Wednesday, 22 August 2012


More Chinese cities record new home price increases

 | August 22, 2012 0 Comments
New home prices in more Chinese cities rose in July than in the previous month, the government said Saturday, amid cautious optimism the country’s property market may be bottoming out.
Prices in 50 out of the 70 Chinese cities tracked by the government increased in July from June, the National Bureau of Statistics said in a statement.
That represented a doubling from 25 in June.China has been taking steps to tighten its housing market for more than two years.
Measures have included prohibitions on buying second homes, raising minimum down-payments and imposing property taxes in certain areas.
The government, however, has also recently taken steps to boost the country’s slowing economy by cutting interest rates twice in quick succession and encouraging lending by reducing reserve requirements at banks.
Cutting interest rates reduces the cost of taking out a mortgage and can stimulate buying.Prices of new homes in another 11 cities were unchanged in July compared with 24 in June, statistics bureau said.
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Plans not in accordance with Town and Country Planning Act

 | August 22, 2012 0 Comments
BUKIT Antarabangsa resident Dr Mohamed Rafick Khan Abdul Rahman is against the proposed Sungai Besi-Ulu Kelang Expressway (SUKE) as he says plans were not drawn in accordance with the Town and Country Planning Act 1976.
He added that procedures were not followed, including getting feedback in a set period of time followed by a public hearing.
“It is very clear they did not follow specifications in the Act. The highway isn’t even included in the Ampang Jaya Municipal Council masterplan but we were told the Selangor Economic Action Council (MTES) has approved it.
“The purpose of building this highway is to reduce the congestion on the Middle Ring Road 2 (MRR2) and this can only be achieved if they correct the malalignment of the exit and entry routes. Right now the problem lies near the Flamingo Hotel near Jalan Ampang.
“The Public Works Department spent RM20mil near Pandan Indah and the situation there has changed. Instead of building a highway, they can opt to build an elevated route or even a tunnel.
“We cannot keep building more highways simply because these are supposed to improve the public transportation system,” he said.

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Predictions of housing collapse in Australia get old

 | August 22, 2012 0 Comments
SYDNEY: Argument over whether Australian housing is in a bubble has dragged on for over a decade.
A Google search on the subject draws 600,000 returns. It even has its own Wikipedia page.
Three years after the global financial crisis hammered prices in the United States and Britain, Australian home values are just 5% below their lifetime highs. Recently, prices have begun to tick up again thanks to lower interest rates and a sound banking system still able and willing to lend.
Yet mortgage arrears are negligible, household debt has stabilised, savings are up sharply and unemployment is low, suggesting the housing market represents a modest threat to the economy.
The head of the country’s central bank certainly wonders what all the fuss is about.
“It has to be said that the housing market bubble, if that’s what it is, seems to be taking quite a long time to pop if that’s what it is going to do,” observed Reserve Bank of Australia (RBA) governor Glenn Stevens.
“The ingredients we would look for as signalling an imminent crash seem, if anything, less in evidence now than five years ago.”
And the RBA is no defender of rising home prices. As long ago as 1995 the then governor Ian Macfarlane was preaching that ever higher home costs was a social ill that made some people better off “at the expense of their children.”
In 2002 and 2003 the bank ran a verbal campaign against an overheating housing market that played a big part in restraining prices for a couple of years.
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Iskandar Malaysia: Developers face tougher times with global uncertainties and price hikes

 | August 22, 2012 0 Comments
JOHOR BARU: Property developers in Johor must be ready to face tougher times within the next six to 12 months in view of the uncertainties in the global economic growth.
Johor Real Estate and Housing Developers Association (Rehda) branch chairman Koh Moo Hing said they should be optimistically cautious as the outlook was not expected to be rosy.
“Hopefully, our members are well prepared to brace the hard times and avoid from being overly ambitious,” he told StarBiz.
Koh said property price in Johor, especially in Iskandar Malaysia, would also be increased by at least 5% in months to come as the hike was unavoidable.
He said with the prices of building materials, especially cement, likely to go up and shortage of workers, developers would have not much choice but to pass the cost to consumers.
Koh advised developers to carefully plan when launching a project this year and next and go for products that could still sell in an unfavourable property market.
“Although there will be a hike in prices of properties in Iskandar Malaysia, it is still not as high as those in the Klang Valley and Penang,” he said, adding that developers could expect demand for properties in Iskandar Malaysia to remain “positive” especially from time house buyers and upgraders.
He said they would not want to delay their purchase as many of them had anticipated that prices of residential properties would continue to increase.
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Saturday, 11 August 2012


