City&Country: Cover Story-- The Edge/Rahim&Co Kota Kinabalu Housing Property Monitor (1Q2011)

By E Jacqui Chan of The Edge Malaysia

KK on the move



Kota Kinabalu in Sabah, fondly known as KK by Malaysians, was first called Api Api, and then Jesselton, before taking its present name in 1968. 

What started out as a small British settlement in the late 19th century has since become one of the country’s busiest cities and a popular tourist destination. 

Conferred city status in 2000, KK has grown tremendously and is now home to about 48% of the three million population of Sabah.


The city accounts for about 26% of Sabah’s total GDP, and was projected to contribute about RM9 billion to Malaysia’s GDP for 2010, ranking eighth among the country’s urban areas.

Mount Kinabalu

Over the past five years, the service sector has been Sabah’s key engine of growth, contributing about 50% to the state’s GDP, followed by the agriculture sector with 25%. In an effort to promote balanced development, the government has identified Strategic Development Areas (SDAs) within the Sabah Development Corridor (SDC) under the 10th Malaysia Plan to accelerate economic growth. The total value of investments targeted for the SDC by 2020 is about RM16 billion. 

Among the SDAs is the Kinabalu Gold Coast Enclave, which counts among its key economic activities a creative industry cluster, wellness and healthcare, floriculture and specialty natural products, marine sports, signature resorts and holiday homes.

“We foresee these economic activities to have a positive impact on the local economy, especially in terms of creating demand for commercial as well as residential properties,” says Saleha Yusoff, head of research, Rahim & Co, when presenting the inaugural The Edge/Rahim & Co Kota Kinabalu Housing Property Monitor. 

The overall property market in Kota Kinabalu saw an improvement for the 12 months from 1H2009 to 1H2010, registering an increase of 18.7% in transactions and 55% in transaction value.

Based on data from the National Property Information Centre, the growth in the number of transactions was led by the industrial subsector at 62.2%, followed by agricultural at 47.1%. The commercial, development land and residential subsectors rose by 42.4%, 27.8% and 9.1% respectively.

However, the residential subsector contributed 66.5% to total transaction volume, followed by commercial, industrial, development land and agricultural at 24%, 4.8%, 3% and 1.7% respectively. 

In terms of total value of transactions, the commercial subsector was the best performer, rising by 145.5%, followed by development land, agricultural, residential and industrial at 64.3%, 43.1%, 29.2% and 12.2% respectively.

Supply and demand

Over the last five years, the total supply of residential properties in Kota Kinabalu grew at a compound average growth rate (CAGR) of 5.16%, compared with a CAGR of 6.18% for the state.

The supply in Kota Kinabalu represented about 35% of total supply in Sabah, says Saleha. 
The highest growth in residential properties over the last five years was seen in low-cost flats (8.13%), condominiums/apartments (7.97%) and 2 to 3-storey terraced houses (5.47%). 

Two to 3-storey terraced houses made up 26.5% of total housing supply in 2010, followed by condominiums/apartments at 22.7%.  

Demand for residential properties in Kota Kinabalu grew at a CAGR of 8.5% over the last five years, compared with the state’s CAGR of 11%. 

In 1H2010, residential transactions in Kota Kinabalu amounted to 36.3% of total residential transactions in Sabah, followed by three other major districts — Tawau (19.1%), Penampang (15.5%) and Sandakan, Labuk, Sugut, Tungud, and Kinabatangan (13.3%). 

In terms of prices, the largest number of transactions recorded were for properties priced between RM250,000 and RM500,000, which comprised about 30.7% of total transactions recorded in 1H2010. 

The most popular housing type in 1H2010 were condominiums/apartments followed by 2 to 3-storey terraced houses, making up about 30.8% and 26.9% respectively of total transactions in 1H2010.

About 42% of the transactions for 2 to 3-storey terraced houses were priced at between RM200,000 and RM500,000.

Kota Kinabalu also recorded the highest number of transactions for condominiums/apartments in Sabah — 293 units or 76.5% of the state’s total. About 30.4% of the total condominium/apartment transactions were priced at between RM250,000 and RM500,000.

Take-up rates for newly launched projects have been very encouraging, ranging from 40% to 60%. Buyers were mainly locals as well as those from Sarawak, Brunei, Kuala Lumpur and Singapore.

Saleha notes that a few ongoing developments are attracting interest from locals as well as foreigners. These include The Manikar, Kingfisher Palm House, Taman Bukit Sepanggar, Alamesra and The Peak Vista.

