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Development density guidelines in Penang to take effect next year

Property News/ 10 November 2016 Leave a comment

development-densityThe guidelines for the increase in development density to 128 units per acre from 87 units per acre will only come into effect next year in Penang.

Penang Local Government, Traffic Management and Flood Mitigation Committee chairman Chow Kon Yeow said the state was in the process of fine tuning the guidelines.

He nonetheless noted developers will still have to comply with the same requirements like having traffic impact assessments and contributions to public amenities.

“Developers still have to adhere to requirements,” he said when asked about the issue today during a visit to the Seri Delima constituency.

The allowance to increase the density was announced by State Housing, Town and Country Planning Committee chairman Jagdeep Singh last month.

The reason being that the higher the density, the smaller the unit size and the smaller the unit, the cheaper the price, which will result in cheaper units across the board.

Units built under the increased guideline cannot be less than 900²ft and not cost less than RM400,000 while affordable housing elements and low-cost (LC) and low-medium cost (LMC) components are maintained.

On the RM150 million allocated to the Sungai Pinang Flood Mitigation Plan Phase Three, Chow said the federal funds were to be channeled directly to the Drainage and Irrigation Department (DID).

“The DID director will supervise the project and the state government will be keeping tabs on the progress,” he said.

Source: TheSunDaily.my

 

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  1. Jibril
    November 10th, 2016 at 09:25 | #1

    Cannot be less than 900sqft and must not cost less than RM400k. That translate to minimum RM444.44 per sqft.
    I think I’m in the wrong profession…if I’m a politician, I can get a bungalow with no swimming pool for only RM275.56 per sq ft….sigh

  2. Prop
    November 10th, 2016 at 09:31 | #2

    “Units built under the increased guideline cannot be less than 900²ft and not cost less than RM400,000”

    Not cost less or cost more than RM400,000? High density per arc but the price still higher than before ??

  3. Jibril
    November 10th, 2016 at 11:16 | #3

    @Prop

    It must not cost LESS than RM400k.
    With this new guidelines, the developer can build a house at 900sqft and sell it for RM1 million!
    Pity our children and grandchildren…..

  4. Ryu
    November 10th, 2016 at 11:19 | #4

    It means the State Government want the developers to build smaller size units and want more people to stay in the same place. For those people who prefer to stay condo, they want lower density to avoid more problems (human = problem).

  5. andyroy
    November 10th, 2016 at 11:42 | #5

    Jibril :
    @Prop
    It must not cost LESS than RM400k.
    With this new guidelines, the developer can build a house at 900sqft and sell it for RM1 million!
    Pity our children and grandchildren…..

    What a fxxxx guideline from local gov….all makan rasuah a lot. Is this the CAT policy??

  6. andyroy
    November 10th, 2016 at 11:46 | #6

    And partly blame ourselves also because all become greedy and sapu all the lousy projects hoping to make money in short time by selling it back after OC……hoping for good subsale value…..but the reality now nobody interested in your game ready.

  7. Messi
    November 10th, 2016 at 11:49 | #7

    You guys totally missed the point. The reason for this guideline is for developers to build bigger units so that they do not directly compete with the affordable housing category. Sure developers can build 900sft and sell at 1million but do you think they can actually SELL them? The answer no under the prevailing market condition is a resounding NO. developers are asking for trouble if they do so. Also with these guidelines it doesnt mean that the developers are free from building the affordable category or low cost.

  8. Dan
    November 10th, 2016 at 12:58 | #8

    @Messi
    they don’t understand~ haha

  9. buyer88
    November 10th, 2016 at 14:59 | #9

    The guidelines for the increase in development density to 128 units per acre from 87 units per acre …..
    number of units PER acre increased 47% from 87 units to 128 units…..
    SAME acre of plot size can have more units……

    you do the maths….

  10. Jibril
    November 11th, 2016 at 09:23 | #10

    @buyer88

    Good point there. The so called guideline will help the developer to earn money, where as the buyers will end up in a high dense, low square footage and expensive home.
    Once again I want to iterate that now the developer will be able tonnes of money with this guideline. They can build at 900sqft and will try to sold it at higher price than the minimum RM400k set in the guideline.

    @Messi

    I’m appalled with your statement “Sure developers can build 900sft and sell at 1million but do you think they can actually SELL them?”. Let me share an experience I had with a certain developer a couple of months ago. I went to their show office at Batu Maung to asked for any unit available for RM500k. The answer that I got was there was none. They told straight to my face that they are targeting oversea buyers for their projects.
    What happens when the guideline take into effect next year that us locals will lose our buying power to these type of buyers. We will not be able to compete with those type of buyers when the developer set the price higher than RM400k. What the local gov should do is set a ceiling price instead of a minimum price. Not to mention that we will lose to cash rich investors who will skew the property market, creating that so called “artificial” demand.

    That’s my two cents though..

  11. Andy
    November 11th, 2016 at 10:32 | #11

    With this guideline coming into effect next year, that means apartments/condos will sell about rm450 psf.If anyone is able to buy any residential properties be it be landed or non landed below 450psf, better make it fast…

  12. Messi
    November 11th, 2016 at 12:43 | #12

    @Jibril

    I think your views are biased

    1. Let me share an experience I had with a certain developer a couple of months ago. I went to their show office at Batu Maung to asked for any unit available for RM500k. The answer that I got was there was none. They told straight to my face that they are targeting oversea buyers for their projects.