Are developers really making too much?

 | August 12, 2012 0 Comments
LATELY, there have been many ongoing discussions on the topic of high property prices. It made me ponder on the various causes that might have contributed to the situation, including the question of whether developers are making too much.
As I took a sip of tea, many thoughts came to mind which I found interesting and worth sharing before we dwell further into the real factors of rising property prices.
Based on annual reports (see chart) of three major property developers in Malaysia, namely SP Setia, UEM Land Holdings and Mah Sing Group, they are generating an average of 18% profit margin from their projects, and at the same time incurring a staff cost of about 7% of their total revenue.
These companies are major developers in mass residential properties which have high sales turnover, and therefore a good reflection of the average developers’ profit margin in the residential market.
These findings may contrast with people’s perception of the profitability of the property development industry.
Though it may sound like a fantasy, assuming I could convince these three property developers to give back their entire profit to their customers, it would mean an average of 18% discount on property prices for the year in question.
This would seem like a fantastic bonanza for the buyers of the properties in question. But would a 18% discount really make these properties affordable? I would imagine that people will still find these properties expensive.
Let’s take an example of a terrace house that costs RM700,000 in Petaling Jaya......
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Developing RRI land

 | August 12, 2012 0 Comments
AS a person who was born and spent his childhood years in the Rubber Research Institute of Malaysia (RRI), Sungei Buloh, it is with some nostalgia that I read about plans to develop the area.
That piece of land now straddling a bustling area near Kota Damansara, Subang Airport and the rapidly developing area of Subang, houses the RRI’s research facilities and rubber estates.
For those who lived there a long time ago, it was a tranquil and idyllic area with swimming and paddling in the streams, sports of all sorts in the evenings, hunting, biking and excursions into the jungle nearby. Tigers were said to have been sighted and someone even shot a leopard once.
But the area around it is virtually unrecognisable now and the RRI land stands like an oasis in a desert of poorly planned development. But it will fall to development too as the land has been sold, reported for RM2bil to the Employees Provident Fund (EPF). RRI will get to retain 216ha for its research facilities.
EPF’s wholly-owned subsidiary Kwasa Land Sdn Bhd will undertake a master plan of the entire area, the area for development will be split up into smaller parcels and the private sector will be invited to tender for their development.
There are plans to have an MRT station too in the area and the whole development is expected to take 10 to 15 years.
No doubt, EPF was chosen by the Government to get the RRI land because it is a provident fund whose members comprise most of the workers in the country and it would therefore be seen as a more neutral and independent party to develop the land.
It is necessary that it gets expertise to both produce the master plan as well as to see how it can maximise the value of the land for itself.
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SP Setia launches luxury condos at JB, price range from RM 300,000

 | August 12, 2012 0 Comments
JOHOR BAHARU: S P Setia Bhd has launched the “Sky Oasis Residences” luxury condominium project with gross development value of RM180mil.
Setia City Development Sdn Bhd general manager Ricky Yeo said 60% of the international units have been snapped up although the project was recently launched and slated for completion in 2015,
Project developer, Setia City Development, is a unit of S P Setia.
“With the price range from RM300,000 onwards, it’s reasonable to people who aspire for modern living under the “Urban Lakeside Living In The Skies” concept,” he told Bernama.
Sky Oasis Residences is at the Setia Indah housing estate, also developed by S P Setia.
More details on Sky Oasis Residences:

A question of demand and supply for Tun Razak Exchange

 | August 12, 2012 0 Comments
A BIG pipeline of commercial properties in and around the city centre itching to be launched over the next decade or so is stoking concerns by the day – will there be sufficient demand for all these buildings?
1Malaysia Development Bhd, the master developer of the massive RM26bil Tun Razak Exchange development is fully aware of such concerns.
Close to half of the TRX real estate project will comprise office buildings. The project comes along at a time when many other mammoth commercial projects such as the re-development of 926ha Rubber Research Institute (RRI) Malaysia land in Sungai Buloh and Permodalan Nasional Bhd’s proposed 100-storey Menara Warisan Merdeka are poised to take off.
Naturally, the question of oversupply is posed to the government agency.
“The easy answer to such concerns is… that our interest is aligned towards making sure that there is not going to be an oversupply,” says 1MDB chief executive officer Datuk Shahrol Halmi.
“As a government agency, 1MDB is cognisant of the impression that… look, we are the Government, a 800-pound gorilla, therefore we can squeeze people (private developers) out,” he says, referring to the fact that the agency is spearheading such a big project in one of the city centre’s prime areas.
“But I ask you… is it the Government’s job to go and regulate the area of square footage that is available in the market – is that a good idea?
Is it then fair to say if there is better quality that is available on a certain side then that would be our chosen place?” he asks.
“The reality is that it is not the Government’s interest to destroy the economy of the city,” Shahrol says.
How then do we address concerns of oversupply?
“Via market researches, do studies on commercial property demand, moving forward – let market economics dictate,” he says.
Cause for Concern?
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How TRX can be a reality ? shared by CEO, Datuk Shahrol Halmi