“According to the developer, some of the buyers of The Peak Vista are Singaporeans and most are buying for investment,” says Saleha, adding that the leaseback option makes the development more attractive. 

The Peak Vista, priced at RM518 psf with built-ups of 1,293 to 2,448 sq ft, is the tallest condominium in KK, offering views of Tanjung Lipat and the South China Sea. 

Alamesra,  a 265-acre eco-cyber township located less than 10 minutes’ drive from the city centre, has launched boutique bungalows with built-ups between 3,950 and 5,000 sq ft. Townhouses launched in the development have all been sold. The boutique bungalows are priced at an average of RM460 psf, with a minimum selling price of RM1.8 million.

Saleha says the bungalows feature  innovative, contemporary and tropical concepts not commonly offered in Sabah. 

Capital values and rental rates

In the secondary market, 2-storey bungalows in Taman Bukit Sepanggar are selling at 
between RM380 psf and RM550 psf. Prices and rental values of residential units in the secondary market indicate a mostly upward trend, says Saleha. 

Sampling for the housing monitor shows that the value of 2-storey terraced houses rose 8.33% in 1Q2011, compared with a year ago. Two-storey terraced houses in Taman Indah Permai, situated within the maturing Sepangar area,  were going for RM260,000 in 1Q2011 compared with RM240,000 in 1Q2010. 

In more established areas such as Luyang Perdana and Millenium Heights, capital values of 2-storey terraced houses rose between 7.41% and 7.89% while those at Golden Hill Garden, touted to feature the most expensive 2-storey terraced houses in KK, rose 6% from RM500,000 in 1Q2010 to RM530,000 in 1Q2011. Saleha observes that the capital values for properties in Golden Hill Garden can go higher than RM530,000 for units with improvements.

Capital values for most of the standard 1-storey terraced houses with land area of less than 2,000 sq ft have yet to reach RM300,000 per unit. Taman Nelly Phase 9 registered the most notable growth with 13% appreciation in 1Q2011 compared with 1Q2010.

Condominiums

Meanwhile, upmarket condominiums in trendy areas such as Signal Hill, Likas and Damai have been showing attractive capital appreciation. 

Marina Court, Jesselton Condominium and The Peak Condominium registered the highest capital values of between RM400 psf and RM450 psf during the period in review.

The most notable growth was seen in the newly completed Alam Damai in the Damai area. Condos there, priced below RM300 psf when first launched in 2006, have now climbed to as high as RM380 psf in the secondary market.

Values in Marina Court — once touted as the KLCC of Kota Kinabalu — only rose 2% in 1Q2011 from 1Q2010. Saleha attributes this to the maturing market for other high-rise developments. 

Nevertheless, Marina Court  still commands the highest value on a psf basis in KK.  

Capitalising on its strategic location, The Peak Condominium in Signal Hill and Jesselton Condominium in Damai recorded transactions at prices of RM440 psf and RM400 psf respectively, representing a growth of 10% and 5%. The growth is partly due to the strong demand from foreigners, says Saleha. 

As for the rental market, residential units in the secondary market indicate a rising trend with upmarket condominiums such as Signal Hill, Likas and Damai registering attractive rates. Over the past four years, rents for condominiums have increased by 5% to 10% per annum. 

Nevertheless, the housing rental market in general is slow with low yields. “Unlike the property market in Kuala Lumpur where there is a good mix of investors and owner-occupiers, the KK market consists mainly of the latter. The rental market here is not as active, making it difficult to get good rates,” says Saleha. 

Market outlook

Saleha expects the residential sector to dominate the property market, supported by easy access to financing and favourable lending rates. 

Areas in Signal Hill, Luyang, Likas and along the Sulaman Coastal Highway leading to the north of  the city centre are the current hotspots for residential properties. The growing pattern of strata-titled properties is anticipated to continue in the next three to four years, mainly focused on areas such as Signal Hill, Likas, Damau and Kepayan. 

Developer Bina Puri Holdings Bhd is reported to be focusing on two high-rise residential developments — Jesselton View and OneJesselton @ Kepayan. Comprising 80 apartments, the estimated gross development value of Jesselton View is RM66 million. 

Despite concerns that the market is getting too pricey for the locals, take-up rates for high-rise developments with good accessibility and contemporary themes and lifestyle are expected to remain strong, with interest from both locals and foreigners.






This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 853, Apr 11-17, 2011

Residential property prices may see some correction this year

KUALA LUMPUR: Residential property prices may see corrections this year. Having escalated too quickly last year, property prices may soften for certain products in certain locations, said Swhengtee International Sdn Bhd founder and president Gavin Tee.

