance public transportation needs to be supported by funds from developments. In this case, either the reclamation or perhaps this PTC. Else, the government of the day would just assume debts, debts and debts which ultimately benefits no one. Happy anticipating as the PTMP environmental impact assessment (EIA) is still 6 months away from what was published in medias.

written on 29 Dec 2015

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Penang undersea tunnel, RM6.3 billion and 30-year toll concession

I have yet to really understand the need for the Penang Undersea Tunnel Project linking Gurney Drive in the island with Bagan Ajam on the mainland side. I tried to search for the estimated number of vehicles which will use the link when it’s completed but could not find any as yet. As per reported in many media recently, the undersea tunnel would cost RM6.3 billion of which RM5.4 billion is for construction cost, RM540 million for land acquisition and RM305 million for feasibility studies including a detailed design for the project and environmental impact assessment. This study would be completed by July 2016. Let’s look at all the information which I could find online today.

Main contractor is Consortium Zenith BUCG. Its chairman is Datuk Zarul Ahmad Mohd Zulkifliin

As per Datuk Zarul, the undersea tunnel will be tolled so that the Sultan Abdul Halim Mu’adzam Shah Bridge (Penang second bridge) will not lose its traffic. (else, compensation may be claimed from the Federal Government by Jambatan Kedua Sdn Bhd). The toll rate would match that of the second bridge.

The toll concession is for 30 years and the builder would also be receiving payment-in-kind of 110 acres (44.5ha) of land.

As per Penang State Works Committee chairman Lim Hock Seng, this toll for the tunnel is to cover maintenance, repairs and operations. The RM305 million budget for  is just 5.54 percent of overall construction cost.

The feasibility study, detailed design and environmental impact assessment is currently 83 percent completed.

The actual tunnel is at least 20 metres below the seabed.

The four-lane 7.2km long tunnel’s completion is expected in 2025. (9 years from now)

Currently, RM135 million has been paid to CZBUCG as this is advance payment for the detailed design works that had been carried out.

As at two weeks ago, when I was driving past Penang’s Second Bridge, I still felt that the number of vehicles on the bridge remained low. Perhaps that was because I was driving across the bridge during a weekend. I am always supportive of more connections because it would mean more economic activities between both sides (island and mainland). Please be as transparent as possible in terms of all the benefits from the undersea tunnel. Two questions which I believe should have some answers. How much would be the expected toll collection for the 30-year concession? What would happen after the 30-year concession? Let’s keep reading.

written on 11 May 2016

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Penang Island vs Mainland (Part 1/4)

There are a few people I talk to when I want to know latest updates for Penang property market. One of them is the founder of
penangpropertytalk.com
, Mr. Ken Lim. Many weeks back, we spoke about how mainland may be changing and he said that he would research and do articles to compare mainland and island. After all, if one were to just say something without any support from facts and figures, it would amount to just preference and not an objective opinion. For knowledge, please refer below: (Part 1/4)

-START-

In Penang, one of the most intense debated topic is the property investment and purchase decision between the properties in island and mainland. The island which is well-known for its “scarcity of land” has always been the top property investment choice for both locals and foreigners, whereas the mainland is always named as the secondary option for a bigger house or an affordable alternative.

Many people told me that they prefer to invest into property in the island due to its limited land, higher-class shopping malls, well-known tourist hotspot, beautiful beaches and not forgetting the good food. I would have to agree that these are some valid reasons. But if we are buying a property for own stay, how much does it really matter to us?

A branded location

The branding of a location can give it a competitive edge. Sometimes this can be one of the most powerful factors in a property investment decision. When we mention “Penang”, the first thing that comes to our mind is the Penang Island – A glamorous location that is well known for land scarcity. To some people, Penang Island is a branded city with pride in its properties, beaches and food.

Georgetown, Seri Tanjung Pinang, Tanjung Tokong and Gurney Drive are some of the top location brands in Penang Island. Properties in those areas are usually at least ~30% more expensive than the properties of similar density in other locations within the Island. RM800k is the sweet spot. Anything around this price range would likely to see a respectable take up rate.