 | August 12, 2012 0 Comments
1MDB has landed itself with the RM26bil Tun Razak Exchange. Its task is to ensure this mammoth project takes off and it becomes a major catalyst of growth for the future. StarBizWeek‘s B.K. Sidhu and Yvonne Tanmet up with its CEO, Datuk Shahrol Halmi, who shared some of his thoughts on how TRX can be a reality. Here are excerpts of the interview:


SBW: Why the name TRX from KLIFD?
Over the years, we got feedback that KLIFD is bit of a mouthful to pronounce and hard to remember, so we thought it’ll be good to go and find a good memorable name for the district. TRX came about because it’s on Jalan Tun Razak and we are just taking the cue from Wall Street, which is named after an actual street.
What’s the role of the Government in TRX and why must the Government be driving it?
Because the Government is driving the ETP and who else is better to catalyse this than the Government?
The Government is going to start the ball rolling by doing up the master plan and setting standards. The developers will be invited to participate.
What if there are no “A” grade tenants for TRX? 

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Tun Razak Exchange – Next generation development concept

 | August 12, 2012 0 Comments
1MDB will spare no effort in building the state-of-the-art Tun Razak Exchange.
UNLIKE other ground-breaking ceremonies where VIPs often sweat it out in the blazing sun with a shovel in their hand to mark the occasion, the one for Kuala Lumpur’s newest and arguably swankiest financial district was done in style and comfort.
In one late July afternoon near Jalan Tun Razak, the VVIP who got the project officially off was Prime Minister Datuk Seri Najib Tun Razak. What he did was just touch a LED sphere that rose right before him in a makeshift air-conditioned hall and within seconds, images of a huge excavator loading gravel onto a lorry appeared on two large screens. That was it. No heat, no sweat, just a simple ceremony to mark the momentous occasion, and powered by technology.
And it will be smart technology, a digital backbone, eco-friendly elements and a garden city that will be the hallmarks of a futuristic city for modern living and working. When the cement and paint dries, the Tun Razak Exchange (TRX) will mould and alter the increasingly towering skyline of Kuala Lumpur.
Named after the prime minister’s father (Tun Razak), TRX will house 26 buildings over a 70-acre site on the fringes of the Kuala Lumpur city centre. It is designed to house hundreds of multinational companies, financial institutions, government agencies, hotels and support services. The project has an eye-popping gross development value of RM26bil.
Though a lot of planning has gone into the design of the new district, the question is will it be enough to thrust KL into one of the top 20 livable cities in the world? Will it be a financial hub that can attract the big deals and talent that seems to gravitate to Singapore and Hong Kong? Would its emergence create a glut in the real estate sector?
And what will it take to turn this whole dream into reality?
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Thursday, 2 August 2012


MRT Corp not acquiring properties in Pinggir Zaaba after all

 | August 2, 2012 0 Comments


MASS Rapid Transit Corporation (MRT Corp) has confirmed that it will not acquire the 25 houses in Pinggir Zaaba, Taman Tun Dr Ismail in Kuala Lumpur.
MRT Corp strategic communications and public relations director Amir Mahmood Razak said its special compensation committee had rejected the acquisition plan on grounds that there was no legal requirement to do so.
“We had focused our attention on the 25 houses, which were closest to the alignment since September last year. The original request was for them to be relocated. After speaking to the houseowners, they were interested in the compensation plan.
“We submitted the papers to the special compensation committee two weeks after conducting property evaluation. The committee rejected it, as it will cause unnecessary precedence in the future,” said Amir during a media briefing at the MRT Information Centre in Taman Tun Dr Ismail yesterday.
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Bungalow-like semi-dee