“It will depend on the type of property and location. You have seen prices rising since 2007, and last year’s level was especially high. Areas that don’t normally have high appreciation have also seen impressive capital gains. I expect some corrections this year,” he told The Edge Financial Daily at the Third Anniversary Swhengtee Property Talk on Wednesday.

At the talk, Tee advised participants that some “very hot” markets could overheat. He noted that property cycles in some so-called property investment “hot spots” were also getting shorter.

“Investors must learn to study the product and verify the information about it. They shouldn’t make their buying decisions based on their impressions of the product or the salesperson,” he added.

He noted that over the long term, the next few years until 2020 would be a good period to invest in property, mainly due to the implementation of developments under the Greater Kuala Lumpur Plan with the aim of supporting 10 million residents.

Greater KL will encompass 279,327ha, an area four times the size of Singapore. It is envisaged that by 2020, seven out of 10 Malaysians will be living here. It will be a livable city and an economic hub covering 10 municipalities with more open spaces, improved waterfronts and a superior public transport system.

Tee: Investors shouldn't make their buying decisions based on their impressions of the product or the salesperson.

Covering Klang and Sepang, and stretching past the Selangor coastline, Greater KL will also include the green belt of Templer’s Park in Selayang.

Other municipalities that will make up Greater KL are the Federal Territory of Kuala Lumpur, Putrajaya, Ampang Jaya, Petaling Jaya, Subang Jaya, Shah Alam and Kajang.

Tee also said several proposed infrastructure and mega projects would be completed by 2020 and that is when the property market should be at its peak as more supply feeds a growing population.

He said there are certain areas property investors can start looking at from this year. He identified three areas which he feels may be worth investing — the city centre for both residential and commercial properties; areas to be developed under the Economic Transformation Programme such as Sungai Buloh and Jalan Imbi; as well as tourism hot spots such as Melaka for commercial properties.

Swhengtee International is a real estate investment networking club with over 200 members.

This article appeared on the Property page, The Edge Financial Daily, April 29, 2011.

Quiet 1Q in the Klang Valley

KUALA LUMPUR: The Klang Valley property market has been quiet in the first quarter of 2011 (1Q11). Though it has picked up, property consultancy PPC International Sdn Bhd does not expect the market to be vibrant in the coming months. 

According to PPC, school and festive holidays in January and February — the New Year, Thaipusam and Chinese New Year — contributed to the slowdown which began at the tail end of 2010.

“However, there have been sporadic new launches of development schemes, residential deals, and retail and commercial transactions,” said PPC managing director Siders Sittampalam.

He added that 2Q would see some improvement over 1Q as there are more transactions of commercial and residential properties this month.

“We do not anticipate a very vibrant market in the following months given the current rise in prices of fuel and essential items and local and international events — such as the impending general election in Malaysia and natural disasters like the earthquake and tsunami in Japan, which may dampen the global economy. 

“As the property market works within the framework of the economy, it is bound to be affected,” Siders said.

Other factors such as the reduction of the loan-to-value ratio to 70% for third-house buyers and the probability of further rises in interest rates could have an impact on the property market.

In its market review for 1Q11, Siders said the residential segment saw some new property launches in Shah Alam, Puchong, Damansara and Kajang with selling prices ranging from RM260,000 to RM5.4 million.

For landed properties, low-density developments were more popular with terraced and semi-detached houses in preferred locations within the Kuala Lumpur city fringes.

“Kajang, Puchong, Klang, Cheras and Sungai Buloh have been the popular locations for new launches,” the report said.

PPC said stratified properties such as condominiums and apartments are well sought after in the secondary market in locations within the Klang Valley as evidenced by the volume of transactions in late 2010.

“House buyers look for unique features and proximity to the city centre with good accessibility via highways,” said Siders.

The report noted that in 1Q, there were not many new launches of high-end residential properties, which could imply that demand for this segment had stabilised.

In the commercial/office sector, the report said that last year there were several new Grade A offices within KL City and its fringes, including Petaling Jaya. They are Hampshire Place, Menara Worldwide and HSBC’s new headquarters which add to the existing 59 million sq ft of office space.

“The asking rents ranged between RM5.50 and RM7.50 psf a month with the occupancy rate from 55% to 70%,” it added.

There are new office buildings due for completion from April 2011 to 2013 within Petaling Jaya, indicating an increasing supply of premises with better facilities. These include Plaza 33 in Section 13 that will have a net lettable area (NLA) of 500,000 sq ft and Point 92 in Damansara Perdana with 158,112 sq ft. Both are scheduled for completion next year.

