The residential property market in Malaysia is showing signs of recovery last year after facing a dip in transactions from 2012.

According to recently released figures by National Property Information Centre (NAPIC), the number of residential property transactions in Malaysia have increased from 246,225 units in 2013 to 247,251 units in 2014, an increase of 1,026 units or 0.42%. The total value of transactions between 2013 and 2014 had also similarly increase from RM72.06 billion to RM82.06 billion, an increase of RM10 billion or 13.88%.

The increase in transactions is particularly noticeable in the primary market – new residential units launched by developers – which saw an increase from 41,190 units in 2013 to 53,777 units in 2014. This is an increase of 30.56% or 12,587 units transacted in the primary market. This also means an increase in value of transactions for the primary market from RM13.92 billion in 2013 to RM20.94 billion in 2014, an increase of 50.43% or RM7.02 billion.

However, the secondary market continues to show a slight drop since 2012 from 214,044 transactions in 2011, 212,428 units in 2012, 205,035 units in 2013 to 193,474 units in 2014. It was only a slight drop of 5.64% or by 11,561 units while the value of transactions went up by 5.13% or RM2.98 billion as the total value of secondary
market units transacted showed a rising trend from RM51.81 billion in 2012, RM58.14 billion in 2013 to RM62.12 billion in 2014.

Over in Penang, the total number of property transactions in the state had increased by 4.01% or by 710 units from 17,700 units in 2013 to 18,410 units in 2014. The total value of transactions between 2013 and 2014 had also similarly increase from RM7.09 billion to RM7.58 billion, an increase of RM490 million or 6.91%.

Again, the primary market in Penang also recorded increases while the secondary market showed a slight drop both in number of transactions and value of transactions. The primary market in Penang indicated a 48.91% increase in total transactions or an increase of 1,345 units to 4,095 in 2014 from 2,750 transacted units in 2013.

Meanwhile, in the secondary market in Penang, there was a 4.25% drop in transactions from 14,950 in 2013 to 14,315 last year. The value of transactions also saw a slight drop of 1.84% from RM5.88 billion in 2013 to RM5.78 billion last year.

A significant drop of transactions priced below rm100,000 to 3,460units in 2014 from a high of 10,436 in 2011 is a cause for concern.

Valuation Consulting & International Real Estate Company Raine & Horne International Zaki + Partners Sdn Bhd’s senior partner Michael Geh noted the overall increase in transacted units as a sign of the property industry
recovering from the continuous dip since 2012. “This could mean that the residential property market has hit bottom in 2013 and is looking up since mid – 2014,” he said.

He added that possible reasons for this upwards spike is the last minute rush by homebuyers to buy one before the implementation of GST. He does not see GST negatively affecting the residential property market much this year as House Buying is a nessesary act from the young couple new home forming, home upgrading to the empty nest selling for the elderly.

“It is hoped that Bank Negara will relax some of the loan requirements for first time home buyers and this will see continued interest in the residential property market,” he said.