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KUALA LUMPUR: Intenational rating agency Moody's says the property market will be dampened this year but large listed property developers are expected to be resilient.

Sales volumes are likely to moderate, but to remain supported by developers’ product offerings targeted at middle-income households and/or by contributions from their overseas projects.

“However, we expect developers focus on residential projects located in urban states such as Johor, Kuala Lumpur, Selangor and Penang to face challenges," it said in a report.

Since 2009, Malaysia (A3 positive) has seen a rapid rise in residential property prices.

The extent of the price rises in Malaysia raises the question of how vulnerable the banking and corporate sectors are to a possible shift in sentiment and downturn in the property sector.

It said macroeconomic conditions in Malaysia have recently turned less positive for rising housing prices.

In particular, the economy faces headwinds related to the ongoing downturn in commodity prices and slowdown in China.

"Demand will also be dampened by previous regulatory measures aimed at cooling the market, the implementation of a 6.0 per cent goods and services tax due in April, and the pass through of tighter monetary policy in the US."

“Despite these headwinds, our central scenario is for a soft landing in the Malaysian property market. Housing demand from middle income households will remain resilient.”

Moody's expects Malaysia’s gross domestic product growth to decelerate to a still-solid 4.5 per cent to 5.0 per cent in 2015, from 5.8 per cent in 2014.

Delinquencies on mortgages and construction-related loans will likely increase from their current multi-year lows, the report added.

"Malaysian banks have robust capital buffers and healthy pre-provision profitability. "

It added mortgages with high loan-to-value ratios and loans to overleveraged households and developers to be at risk of payment slippage.


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GEORGE TOWN: Property developer SP Setia Bhd has sold half of the 426 Setia Sky Vista units, ahead of its official launch.

of its latest property offering.

-- Sky Vista -- on Penang island, developer SP Setia Bhd has sold off half of the 426 units on sale.

The company’s northern region general manager, Ng Han Seong yesterday said that the response to the RM320 million project, on Penang island, has been encouraging.

“Moving forward, we will be planning our launches to suit market conditions, given the fact that controls in place by Bank Negara now are curbing speculative property investments,” he told reporters during a pre-Chinese New Year briefing at the company’s visitor centre here.

The Setia Sky Vista project, which will be located on the island’s southwest, comprises condominiums priced from RM552,000 each.

The 2.4ha project will comprise twin towers of 27 storeys and 32 storeys, respectively, which will be linked by a sky bridge.

The layout of the units, which are being touted by SP Setia as being “upscale yet affordable”, are now open for viewing at the Setia Welcome Centre’s show suite here.

Meanwhile, Ng also said on the drawing board this year is a proposed RM600 million high-rise residential project, which will be sited on a 3.8ha piece of land at Solok Slim on the island.

“We do not have other details,” he said, “as it is only at planning stage and things may change given the fluidity of the property market.”

Ng also announced that in conjunction with Chinese New Year this year, SP Setia will host its celebrations on February 28, which will include performances from an international acrobatics team from China.


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PETALING JAYA: Kwasa Land Sdn Bhd has awarded its first bumiputra project to develop residential housing to Impiana Land & Development Sdn Bhd.

This is also the first residential project award by the master developer of the 2,330-acre Kwasa Damansara township in Sg Buloh, which was formerly owned by the Rubber Research Institute Malaysia (RRIM).

Kwasa Land is a wholly owned subsidiary of the Employees Provident Fund.

Last year, Kwasa Land awarded a township development comprising 64 acres to Malaysian Resources Corp Bhd.

This second award, known as project R3-2, is an 8.79-acre parcel located near the 64-acre town centre development.

The residential development was expected to draw considerable interest among those in search of a home in the last prime acreage in the Klang Valley, Kwasa Land managing director Datuk Mohd Lotfy Mohd Noh said in a statement.

Sales for the whole development of 8.79 acres should be fully completed within a maximum period of six years.

The project benefits from a well-connected network of three current expressways and a new proposed Damansara-Shah Alam Expressway, two MRT stations and an adjacent Subang SkyPark air terminal. Impiana Land will be offering a mix of residentials.

Lotfy said: “The commercial independent evaluation panel had opined that the company offered a good net present value return to Kwasa Land at RM65mil or equivalent to RM170 per sq ft.”

Kwasa Land invited 23 bumiputra developers to submit proposals in October 2014. Impiana Land was among eight pre-qualified bumiputra developers who participated in the bid.

One was disqualified for not being statutory compliant, a Kwasa Land statement said.

Lotfy said the bids were “keenly competitive” but Impiana Land was “a clear-cut winner that offered the best design concept and return-on-investment.”

 


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