In the retail sector, there is a rising trend of neighbourhood malls. These medium-sized shopping complexes have emerged largely to cater to residents who prefer to shop close to their homes to avoid traffic congestion and have more time for family-oriented activities.     

Last year, there were new entries of medium-sized malls such as One Mont’Kiara, Empire Shopping Gallery (Subang) and SS Two Mall. Some new shopping malls to be launched this year and in early 2012 are Citta Mall, Ara Damansara and the Festive Mall in Danau Kota, Setapak.


Written by Siti Sakinah Abdul Latif
This article appeared on the Property page, The Edge Financial Daily, April 15, 2011.

Tiara Mutiara Puchong -- Phase 1

Tiara Mutiara sits right in the centre of the triangle of PJ, KL & Puchong. Location-wise, it’s strategic. Federal Highway and Old Klang Road from the North, Putrajaya and Bandar Puchong via LDP & Jalan Puchong from the South, PJ from the West either via PJ Old Town entering into NPE, Old Klang Road or the LDP entering Jalan Puchong, and lastly Cheras from the East via either the East-West Expressway or Kesas Highway. It’s therefore accessible practically from any corner of KL & PJ.

Tiara Mutiara is a 6-acre development of self-contained commercial centre and it’s destined to be the gateway to KL Puchong region. Its total development will consist of – supermarkets, gym, fitness & recreational centres, shops and boutique offices.

It’s therefore an ideal place for lifestyle living and investment opportunities.

Features

~ Full condo facilities;
~ 3-tier security system;
~ Integrated intercom system;
~ Broadband internet facility ready;
~ Covered car park bays;
~ Kitchen Cabinet with Hob & Hood;
~ 2 sets of air-conditioners;
~ 2 sets of water heaters &
~ Tempered glass shower screen (all bathrooms).

It’s free-hold real estates with KL address. Easy ownership scheme with 10%:90% scheme. Zero-cost during construction & free legal fee for SPA.


Call Me now: +6012-408 3523 or email: kh_yklim@yahoo.com   


You may also visit my "iAgent" website: http://limyk.iagent.my/.

The Edge real estate investment forum on 9th April 2011

KUALA LUMPUR: The annual The Edge Investment Forum on Real Estate once again drew overwhelming response, attracting a crowd of about 750 participants this year. The forum was organised exclusively for The Edge Malaysia readers who took time off to attend the half day forum at the Sime Darby Convention Center in Bukit Kiara, Kuala Lumpur, on Saturday, April 9.

This year's forum was themed, “Buy, Sell or Hold?".  It was presented by UOB Malaysia and supported by S P Setia Bhd, the No 1 ranked developer in The Edge Top Property Developers Awards 2010.

The Edge Editor-in-Chief, Dorothy Teoh in her opening remarks said the number of participants at the investment forum continues to grow as property is a 'hot topic' and represent the biggest

investment in one's lifetime for many people.

The first speaker, CB Richard Ellis (M) Sdn Bhd's executive chairman, Christopher Boyd gave some of his views on whether Klang Valley property prices will continue to rise, followed by Ho Chin Soon, director of Ho Chin Soon Research Sdn Bhd who spoke on possible real estate hot spots along the proposed Mass Rapid Transit (MRT) line in Greater Kuala Lumpur.

Reapfield Properties senior vice president Gerard Kho then gave a few pointers about investing in shop offices, focusing on areas to invest in as well as some basic fundamentals to consider before buying.

Participants stayed on after a short coffee break for a panel discussion on the topic 'Build-then-sell: the impact on property prices. In the panel was Bandar Utama developer See Hoy Chan Holdings Group director, Datuk Teo Chiang Kok, UOB Malaysia's managing director and country head of personal finance services, Kevin Lam, and Rehda (Real Estate and Housing Developers Association) Youth member Sam Tan who is also executive director of Ken Holdings Bhd.  One participants who only wants to be known as Kee, an auditor, said he found the forum enlightening and took notes of the presentations throughout the forum.

Another attendee who works as a manager a local bank said it was his first time attending the forum which is into its fifth year.

"I will definitely attend the next one. All the speakers had given so much information about property investment," he said.

Outside the hall, participants took the opportunity to check out the latest products at the booths of UOB Malaysia, S P Setia and Ho Chin Soon Research. Ten participants also took home Ho Chin Soon research maps via a lucky draw.

For the full coverage of The Edge Investment Forum on Real Estate 2011, read the April 18 issue of City & Country, the property pullout of The Edge Malaysia.

