This article first appeared in City & Country, The Edge Malaysia Weekly on April 17, 2023 - April 23, 2023

In 2022, the Sabah property market saw a rebound as the nation moved from the pandemic stage to the endemic phase, according to Rahim & Co regional manager (Sabah) Max Sylver Sintia in presenting the Kota Kinabalu Housing Property Monitor 4Q2022.

Max says that in 2022, the residential property market achieved a total of 5,792 transactions worth RM2.778 billion. Compared to 2021, this was an increase of 20.54% in volume and 17.3% in value. Compared with 2019, the increases were 7.8% and 9.37% respectively.

“This by no means signifies a full recovery, but a resumption of the rebound trend that started in 2018/19 but was severely interrupted during the pandemic and lockdown in 2020/21.

“With the reopening of the economy and international borders, demand for properties was reinvigorated as crowds returned to physical spaces and activities, thus reviving some degree of confidence in the market,” says Max.

Despite these encouraging numbers, he highlights that transaction volume and value recorded in 4Q2022 were lower than in 4Q2021. “The state registered 1,319 residential transactions worth RM512.04 million in 4Q2022 — a year-on-year (y-o-y) decrease of 3.09% in volume and 8.83% in value.”

Max says, in the quarter under review, properties priced below RM300,000 were the most transacted in the Sabah market, with 642 transactions worth RM121.35 million, or 48.67% and 23.70% of the quarter’s total volume and value respectively. This was followed by residential property in the price brackets of RM300,001 to RM500,000, with 385 transactions (29.19%) worth RM150.42 million (29.38%); RM500,001 to RM1 million, with 240 transactions (18.20%) worth RM162.55 million (31.74%); and above RM1 million, with 52 transactions (3.94%) worth RM77.73 million (15.18%).

The Kota Kinabalu, Penampang and Putatan conurbation makes up the bulk of the residential transitions in Sabah, with 702 transactions worth RM333.56 million (53.2% and 65.14% of the quarter’s total volume and value respectively) in the quarter under review. He points out, however, that, compared to 4Q2021, residential property transactions in Kota Kinabalu, Penampang and Putatan decreased by 3.17% and 8.63% of the quarter’s total volume and value respectively.

Max highlights some notable residential developments launched in 4Q2022. Taman Flamingo Phase 4 by Menggatal North Development Sdn Bhd in Menggatal, Kota Kinabalu, is one.

“The development consists of 32 two-storey terraced houses. The intermediate units with a minimum land area of 1,616 sq ft are being sold from RM593,750 to RM625,000. The corner units, [whose land area ranges from 2,693 sq ft to 3,823 sq ft] are 

being sold from RM690,650 to RM769,000,” he says.

In Putatan, Kota Kinabalu, a boutique development of only 15 two-storey terraced houses known as Taman Sri Tombovo has a starting price of RM688,000. “Developed by Seratim Development and located in Ketiau, the [house] has a minimum land area of 1,347 sq ft,” Max says.

On a side note, he says industrial and commercial properties performed well in 4Q2022, with “transaction volume and value for Sabah industrial properties registering y-o-y growth of 37.68% and 0.29% respectively. The commercial properties saw transaction volume and value grow 35.71% and 8.28% respectively”.

“A notable transaction recorded in 4Q2022 was the purchase of five parcels totalling 12,949.74 sq ft in Jalan Gaya for RM50 million in October 2022 by Nosmal Hospitality Sdn Bhd and Nosmal Properties Sdn Bhd,” says Max.

He believes a cautious outlook is being adopted for the market. “Despite the improvement in transaction numbers and economic indicators, sentiment among developers, investors and homebuyers remained cautious because of anticipated concerns, which include inflationary pressure, though it is expected to gradually ease; tight monetary policy; disrupted global supply chains; rising construction costs; and rising cost of living — which persist in subduing expectations,” says Max.

“The two-storey terraced houses in the monitor recorded an average price growth of 2.14% y-o-y in 4Q2022,” says Max.

