Penang's Residential Market Likely To Slowdown In 2H15
Date：2015/02/11
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BUTTERWORTH -- The transaction volume of Penang's residential market is likely to slow down in the second half of this year, amid cautious buying ahead of implementation of the Goods and Services Tax (GST), says a property consultant.
According to PA International Property Consultants (Penang) Sdn Bhd, the transaction volume is likely to decrease five to 10 per cent, but prices would be maintained.
Executive director Loo Choo Beng said market players are expecting a between three to four per cent increase in property prices following the six per cent GST in April.
He added that properties in the secondary market and affordable segment would be an alternative for buyers.
"The general demand for properties is still there.But, purchasers are facing problems in securing loans," he told a media briefing on the Penang Property Market 2015, here Monday.
Loo said lower prices in the secondary market could pose a threat to new property sales.
" A rush to buying secondary market properties is likely ahead of implementation of the GST
"The residential property price trend for new launches in Penang will remain stable instead of rising, due to a wait and see attitude, over the impact of the GST. This is alongside more affordable projects to be launched this year," he added.
He said more property developers are expected to divert their products to the mainland and offer affordable homes with lifestyle facilities going forward to cater for growing demand.
On Penang's commercial market, Loo said the market is likely to consolidate amid less supply entering the market since the 1997/98 recession, and there was potential for rental growth as current rates are relatively low.
"Prices for commercial shops at prime areas will continue to increase, and that in secondary areas, maintained. Rentals remain stable with a yield compression of about four per cent to eight per cent," he added.
On Penang's industrial market, Loo said the state government should open up new industrial zones at Seberang Perai Utara, Tengah and Selatan with the lag in supply growth and limited supply underlining potential prices.