THE Penang property market, which had truly began seeing a rebound in transactions since final yr, is predicted to renew its recovery path into 2022.
CBRE|WTW director Peh Seng Yee says the Penang property market can anticipate a “rebound amid lingering challenges” this yr.
“We do expect a recovery in market activity for 2022. Prices of landed properties will continue to remain resilient.
“For the high-rise sub-sector, it will continue to be a buyers market,” he says at the launch of CBRE|WTW’s 2022 Market Outlook Report, lately.
Peh provides that future launches will typically comprise self-sustained developments that might be on a smaller scale, whereas at the similar time fulfilling the demand for reasonably priced items.
Knight Frank Penang government director Mark Saw additionally says the residential sub-sector in Penang has improved, posting larger quantity and worth of property transactions as of the third quarter of 2021.
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“The Penang state government’s commitment to increase home ownership with plans for a range of affordable homes in various strategic locations, extension of the Penang Home Ownership Campaign until June 2022 and enforcement of mandatory installation of fibre optic telecommunication infrastructure for all new developments, will spur the state’s residential property market.”
In phrases of challenges, Peh says shortage of sizeable land in Penang will nonetheless proceed to pose growth constraints.
“Additionally, the prolonging effects of the pandemic, especially with the new Omicron variant, could result in cautious spending and a wait-and-see approach.
“Stringent lending guidelines and concerns over job security could also potentially derail the market,” says Peh.
On the outlook of the Penang workplace market, Peh says the phase is predicted to stay wholesome this yr, with steady leases and occupancy charges.
“The prospects of co-working spaces still remain encouraging,” he says.
As for Penang’s retail sub-sector, Peh says the removing of motion restrictions since final yr has been a lift to this sector.
“We see normalisation amid ‘freedom euphoria’. However, we expect rentals to be flattish and a widening gap between the newer and older shopper complexes.”
As for Penang’s resort sub-sector, Peh says this phase is about for a gradual recovery if the pandemic is considerably contained.
“The segment can be spurred further by travel bubbles and other government initiatives.
“We also see pent-up demand for medical tourism and intensifying market competition for the hotel sub-sector.”
Meanwhile, Knight Frank Malaysia in its actual Estate Highlights for the second half of 2021, says the Penang residential market is predicted to select up this yr, supported by a collection of measures introduced underneath numerous stimulus packages and Budget 2022.
“This will encourage people from various income levels to purchase their dream homes. The overhang of high-rise residential properties, especially in the category of condominiums and apartments, has also been growing.”
With restricted new provide of purpose-built workplaces in the state (present and future), Knight Frank says the occupancies and rental charges for higher grade purpose-built workplace buildings are anticipated to carry regular.
“Meanwhile, with the growing work-from-home trend, some business premises have been converted into co-working space.”
Knight Frank famous that the nation’s vaccination fee has continued to enhance and with additional easing of restrictions, the retail phase is predicted to slowly get better.
“Selected retailers are expected to embrace the rise of eCommerce as they head down the path of recovery.”
It provides that Penang’s industrial phase has continued to stay sturdy and regular all through the pandemic.
“This is especially with the Penang state government’s commitment to expand another two industrial parks in Batu Kawan, with focus on the logistics industry and the remaining phases for mixed industries.
“This industrial park is set to continue its history of the successful Bayan Lepas Industrial Park.”
Meanwhile, CBRE|WTW in its 2022 Market Outlook Report says property transaction actions in Penang elevated for the interval of January to September 2021.
“A total of 11,981 properties valued at RM7.23bil were transacted, reflecting 13.9% and 33.9% increase in volume and value, respectively, year-on-year.
“As more businesses are allowed to operate, the Penang property market has generally rebounded.”
CBRE|WTW is optimistic that the rebound will lengthen into this yr.
“However, the rebound would be gradual as the pandemic lingers on, along with a sluggish economy and higher cost of living.”
CBRE|WTW additionally expects to see extra cut price trying to find residential items this yr.
“The overhang remains a concern. Prospective purchasers can negotiate for more discounts in addition to the incentives offered,” it says.
According to the National Property Information Centre (Napic), there have been 30,290 unsold accomplished residential items (overhang) value RM19.75bil as at September 2021, in contrast with 30,926 items value RM19.99bil in the earlier corresponding interval.
Of the 30,290 overhang items, 18,829 items (or 62.2%) comprised high-rise items, whereas 6,803 items (22.5%) consisted of terrace homes.
The bulk of the overhang items had been targeted primarily in Johor (6,441 items), Penang (4,638 items), Kuala Lumpur (3,863 items) and Selangor (3,376 items).
Napic says 33.7% of the overhang properties consisted of items ranging between RM500,000 and RM1mil, whereas 28.4% comprised items ranging between RM300,000 and RM500,000.
Units under RM300,000 comprised 25.5% of the complete overhang, whereas items above RM1mil (12.4%) consisted of the remaining unsold items throughout the interval underneath assessment.
Knight Frank concurs that the total property overhang standing continues to stay elevated, particularly in the high-rise residential phase.
“The performance of the residential sub-sector is improving gradually, registering higher volume and value of property transactions as of the third quarter of 2021,” it says.
