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New Straits Times
10-05-2025
- Business
- New Straits Times
Property mismatch: Construction up, sales down
KUALA LUMPUR: The fall in property transactions in the first quarter of 2025 (1Q25), despite a spike in construction activity and new launches, indicates a mismatch between actual market demand and developers' projections or ongoing project commitments. Property analysts told Business Times that this may stem from projects that were planned during more optimistic market conditions now coming to fruition, while buyers are growing more cautious amid economic uncertainties, stricter lending conditions, and affordability challenges. According to the Valuation and Property Services Department, the country's property market slipped in Q1, with transaction volume down 6.2 per cent and value down 8.9 per cent. Its director general Abdul Razak Yusak said the total transactions amounted to 97,772, valued at RM51.42 billion, compared to 104,194 transactions worth RM56.47 billion in the same period of 2024. Abdul Razak said although the property transactions began on a slower note, the pace of construction activity and increase of residential new launches were supported to balance the property market growth and sustain its positive momentum in 2025. Universiti Teknologi Malaysia associate professor in property economics Dr Muhammad Najib Razali said Malaysia has long faced an imbalance between supply and demand, especially in the affordable housing segment. "To address this, developers must strengthen their market analysis and ensure new launches are aligned with real, localised demand, not just general market trends, to avoid oversupply in the wrong segments," he said. Juwai IQI co-founder and group chief executive officer Kashif Ansari said while it may appear contradictory to see a drop in transactions alongside a surge in construction, it is actually a reflection of two separate timelines. "Much of the construction we are seeing now was planned and financed months or years ago. Developers are betting on the future, not just the moment. "The strong results in 2024 gave them even more confidence. The value of construction work done surged 20 per cent last year to RM158.8 billion, with residential building growing nearly 40 per cent," he added. Kashif said while fewer people and companies bought any kind of real estate in the first quarter, that hides the fact that some segments actually improved. "Residential made up 61 per cent of all transactions, demonstrating sustained demand. And look at terraced homes, where prices climbed by 2.2 per cent in a single quarter," he added. Temporary Slowdown Najib said although the first quarter reflects a slowdown, it is too early to conclude that this signals a long-term trend. He said Malaysia's property market has historically been cyclical, and seasonal or short-term factors (such as timing of launches, interest rate expectations, or political developments) can influence quarterly numbers. "However, if economic uncertainties persist or consumer confidence weakens, we could see the softer trend continue through the mid-year, though pockets of resilience might remain, especially in affordable housing or niche market segments," he added. Meanwhile, Kashif said the first-quarter slowdown appears to be a temporary pause, pointing out that the beginning of the year is typically quieter and that global uncertainties likely caused some buyers to hold back. "But Malaysia has solid fundamentals, like stable interest rates and steady job growth, and I expect momentum to return in the second quarter and third quarter. "The number of transactions will increase because buyers who held back out of worries about the global situation will go ahead with their purchases. "One thing that gives me confidence is the rise in new launches. Developers do not commit unless they believe demand will follow," he added. Kashif said sales activity typically rebounds within a quarter or two, and if sentiment remains stable, many of the delays seen in the first quarter could translate into transactions in the second half of the year.
New Straits Times
10-05-2025
- Business
- New Straits Times
Property mismatch: Construction up, sale down
KUALA LUMPUR: The fall in property transactions in the first quarter of 2025 (1Q25), despite a spike in construction activity and new launches, indicates a mismatch between actual market demand and developers' projections or ongoing project commitments. Property analysts told Business Times that this may stem from projects that were planned during more optimistic market conditions now coming to fruition, while buyers are growing more cautious amid economic uncertainties, stricter lending conditions, and affordability challenges. According to the Valuation and Property Services Department, the country's property market slipped in Q1, with transaction volume down 6.2 per cent and value down 8.9 per cent. Its director general Abdul Razak Yusak said the total transactions amounted to 97,772, valued at RM51.42 billion, compared to 104,194 transactions worth RM56.47 billion in the same period of 2024. Abdul Razak said although the property transactions began on a slower note, the pace of construction activity and increase of residential new launches were supported to balance the property market growth and sustain its positive momentum in 2025. Universiti Teknologi Malaysia associate professor in property economics Dr Muhammad Najib