He notes the highest y-o-y price growth was recorded at Ujana Kingfisher, which saw an increase of 3.28% to RM630,000. This was followed by Taman Sri Borneo (up 2.99% to RM690,000), Taman Jindo (up 2.94% to RM700,000), Luyang Perdana (up 2.63% to RM780.000), Golden Hill Garden (up 2.33% to RM880,000) and Millennium Height (up 0.79% to RM635,000). Taman Indah Permai house values remained unchanged.

“Quarter on quarter (q-o-q), there was a slight price growth for houses in Luyang Perdana, which increased by 1.3%, followed by Ujana Kingfisher (0.8%), Millennium Height (0.79%), Taman Sri Borneo (0.73%), Taman Jindo (0.72%) and Golden Hill Garden (0.57%). No q-o-q growth was registered in Taman Indah Permai,” says Max.

Rental rates in Luyang Perdana improved by 4.55% y-o-y to RM2,300 per month. Ujana Kingfisher recorded rental growth of 2.86% y-o-y to RM1,800 per month, Taman Sri Borneo rose 2.63% to RM1,950 per month, Taman Jindo rose 2.38% to RM2,150 per month and Golden Hill Garden increased 1.92% to RM2,650 per month. No rental growth was noted in Taman Indah Permai and Millennium Height, with rents remaining at RM1,500 and RM2,000 per month respectively. No q-o-q growth was recorded for all two-storey terraced house samples.

The average gross yield for two-storey terraced houses was 3.62%. Gross yield in 4Q2022 fell 0.03 percentage point q-o-q, he says.

The highest yield was registered at Taman Indah Permai (3.87%), followed by Millennium Height (3.78%), Taman Jindo (3.69%), Golden Hill Garden (3.61%), Luyang Perdana (3.54%), Ujana Kingfisher (3.43%) and Taman Sri Borneo (3.39%).

For one-storey terraced houses, the average price growth was 4.07% y-o-y, he says.

“The highest y-o-y price growth was recorded in Taman Tuan Huat, with an increase of 4.26% to RM490,000, followed by Taman Sri Kepayan (4% to RM520,000) and Taman Nelly Phase 9 (3.96% to RM525,000). The q-o-q results show Taman Tuan Huat registering a 1.03% growth, followed by Taman Sri Kepayan (0.98%) and Taman Nelly Phase 9 (0.9%),” says Max.

Rental rates in Taman Tun Huat and Taman Nelly Phase 9 rose 3.33% y-o-y to RM1,550 per month and 3.13% y-o-y to RM1,650 per month respectively. Rents in Taman Sri Kepayan stood at RM1,750 per month, with no quarterly rental growth recorded, he says.

The average gross yield achieved for one-storey terraced houses was 3.87%, down 0.08 percentage point compared to 4Q2021. In 4Q2022, gross yield fell slightly by 0.04 percentage point q-o-q.

The highest yield was registered in Taman Sri Kepayan with 4.04%, followed by Taman Tuan Huat (3.8%) and Taman Nelly Phase 9 (3.77%), says Max.

Meanwhile, the condominiums in the monitor recorded an average price growth of 2.14% y-o-y in 4Q2022.

Max highlights that 1 Borneo Condominium registered the highest price growth y-o-y (4.1% to RM385 psf), followed by Bayshore Condominium (2.8% to RM550 psf), Jesselton Condo (2.6% to RM600 psf), Alam Damai (2.6% to RM595 psf), Likas Square (2.5% to RM405 psf), The Peak Condominium (1.5% to RM660 psf) and Radiant Tower (1% to RM495 psf). The average price for Marina Court remained unchanged at RM600 psf.

1 Borneo Condominium registered a price growth of 1.3% q-o-q, followed by Bayshore Condominium (up 0.9% q-o-q), and Jesselton Condominium and Alam Damai (both rising 0.8% q-o-q). There was no q-o-q growth recorded for the rest, he says.

Condos registered an average gross yield of 4.09%, a slight decrease of 0.02 percentage points y-o-y. Q-o-q, the average gross yield was down by 0.02 percentage points, says Max.

The highest gross yield for the condominium sampling was recorded at 1 Borneo Condominium (5.1%), followed by Likas Square (4.39%), Radiant Tower (4.29%), Jesselton Condo and Marina Court (both 4%), Alam Damai (3.7%), The Peak Condominium (3.66%) and Bayshore Condominium (3.55%).

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