PETALING JAYA (Nov 28): The conversion rate for sales in the primary market has gone to over 63% in 2017 from 50% in 2016, said the Malaysian Institute of Estate Agents (MIEA) secretary-general Chan Ai Cheng.
Citing recently launched projects such as UEM Sunrise Bhd’s Solaris Parq, Sime Darby Property Bhd’s Lot 15, Razak Residence by Akisama Group and Southbrooks by Perdana ParkCity Sdn Bhd as examples, Chan said these projects have experienced “decent and good” take-up rates.
“Based on our survey among members who focus on project marketing, there is better conversion rate this year compared with 2016 since the tightening on loans.
“2016’s conversion rate was in the region of 50% and in 2017, the rate has improved to between 63% and 70%, which is a healthy improvement.
“This could be because buyers are more aware of the stringent requirements by the banks and had time to work on improving their ‘loan-ability’ status, as well as be better prepared to own properties now knowing the cash requirements to purchase properties,” she said at a press conference held by MIEA today.
Chan added that homebuyers are now more sophisticated as they do a lot of comparing before purchasing a property and as a result, MIEA’s real estate negotiators have to undergo more training in 2017 in order to move forward.
“Also, we think making units smaller and expecting them to sell better needs to be relooked by property developers.
“When it comes to real estate project marketing, you need to look at the right location, right product — you don’t sell a commercial property in an area with demand for residential properties instead — with the right pricing, right packaging and developer’s reputation.
“For products to be sellable, these criteria have to be there. What the market needs and wants — what is right. To determine what is right, proper research backed up by data which includes surveys is very much necessary,” she added.
Meanwhile, MIEA vice-president Kelvin Yip noted that the volume and value of residential property transactions in selected states such as Penang, Johor, Selangor and Kuala Lumpur recorded declines, except for KL, where its residential property transacted value increased by 12.7% in 1H17.
“Despite the decrease in volume and value, the average value per transaction [for these states] increased except for Johor, where its average value per transaction is at RM335,374 or dipped slightly by 2% in 1H17,” he said, citing data from the National Property Information Centre.
On non-landed homes, condominiums or apartments between the price range of RM250,001 to RM500,000 and RM500,001 to RM1 million were the most transacted categories for 1H17.
“Meanwhile, the popular category in Selangor was between RM250,001 to RM500,000. In KL, non-landed homes between the price range of RM250,001 to RM500,000 and RM500,001 to RM1 million were equally popular,” said Yip.
Yip expects the property market to remain lacklustre going into 1Q18, given the lack of incentives and measures in Budget 2018 to spur the property segment.
“Moving forward, the recent rebound in the economy, coupled with the strengthening of the local currency and a stable employment market, among other positive developments, offered a ray of hope for recovery in the residential market,” he said.