Property prices may jump 20%

KUALA LUMPUR: The Real Estate and Housing Developers’ Association (Rehda) Malaysia expects property prices to increase by up to 20% in the next six months on higher material and land costs, its president Datuk Seri Michael Yam said. 

Yam noted that building material cost increased by between 5% and 10% annually. Steel bars, for instance, were priced at RM2,350 to RM2,580 per tonne at the end of last month, an increase of 30% to 40% from RM1,800 at end-2010. The average property price rise this year is expected to be about 13%, he added. 

“The increase will range between 2% and 50%, depending on the location and the development type. With higher property prices, condominiums are a good buy in Kuala Lumpur compared with terraced homes,” he said at a media briefing on 2011’s property outlook yesterday.

The estimates are based on a half-yearly survey by Rehda among its members, comprising housing and property development companies, as at December last year. Some 135 out of 972 members from all states, or 14%, responded.

Yam noted that 58% of the respondents indicated that they have increased their launch prices by an average of 11% (minimum: 5%; maximum: 40%) in the second half of last year, compared with launches in the first half of last year.

He said a majority of the respondents were optimistic of the property market in the coming six months, while they anticipate the number of new launches to rise in the first half of this year. 

According to the survey, launches in the first half of this year in Kuala Lumpur will be mainly apartments/condominiums, terraced houses and serviced apartments. In Selangor, launches for the same period will generally offer terraced houses, semi-detached homes/bungalows, followed by apartments/condominiums.

Both Kuala Lumpur and Selangor are expected to see more commercial property launches from January to June as 26% of the respondents said they will be having commercial property launches. Only 17% of the respondents offered commercial properties in the second half of last year.

Rehda exco member and treasurer Teh Boon Ghee said property prices in Kuala Lumpur will shoot up at least 15% this year due to the higher land cost and land scarcity. He is also head of property development at IGB Corp Bhd, the developer of Mid Valley Megamall and The Gardens Mall in Kuala Lumpur.

In general, properties launched last year were mostly terraced homes, semi-detached/bungalows, condominiums/apartments, serviced apartments as well as townhouses, the survey showed. Properties ranging from RM100,000 to RM500,000 were the most sellable, the survey stated, whilst properties priced between RM250,000 and RM500,000 were the most in demand. The Valuation and Property Services Department under the Finance Ministry had earlier forecast the property sector to contribute 19.6% to the 2010 GDP from 15.5% the previous year.

On the government’s My First Home Scheme announced recently, Yam said Rehda would appeal to the government to have a separate mechanism for properties in Kuala Lumpur and Selangor. 

“There are not many properties priced below RM220,000 in Kuala Lumpur and Selangor, which are the urban centres of population growth and migration. Rehda appeals to the government to review the property price limit to RM350,000, or even RM400,000, for the Klang Valley, as well as increase the household earning cap,” he added. 

In partnership with 25 financial institutions and banks, My First Home Scheme is designed for single adults and households earning no more than RM3,000, intending to purchase houses priced between RM100,000 and RM220,000. 

Yam said many developers may need to review their future developments by building smaller units, where the condition may include higher plot ratio to encourage the construction of more affordable units, and ensure convenient transportation nearby.

This article is written by Racheal Lee & appeared on the Property page, The Edge Financial Daily, March 11, 2011.

http://www.theedgemalaysia.com/property/183192-property-prices-may-jump-20.html

Listings for Rental in Desa Sri Hartamas

                                Along Jalan 23/70A

                                Along Jalan 23/70A

                                From Jalan 26/70A coming out to Jalan 23/70A, passed by Ali Cafe.

                                Jalan 24/70A

                                Jalan 26/70A

                                Jalan 25/70A

                                From Jalan 27/70A coming to Jalan 28/70A.

Desa Sri Hartamas definitely has a ready pool of customers and it's a mature "mini-township" that one can live and work.

Averaged rentals are as follows:

Level	Rental (RM) for Intermediate Lots	Rental (RM) for Endlots
Ground	7,000.00 to 9,000.00	9,000.00 to 16,000.00
1st	2,800.00 to 4,800.00	3,000.00 to 5,500.00
2nd	2,300.00 to 4,000.00	2,500.00 to 3,500.00
3rd	2,000.00 to 3,500.00	2,300.00 to 4,000.00

Others available: 22 x 80 & 22 x 90, endlots as well as intermediate, bare / with renovation.
Available immediately.

Call Lim at +6012-408 3523 or email: kh_yklim@yahoo.com

Readers may also visit my iagent webiste for more listings:  http://limyk.iagent.my/