Safety and convenience were two important criteria that prompted property owner Anwar Jumabhoy to move to Duta Nusantara in Sri Hartamas six years ago with his wife and four children.
“We lived in Bukit Damansara and were in the process of rebuilding a new house on our property,” said Anwar, who is the director of operations for Tune Hotels.
“We wanted to have a ready-built house with some facilities. A gated property, we thought, would be very safe and convenient.”
Located down the road from Plaza Damas in Sri Hartamas, Duta Nusantara is right across from the new Home Affairs Ministry Kuala Lumpur Federal Territory (KL FT) Complex on Jalan Duta. The complex also houses the KL FT Immigration office.
Extensive renovations 
This freehold, gated and guarded development was built on a site of 14ha (34.5 acres). It comprises 42 detached houses and 136 semi-detached houses designed by a local architect. The homes feature a tropical theme characterised by terraces, mini-courtyards (void areas), patios and skylights. However, many property owners have embarked on extensive renovations to cover up the exposed areas to ensure greater privacy, security and more usable space.
Anwar and his family live in a double-storey, semi-detached unit with 390sq m (4,200sq ft) of built-up space on a 418sq m (4,500sq ft) plot.
“Most parts of the house have been renovated,” pointed out Anwar, who is in his 50s, “Starting with the outside space. We tiled and covered the back porch, added a pergola and koi pond at the side of the house, outside the dining room.”
The ground floor comprises a guest bedroom, living room, dining room, piano area as well as a dry kitchen, a separate wet kitchen and a room for the maids. The first floor includes a television lounge, study area, master bedroom and three secondary bedrooms. In total, there are four bedrooms on the first floor and one on ground floor.

Spacious 
The spacious car porch can accommodate a total of four cars and can double up as party space during festivals like Hari Raya Puasa when the family entertain friends and relatives.
“We expanded the maids’ room. Most significantly, we removed the void area, installed a glass roof and expanded the floor space on the upper floor, which is now the study area. The houses were sold as a bare shell, so we put in all the built-in cabinets, lighting fixtures, electrical appliances and so on.”
Added Anwar: “With the renovations, although a semi-detached unit, the house feels like a bungalow.”
The monthly maintenance cost for a property like this in Duta Nusantara is RM880, inclusive of sinking fund contribution.
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Wednesday, 1 August 2012

Najib announces task force to oversee Tun Razak Exchange


The development of the Tun Razak Exchange (TRE), previously known as the Kuala Lumpur International Financial District, will be managed by a special task force until it is fully operational, according to Prime Minister Datuk Seri Najib Tun Razak.
The task force will be helmed by the Economic Planning Unit in the Prime Minister’s Department and chaired by Tan Sri Nor Mohamed Yakcop, Minister in the Prime Minister’s Department. Its members will comprise senior officers from the Securities Commission, Bank Negara, Finance Ministry and other related agencies.
In a report by Bernama, Najib said the task force will ensure that the TRE gets the support of the entire government machinery – from planning, implementation, and until it is fully up and running.

Malaysia commercial property market to remain timid: RICS


Malaysia’s commercial property market will likely continue to have a downward tone, according to the RICS Global Commercial Property Survey Q2 2012.
The survey highlighted that further increases in supply plus the weakening tenant demand show a negative outlook for the occupier market. Rental expectations across industrial, retail and office sectors dropped with an all property net balance of -28. Also, the decline in investor market is expected to put capital values lower over the next quarter.
On the other hand, commercial property market in Hong Kong and China continue to perform well despite the slump felt by other key Asian countries.
Both markets were less affected by the unstable global market. Demand for both occupier and available space in China continued to grow, resulting to rising rental expectations and a net balance of +25.

Decision on M’sia-S’pore rail project to be made in 2013


The final decision on the upcoming Malaysia-Singapore Rapid Transit System (RTS) link project connecting Johor Bahru to the city-state will be made next year, according to a report by The Star.
At present, Malaysia and Singapore are undertaking the joint-engineering study for the project, said Datuk Ismail Ibrahim, CEO of Iskandar Regional Development Authority (IRDA)
The study looked into various factors that will affect the project such as multimodal terminal locations, CIQ matters (customs, immigration, and quarantine), alignments and other critical perimeters.
“Once it is completed, both governments will make a decision on the preferred alignments.”
He revealed that there are two options for the RTS project linking Singapore and Johor Bahru – the trains could either run above ground or through undersea tunnel. Should the undersea tunnel be chosen, the parties will have to decide whether it will be a bore tunnel or a sunken tunnel.