Mainland on the other hand, has always been perceived as an affordable alternative for those who cannot afford a landed in the island. Most people knew Butterworth, Perai, Seberang Jaya and Bukit Mertajam. But none of them is perceived as a prominent brand to the penangites.

However, things has started to change in the recent years. Developers have started to focus into the mainland, taking advantage of the cheaper land cost that they have purchased many years back. For example, Alma, some used to have a certain perception about it. But DNP has changed the perception of that area with series of well planned residential and commercial developments such as AEON mall and Tesco hypermarket along Jalan Rozhan. Landed property at a strategic location in mainland is no longer cheap. Newly launched terrace houses are mostly more than RM600K. If you are looking for something less than RM500K, you would have to go to the southern part of Seberang Perai, namely Simpang Ampat, Jawi and Sungai Bakap.

For Batu Kawan, the upcoming development by Eco World, Aspen Group and PE Land is expected to have a positive and transformative effect on the property market in the region. The rapid development toward urbanization makes location branding an important determinant of its success over the next decade. Desa ParkCity is one unique example how Perdana ParkCity Sdn. Bhd. has transformed a piece of vacant land in Kepong into one of the most sought after self-contained township in Klang Valley. Who knows? May be one day you will feel proud to have owned a property at Batu Kawan.:)

Coming back to the reality, today there is nothing wrong if you were to choose a branded location like Gurney Drive, or a less-branded location like Simpang Ampat, or a new brand at Batu Kawan. Most importantly it fits your budget and suits your lifestyles. At the end, we may be working at the same place, eating in the same restaurant, shopping in the same mall and watching movie in the same cinema.

-END-

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20,912 units to help Penangites own a home

20,912 units in Penang to help people own a house.

I am one of the few people who kept telling everyone that we need a property so that we do not pay rental forever and ever. Do remember yeah, we will always need a place to stay and if we have children, they will need a place to stay.

Fully Paid versus Paying Forever

The property when fully paid could belong to us 30 years later or we could continue to pay until our children could take over and continue paying and it never ends… So, Penangites should be happy with this news from the Penang state government.

Article in edgeprop.my
   State Housing, Local Government and Town and Country Planning Committee chairman Jagdeep Singh Deo announced that there are 10 housing projects which will be developed in Jelutong, Perai, Ampang Jajar, Juru, Bukit Mertajam, Butterworth and Bandar Cassia and the total units is 20,912.

He said, “With these 10 projects, the total house supply in the state will reach 220,000 units, including low-cost, low-medium and affordable ones by 2030.” He also said that the price of the houses would range from RM42,000 to RM300,000 per unit, depending on the type. Do read the article in full here:
Article in edgeprop.my

Prices will rise… even if slowly

My very first home was an apartment called Villa Kejora in Relau, Penang. I bought that property for RM123,000 in 2003. I sold the property 10 years later for RM215,000. That was in 2013. Today, the property is being put up for sale at between RM275,000 to RM299,000 in propertyguru.com  Please refer to the image as below. Updated as at 949pm 25th July 2021.

How much has it increased? Simple Calculation.

2003 – RM123,000

2021 – RM275,000

Total increase: RM275,000 – RM123,000 = RM152,000

Total number of years = 18 years

Total increase per year = RM152,000 / 18 years = RM8,444 per year

RM8,444 / RM123000 x 100 = 6.87% per year.  NOT BAD AT ALL! 🙂

Happy understanding yeah, even for an apartment of 700 sq ft, we can still enjoy a simple increase of over 6% per annum.

Of course, someone would like to say that we also have to include the maintenance fee… taxes… etc etc and etc. Noted on your comments yeah. I will still buy that apartment and I will still think an increase of over 6% over 18 years is a very good number.

Briefly, it’s a hedge against inflation because if I did not buy that property at RM123,000 I do not think I could have saved extra RM8,444 extra without fail… I think it would have been spent buying things online instead. That’s one fact too. Thank you.

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