Property outlook for Seberang Perai ‘flattish’ this year, says consultant

Henry Butcher Malaysia’s Seberang Perai associate director Fook Tone Huat at the unveiling of the report today.

BUTTERWORTH: A property consultancy today said the property market in Seberang Perai is expected to remain “flattish” this year, with prices likely to remain “firm” due to the wait-and-see attitude of many prospective buyers.

Henry Butcher Malaysia’s Seberang Perai associate director Fook Tone Huat said the affordable housing market was expected to propel the market, with sale of high-end homes expected to remain stagnant.

He said the overhang or unsold units in Seberang Perai was relatively low at 932 units versus 2,329 units on Penang island last year. There was an oversupply of 3,261 units in the third quarter of 2018 in the entire state, an increase of 43.6% compared with the same period in 2017.

“The majority of these overhang units are condominiums or apartments, capturing nearly 67%. The current excess supply will gradually be digested by the market and the demand will return when the property market recovers.

The economy needed to be improved in order to see an improvement in the sale of properties, he said at the launch of Henry Butcher’s Seberang Perai 2018/2019 property market report in Perai here today.

Here are some of the salient points from the report:

There was only a slight increase of 0.74% year-on-year, with 3,116 transactions, in the residential sector in Seberang Perai in the first half of 2018.

The Central Seberang Perai district, where Bukit Mertajam is the main town, continued to be the choice district for residential property purchases. It garnered 45% of the total volume of transactions.

Prices of houses increased by between 4% and 9% at certain hotspots on the mainland. Prices of apartments and condominiums were generally “stable” at RM280 to RM350 per sq ft.

The sale of commercial properties went down by nearly 11% in terms of transaction value. There were 340 transactions worth RM184 million in the first half of 2018 compared with 382 transactions with a total value of RM202 million in the same period in 2017.

The supply of retail space in Seberang Perai stood at 704,637 sq m as of the third quarter of 2018. Major retail openings were IKEA in Batu Kawan and Tesco in Butterworth.

Another 330,000 sq ft of retail space is expected in the upcoming Sunway Carnival Mall expansion in Seberang Jaya and the new GEM Megamall at Jalan Baru, Perai.

The report says rental of retail spaces in Seberang Perai, in general, will come down under pressure due to the availability of new retail spaces.

As for the industrial sector, there was a moderate improvement in the first half of 2018 with a 5.15% increase, or 143 transactions worth RM252 million, compared with the same period the year before.

Most of these purchases were factories in Perai, Bukit Minyak, Nibong Tebal and other industrial estates with prices stable at the previous year’s (2017) level.

As for development land, there were a total of 463 transactions worth RM211 million in the first half of 2018, a 27.3% drop from the same period the year before.

The report indicates that prices for development land are expected to be the same as in 2018.