KUALA LUMPUR (Sept 15): The property market is expected to be on the recovery path in line with the gradual economic recovery, supported by the implementation of various government initiatives and assistance, said the National Property Information Centre (NAPIC).

It said the property market performance recorded a significant increase in the first half of 2021 (1H21) compared with in the same period last year.

In the Malaysia Property Market Report for 1H21 released today, it said a total of 139,754 transactions worth RM62.01 billion were recorded, showing an increase of 21% in volume and 32.1% in value compared with 1H20.

Volume of transactions across the sub-sectors showed upward movements, it said with residential, commercial, industrial, agriculture, and development land sub-sectors recorded year-on-year growth of 22.2%, 28.5%, 29.4%, 13.9%, and 21.3% respectively.

In terms of value of transactions, it also moved in tandem with residential, commercial, industrial, agriculture, and development land sub-sectors recording growth of 34.7%, 28.4%, 19.8%, 33.1%, and 40.6% respectively, said NAPIC.

As for residential property, it said there were 92,017 transactions worth RM34.51 billion recorded in the review period, and increased by 22.2% in volume and 34.7% in value year-on-year during when performances across the states improved in the review period.

"All states recorded higher market volumes except for Wilayah Persekutuan (WP) Putrajaya. The four major states (and federal territory), namely Kuala Lumpur, Selangor, Johor and Pulau Pinang formed about 50% of the total national residential volume," it shared.

In the primary market, the report showed there were 16,660 units launched, down by 34% against 25,227 units (revised) in 1H20 while sales performances for new launches 24.7% better than in 1H20 (revised 12.9%).

"The improvement in sales performance probably attributed to various measures by the government such as incentives of the Home Ownership Campaign, reintroduced from June 1, 2020 to Dec 31, 2021 and low overnight policy rate," it noted.

NAPIC said Selangor recorded the highest number of new launches in the country, capturing nearly 24.7% (4,114 units) of the national total with sales performance at 26.2% followed by Kuala Lumpur with 3,651 units or 21.9% with sales performance at 3.5%.

By property type, it said terraced houses dominated the new launches with single-storey units (2,624) and two- to three-storey units (5,455) together contributing to 48.5% of the total units, followed by condominium or apartment units at 41.4% (6,893).

According to the report, the residential overhang exhibited a moderated growth with a total of 31,112 overhang units worth RM20.09 billion recorded, showing an increase of 5.2% and 6.2% in volume and value respectively against the preceding half.

In terms of construction activity, NAPIC noted that it recorded an increase in completion, starts, and new planned supply, with each up by 8.7%, 35.3%, and 36% respectively compared with in the same period last year.

However, the Malaysian House Price Index (MHPI) saw an unprecedented negative growth in the second quarter of 2021 after a series of slow price growth since 2018, when it stood at 197.9 points, down by 1.2% year-on-year while on quarterly movements MHPI saw a decline of 1.6%.

For commercial property, NAPIC stated that there were 10,433 transactions worth RM10.93 billion recorded, up by 28.5% in volume and 28.4% in value compared with in the same period last year and all states and federal territories recorded more market activities in the review period except for WP Putrajaya and Pahang.

Selangor contributed the highest volume and value to the national market share, with 26.3% in volume (2,741 transactions) and 30.8% in value (RM3.37 billion), followed by Kuala Lumpur with 13% in volume (1,359 transactions) and 28.2% in value (RM3.08 billion).

The report showed the serviced apartment sub-sector recorded 1,912 transactions worth RM1.21 billion, forming 18.3% of the commercial property transaction volume and 11% of the value.

On the other hand, the serviced apartment sub-sector recorded 24,064 overhang units with a value of RM20.41 billion, indicating a marginal increase of 1.9% in volume, but value declined by 10.2% compared with in the preceding half.

Meanwhile, the unsold under construction recorded 42,358 units, increasing by 20.1%, it showed.

"The construction activities saw a mixed trend with completions decreasing by 8.3% to 4,030 units, starts increasing by 89.6% to 21,278 units, and new planned supply up by 33.7% to 7,339 units against in similar half last year," it said.

On the performances of shopping complexes, it said the segment moderated in 1H21, with the national occupancy rate seeing a slight decline of 76.6% compared with 1H20's 78.6%.

Kuala Lumpur and Selangor recorded 81.6% and 78.8% occupancy rates, respectively, whereas Johor and Pulau Pinang managed to secure average occupancy of 73.4% and 72.2% respectively, it said.

The report also showed the sole completion recorded in 1H21 was the extension of Setia City Mall, Shah Alam (21,363 square metres, bringing the total space for shopping complexes nationwide to 16.93 million square metres.

There were another 47 complexes with a total of 1.94 million square metres in incoming supply with another 10 complexes of 0.34 million square metres in planning, it said.

As of the purpose-built office space, it said the overall performance decreased to 78.5%, slightly lower than in 1H20 (80.6%) with the occupancy rate for private office buildings declining further to 71.7%, down from the 74.3% recorded in 1H20.

Pulau Pinang secured a higher occupancy rate of 85.3% while Kuala Lumpur, Selangor, and Johor recorded lower-than-national level at 73.8%, 68.4%, and 72.75%, respectively, the report said.

"Eight new purpose-built offices with office spaces totalling 505,842 square metres were completed in the review period, extending the existing market supply to 23.84 million square metres from 2,581 buildings.

"Kuala Lumpur was the lead contributor for office space with a share of 40.7% or 9.70 million square metres in the existing market, 54% or 1.09 million square metres in incoming supply and 52.9% or 0.17 million square metres in planned supply," it added.