Apr 28, 2017 Last Updated 8:39 AM, Sep 4, 2016

Investments

PETALING JAYA: Property sales rose to about 18% in the second half of 2015 compared to the first half of 2015, although property launches slowed, according to a survey by the Real Estate and Housing Developers’ Association Malaysia (Rehda).

In the first half on 2015, 5,195 units were sold compared to 4,371 unit sold in first half of 2015.

The survey showed 62% of respondents reported that unsold units mainly from Selangor, Johor and Pahang in the second half of 2015 from 78% in the first half due to better sales.

Rehda president Datuk Seri FD Iskandar said sales for low cost houses and single-storey terrace units saw a pick up in the second half of 2015. Bigger residential units such as bungalows and semi-detached units also saw an increase during the period.

“Developers see that home seekers are sensitive to price, hence they will modify their launches to more smaller-sized units,” he told reporters during his presentation on the property industry survey 2H 2015 and market outlook for 2016.

He said that high-rise properties remain popular among home-buyers.

Iskandar expects property prices to remain stable with houses priced between RM200,000-RM1mil to lead the market.

PETALING JAYA: The Real Estate and Housing Developers Association (Rehda) is in discussion with the Government to bring back the developers interest bearing scheme (DIBS) in a certain form for first-time house buyers of a certain price, Datuk Soam Heng Choon said at a property forum.

Soam, who is also IJM Corp Bhd CEO and managing director, told participants this while moderating a forum session at the Rehda Property Forum 2016 yesterday.

“We are engaging with the Government on this,” he said.

The scheme, which allows a house buyer to pay a downpayment of between 5% and 10%, and the rest on completion of the property was banned on Jan 1, 2014 because it was deemed to encourage speculation.

It was the first cooling measure to be banned in Singapore in its fight against rising house prices.

While the removal of the scheme and macro-prudential measures weeded out speculation, it came at the expense of plummeting sales.

Earlier, Rehda president  said a survey conducted among 159 developers in 12 states in the second half of 2015 showed that properties between RM250,000 and RM700,000 had the highest loan rejection rate.

He said 67% respondents believe end-financing was the culprit for unsold units.

He said unsold stock would rise and will also affect affordable housing. “Loan rejections rate is more than 50%,” he said.

Unsold units for the first half of 2015 was manageable with 68% of respondents having up to 30% of unsold units. Residential sales rose by a fifth in the second half compared with the first six months, although launches slowed.

Respondents with unsold units mainly in Selangor, Johor and Pahang decreased from 78% in the first half to 62% in the second half of 2015. Respondents were also pessimistic about the first half of 2016.

Soam said stringent lending conditions will come at the cost of high home ownership. Although Malaysia has a high household debt against gross domestic product of close to 90%, the highest in South-East Asia, on closer scrutiny, only 50% of this debt were mortgage-related while in Singapore and the US, mortgage debt make up 74% of their household debts. There is therefore room for mortgage debt to go up.

“Curtail unproductive loans,” he said.

Two of the forum panel speakers Maybank Malaysia head of community financial services Hamirullah Boorhan and Khazanah Research Institute managing director Datuk Charon Wardini, however, said home ownership should not be achieved at the expense of high household debt.

Instead, one of the ways, Charon said, was to modernise and cut house prices by building housing cheaper and faster using Industrial Building Systems (IBS), a housing construction technique used by the Chinese and a company in the Philippines.

“If Philippines can do it, why can’t we?” he asked. Charon also said social housing – or affordable housing – at RM500,000 were “not affordable to many.”

“It should (be capped) at RM300,000,” he said. Charon said in order to put the housing sector into its proper perspective of demand and supply, what is needed is a national housing survey.

“You cannot talk about the Malaysian housing market per se but you can talk about the Kuala Lumpur housing market, or the Johor or Penang market,” Charon said.

It has to be very location-based because the median household in Kuala Lumpur is much higher comparative to some locations outside the Klang Valley, he said.

 

 

Source: thestar

Petaling Jaya – Property developer Tropicana Corporation Berhad (“Tropicana” or “Group”) today announced its unaudited financial results for the financial year ended 31 December 2015.

For the fourth quarter under review, the Group recorded revenue of RM304.9 million, compared to RM904.0 million registered in the corresponding quarter last year. Included in the revenue from the corresponding quarter in 2014 was land sale of RM470.7 million. Profit before tax (“PBT”) was lower at RM54.7 million for the current quarter under review, compared to RM234.5 million recorded in the previous corresponding quarter, which also included gain from land sale of RM167.9 million and RM17.1 million fair value adjustments from investment properties.

Consequently, Group revenue in the full financial year ended 31 December 2015 stands at RM1.25 billion as compared to RM1.76 billion in fiscal year 2014. For the year, Group PBT decreased to RM297.1 million from RM411.6 million from a year ago, whilst net profit attributable to shareholders in FY2015 was RM223.3 million compared with RM333.9 million previously.

Excluding the financial impact from land sales and fair value adjustments, performance was in line with expectations with revenue contribution driven by steady construction progress from the Group’s ongoing developments.

Tropicana proposed interim single tier dividend of 2sen per share, which raised the total single tier dividend declared for the financial year ended 2015 to 7sen per share, translating to a dividend yield of 6.1% (based on Tropicana’s share price of RM1.55 per share).

Notwithstanding the more challenging market conditions, the Group achieved total development sales of RM1.55 billion for fiscal year 2015, exceeding the previous year’s total sales of RM1.49 billion. The stronger sales performance has resulted in the Group’s unbilled sales reaching a record high of RM3.13 billion, placing it in a comfortable position to deliver sustainable earnings performance in the current year.

Tropicana Aman continues to draw healthy interest.

Tropicana Aman continues to draw healthy interest.

Tropicana’s de-gearing initiatives are also bearing fruit. The Group’s financial position has strengthened considerably, with net gearing at the end of December 2015 brought lower to 0.30x, a marked improvement from 0.68x registered as at the end of December 2014. Proceeds from Tropicana’s strategic disposal of its non-core assets and investment properties has reduced net borrowings by half from RM2.0 billion as at end of 2014 to RM0.9 billion as at end of 2015.

The Group will carry on with its strategy to unlock the value of its 1,600 acres of prime land that has potential Gross Development Value in excess of RM50 billion. Property development remains the core focus, with planned launches in 2016 worth an estimated RM1.7 billion primarily in the Central and Northern regions. Albeit that the market continues to face headwinds, the Group believes it has the right product mix to appeal to the broad market, where there is sustainable demand for landed properties and integrated developments in good locations, great accessibility and attractive pricing. Tropicana’s integrated township development in the Central region continues to draw healthy interest. New launches such as Tropicana Aman in Shah Alam and Tropicana Heights in Kajang attracted good take-up rates from buyers.

Tropicana is also steadfast in its focus to further improve its gearing position. Continuing with its asset sales momentum, the Group separately announced in January 2016 the proposed sale of its Sky Express Hotel and Dijaya Plaza in Kuala Lumpur that will collectively bring in gross proceeds of RM195 million. With property development as its core focus, together with its high unbilled sales and a strengthened balance sheet, Tropicana is well poised to deliver improved performance going forward.