Razali said Malaysia has long faced an imbalance between supply and demand, especially in the affordable housing segment. "To address this, developers must strengthen their market analysis and ensure new launches are aligned with real, localised demand, not just general market trends, to avoid oversupply in the wrong segments," he said. Juwai IQI co-founder and group chief executive officer Kashif Ansari said while it may appear contradictory to see a drop in transactions alongside a surge in construction, it is actually a reflection of two separate timelines. "Much of the construction we are seeing now was planned and financed months or years ago. Developers are betting on the future, not just the moment. "The strong results in 2024 gave them even more confidence. The value of construction work done surged 20 per cent last year to RM158.8 billion, with residential building growing nearly 40 per cent," he added. Kashif said while fewer people and companies bought any kind of real estate in the first quarter, that hides the fact that some segments actually improved. "Residential made up 61 per cent of all transactions, demonstrating sustained demand. And look at terraced homes, where prices climbed by 2.2 per cent in a single quarter," he added. Temporary Slowdown Najib said although the first quarter reflects a slowdown, it is too early to conclude that this signals a long-term trend. He said Malaysia's property market has historically been cyclical, and seasonal or short-term factors (such as timing of launches, interest rate expectations, or political developments) can influence quarterly numbers. "However, if economic uncertainties persist or consumer confidence weakens, we could see the softer trend continue through the mid-year, though pockets of resilience might remain, especially in affordable housing or niche market segments," he added. Meanwhile, Kashif said the first-quarter slowdown appears to be a temporary pause, pointing out that the beginning of the year is typically quieter and that global uncertainties likely caused some buyers to hold back. "But Malaysia has solid fundamentals, like stable interest rates and steady job growth, and I expect momentum to return in the second quarter and third quarter. "The number of transactions will increase because buyers who held back out of worries about the global situation will go ahead with their purchases. "One thing that gives me confidence is the rise in new launches. Developers do not commit unless they believe demand will follow," he added. Kashif said sales activity typically rebounds within a quarter or two, and if sentiment remains stable, many of the delays seen in the first quarter could translate into transactions in the second half of the year.
The Star
09-05-2025
- Business
- The Star
Residential construction activity rises in 1Q25 with surge in completions, housing starts
KUALA LUMPUR: Construction activity in the residential property subsector recorded significant growth in the first quarter of 2025 (1Q 2025) where the number of completed units surged by 30.2 per cent to 9,329 units from 7,168 units in 1Q 2024. According to director general of valuation and property services, Valuation and Property Services Department (JPPH), Abdul Razak Yusak, housing starts also rose by 32.5 per cent to 28,344 units in 1Q 2025 from 21,391 units in 1Q 2024, indicating a strengthening development trajectory for the residential subsector. However, planned new development is seen decreasing to 8,300 units in 1Q 2025 compared to 11,000 units in 1Q 2024, he said during the launch of the Property Market First Quarter 2025 report via Facebook live under JPPH. Meanwhile, he said there is encouraging performance of residential new launches which surged more than double to 12,498 units in 1Q 2025 from 5,585 units in the same period of 2024 with sales performance recorded at 10.8 per cent. He noted that property transaction performance experienced a slight decline, with the volume and value of transactions decreasing by 6.2 per cent and 8.9 per cent to 97,772 transactions valued at RM51.42 billion, compared to 104,194 transactions worth RM56.47 billion in the same period of 2024. Abdul Razak said although the property transactions began on a slower note, the robust pace of construction activity and the increase of residential new launches were supported to balance the property market growth and sustain its positive momentum in 2025. "The continuous government support through initiatives such as the Program Residensi Rakyat (PRR), Projek Rumah Mesra Rakyat (RMR), and strategic infrastructure development have been a key driver in accelerating construction activity. "Government-led initiatives aimed at strengthening Malaysia's position in the global investment prospects, such as the Forest City Special Financial Zone, the Johor-Singapore Special Economic Zone (JS-SEZ), and the implementation of a duty-free zone in Pulau Satu, Forest City have started to demonstrate significant impact,' he said. Abdul Razak said the performance of residential overhang recorded a total of 23,515 units valued at RM15 billion, reflecting a marginal increase of 1.6 per cent and 7.7 per cent in volume and value from 23,149 units worth RM13.94 billion in Q4 2024. In addition, the occupancy performance for shopping complexes recorded a marginal increase, with the occupancy rate rising to 79 per cent compared to 78.8 per cent in 1Q 2024. The Malaysian House Price Index (MHPI) in the first quarter 2025 stood at 225.3 points (an average price of RM486,070 per unit), with an annual growth rate of 0.9 per cent, he said. Abdul Razak said the growth of the property market is expected to remain resilient driven by positive momentum in the construction sector and a continued rise in newly launched residential units. "Special financial and infrastructure incentives under the JS-SEZ, the Special Financial Zone in Forest City Johor, and ongoing infrastructure development are expected to further stimulate long-term growth in the property market,' he added. - Bernama
