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Asia Property Report

Daily, Bangkok
Up-to-date news and coverage of industry trends and innovations from Asia with an in-depth special focus on real estate hot spots, as well as key interviews with important industry figures.

Kuala Lumpur's property market sees high growth in transactions

Apr 04, 2012
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Kuala Lumpur's property markets has seen the highest growth in transaction in 2011.

The Sun Daily reported that the property market in Kuala Lumpur has seen the highest growth in transaction in 2011 over the last five years with a total of 430,403 transactions. This is a 14.3 per cent growth in volume from 376,583 transactions and 28.3 per cent growth in value in 2010.

Deputy Finance Minister I Datuk Donald Lim Siang Chai said last year saw several big value transactions including Wisma Shun Li in Kuala Lumpur, Lanai Complex in Putrajaya, Kemayan City in Johor and East Coast Mall in Pahang.

However, the residential sub-sector continued to drive the property market, accounting for 62.7 per cent of the total transactions recorded.

"In the primary residential market, the sales performance was in an upward trend from 2010. Almost 50,000 units were launched and out of the total, over 22,000 units were sold. Sales performance was at 46.3 per cent. Affordable housing below RM250,000 (US 81,640.75)saw high demand, making up 45% of the total new launches,” he said.

Lim also said the commercial sub-sector recorded over 80 per cent occupancy rate for purpose-built office while take-up space exceeded 250,000 sq metres last year, with 40 new offie buildings entering the market.

Lim said barring unforeseen circumstances, the property market will be good this year as the government cuts down on red tape for faster and more efficient transactions. He said an average growth of 10-15 per cent per annum in terms of house prices is considered healthy.

He said there is no property bubble and prices are reasonable with increases in certain areas only. He added that if property prices go up, the ministry will put in place cooling measures, such as increasing the real property gains tax (RPGT) at a moderate pace.

Lim said while 43 per cent of Malaysian households own two properties each on average, there are 20 per cent who do not own any home.

On the overhang in commercial and office space, he said the take-up should not be an issue as more companies are keen to have their headquarters in Malaysia.

"Recently, there have been a lot of foreign buyers in Malaysia, especially those from the Middle East and China. This is a good sign,” he said.