New Straits Times
09-05-2025
- Business
- New Straits Times
Property transactions down 6pct in Q1, value drops 9pct
KUALA LUMPUR: Malaysia's property market slipped in the first quarter of 2025, with transaction volume down 6.2 per cent and value down 8.9 per cent, according to the Valuation and Property Services Department (JPPH). Its director general, Abdul Razak Yusak said the total transactions amounted to 97,772, valued at RM51.42 billion, compared to 104,194 transactions worth RM56.47 billion in the same period of 2024. He said although the property transactions began on a slower note, the pace of construction activity and the increase of residential new launches were supported to balance the property market growth and sustain its positive momentum in 2025. "Construction activity in the first quarter of 2025 showed significant growth, with the number of completed residential units rising by 30.2 per cent to 9,329 compared to the first quarter of 2024. "The number of projects that started construction also increased by 32.5 per cent, reaching 28,344 units from 21,391 the previous year," he said during a presentation on the property market broadcast on Facebook today. The number of new residential launches more than doubled to 12,498 units, up from 5,585 units in the same period of 2024, with a sales performance of 10.8 per cent. Abdul Razak said this encouraging growth indicates a strengthening development trajectory for the residential subsector. Meanwhile, the Malaysian House Price Index in 1Q25 stood at 225.3 points, with an average house price of RM486,070 per unit, reflecting an annual growth rate of 0.9 per cent. "All states witnessed moderate positive growth ranging from 0.3 per cent to 6.9 per cent, except for Sabah and Sarawak, which remained stable, while Kuala Lumpur declined by 2.4 per cent," Abdul Razak said. Commenting on the outlook, he said the property market is expected to maintain its resilience, fueled by strong momentum in the construction sector and a continued increase in newly launched residential units. "Although the property market maintains a positive outlook, industry players and property developers are urged to remain attentive to market dynamics, global economic challenges, and an uncertain external environment. "Special financial and infrastructure incentives under the Johor-Singapore Special Economic Zone, the Special Financial Zone in Forest City, Johor, and ongoing infrastructure development are expected to further stimulate long-term growth in the property market," Abdul Razak said.
Daily Express
09-05-2025
- Business
- Daily Express
Property transactions drop 8.9% to RM51.42 billion in Q1 2025
Published on: Friday, May 09, 2025 Published on: Fri, May 09, 2025 By: Tan Chin Tung, FMT Text Size: The Malaysian house price index rose marginally by 0.9% to 225.3 points, with house prices averaging RM486,070 per unit. PETALING JAYA: The Malaysian property market saw a 6.2% decline in transactions in the first quarter of the year, with 97,772 deals recorded, valued at RM51.42 billion – down from 104,297 transactions worth RM56.53 billion in Q1 2024. Valuation and property services department director-general Abdul Razak Yusak said that in terms of volume, the residential sub-sector continued to dominate market activities with over 59,000 transactions, valued at over RM24 billion. The industry sub-sector grew by 0.3% compared to Q1 2024, while the agriculture and commercial subsectors dropped by 10.6% and 5.4%, respectively. However, Razak said construction activities grew positively in Q1 2025, with 28,344 properties beginning construction, up from 21,391 in the same period last year. Construction activities for the serviced apartment segment saw a 100% spike, rising from 5,458 in Q1 2024 to 14,761 in Q1 2025. New residential launches also increased by over 100% to 12,498 units from 5,585 in Q1 2024. The Malaysian house price index rose marginally by 0.9% to 225.3 points, with house prices averaging RM486,070 per unit. 'All states recorded a moderate increase in house prices of between 0.3% and 6.9%, except for Sabah, Sarawak and Kuala Lumpur, where prices dropped 2.4%,' Razak said when unveiling the Q1 2025 Real Estate Market Report today. Completed unsold housing, commonly known as residential overhang, increased to 23,515 units valued at RM15 billion from 23,149 units worth RM13.94 billion in the fourth quarter of 2024. Serviced apartment overhang dropped by 6.7% to 18,246 units, with a 6.9% decrease in ringgit value to RM14.61 billion. Razak said government initiatives such as the introduction of the Forest City special financial zone in Johor, the Johor-Singapore special economic zone, and Pulau Satu as a duty-free island had boosted the serviced apartment market in the state. 'The overhang rate for serviced apartments in Johor dropped to 5.6% in the first quarter of 2025 compared to the fourth quarter of 2024,' he said.