    Comment : If developers choose to sell to foreigners only and restrict themselves what wrong does that trigger? Why is it your concern how much developers make. The developers can choose to sell to anyone regardless of the price of the property except those regulated by law. Its a willing buyer and willing seller situation. The developer has every right to reject you. Are you saying that developers MUST SELL TO EVERYONE who comes forth to buy? At most you can say that such a developer is arrogant . Your statement also suggests that you are making a blanket statement that every developer in Penang will react the same way. Developers also have reputations to protect lah.

    2. We will not be able to compete with those type of buyers when the developer set the price higher than RM400k.

    Comment: Did you ask yourself why you are unable to compete in the first place? If your income cannot support the purchase of a particular property , then is it the fault of the state government or the developers? The reason for the new guideline is precisely to cater for our own locals to ensure that the developers do not compete with the affordable category.

    3. What the local gov should do is set a ceiling price instead of a minimum price.

    Comment: This is the most naive statement. The affordable category has already set the ceiling prices for qualified buyers lah . The new guidelines are meant to regulate those outside the affordable category to ensure there is no competition so that qualified buyers can still enjoy the ceiling rate under the affodable category. If the government were to impose a ceiling for these units outside the affrodable category then it would restrict the freedom of the developer to do business . Developers are also businessmen, if policies are weighed too much against them , no one would want to be developers anymore. Who would suffer in such a scenario? There must be a balance my friend.

    My conclusion: your so called view is in fact very skewed and biased against developers. There must always be the right balance and the state government is continuing to do that. So please try to appreciate the facts from a more objective stand point.

  13. Messi
    November 11th, 2016 at 12:55 | #13

    Jibril:

    Good point there. The so called guideline will help the developer to earn money, where as the buyers will end up in a high dense, low square footage and expensive home.
    Once again I want to iterate that now the developer will be able tonnes of money with this guideline. They can build at 900sqft and will try to sold it at higher price than the minimum RM400k set in the guideline.

    Comment: You seem to be very pre occupied with how much a developer makes. My friend how much a developer prices his products depend also on market situations lah. Like i said before under current market U think developers will be so stupid to price 1million for 900sf???? They will kill themselves! so please dont assume that developers will make TONNES of money (to quote you) just like that with the increased density alone.

  14. edisongan
    November 11th, 2016 at 13:47 | #14

    @Messi
    Even though your reply was long, but indeed this is how I feel and truly agree with you too.

    Some people seem not to have figured out what’s going on yet. They still think the way they thought like a conspiracy between developers and government. Pretty naïve comments.

    I strongly agree with you is even the government set the guideline on the density and selling price, it also does not guarantee any help to those first time homer or everyone should be affordable to own an unit of property, what a big joke is if a government put the ceiling on certain issue must mean to help everyone to buy their desired and ideal properties?

    Another point from Jibril was pretty scaremongering as if the buyers are not mature enough to judge if the properties are really worth the value. This is free market, as long as developers fulfill whatsoever government ‘s statutory requirements, they could build and sell the price they think it’s sellable and that’s up to buyers to think if it’s worthy to buy..Are developers also that naïve to build a 900sqf medium cost condo and trying to sell RM1 million and you expect a big crowd queueing for it ??

    Come on, even for speculators are not stupid too, they also will think after they have purchased, couple years later if they are able to sell off with certain margin..They also will not simply hamtam without knowing the market price and capacity of digestion..If they cannot hold long, they will also undercut their margin and try sell off even if it’s lower than RM400K just to stop bleeding..

    So, last but not least, some comments were pretty biased and egoistic …Do not underestimate others and overestimate yourself..Government sets rules is to regulate developers and ensure buyers have the best interest of it…Developers also have their targeted pool of customers, vice versa to buyers have their own targeted projects to consider and buy. So, enough of those sayings like conspiracy and MUST help everyone to buy property..

  15. meerebus
    November 11th, 2016 at 14:42 | #15

    Haha…..it’s fun seeing you guys talk. Few things I’d like to comment :-

    @edisongan

    You said “…. as if the buyers are not mature enough to judge if the properties are really worth the value…”.

    I say – yes, there are in fact a lot of gullible buyers out there, who do not have any idea on how to value a property, therefore ending up in their current predicament of getting stuck with worthless properties now.

  16. meerebus
    November 11th, 2016 at 14:57 | #16

    @Jibril

    I empathise with your well intentioned concerns, but pls take note that the article did mention that “Penang Local Government, Traffic Management and Flood Mitigation Committee chairman Chow Kon Yeow said the state was in the process of fine tuning the guidelines.”.

    Anyway, I have good news for you. I heard one developer will be launching a new project based on new guidelines, selling at RM400k for 2000sf units! Don’t be angry first, good things are coming!!

  17. edisongan
    November 11th, 2016 at 15:14 | #17

    @meerebus

    Dude, when you mentioned “a lot”, means majority, so be careful unless you have conducted the findings with statistic / poll to prove it..

    My personal opinion is surely there are some gullible buyers but doubt they are majority.
    I view the guideline more positively because it draws a very clear base line to developers, as well as buyers.

    Let’s think for future, there will be more projects with smaller size (below 900sqf) with above selling price RM400K if there is no any statutory guideline to restrict it? So, what’s so worried about developers building 900sqf apartment with selling price more than RM400K? It does not make sense to me if you are going to tell me most buyers will be willing to pay for higher price if the quality and workmanship are bad..

    Buyers will weigh and gauge themselves..If placing the wrong stake on it, then be it..This is life but surely nothing to do with some funny sayings about “government is directly pushing up the price and helping developer in reaping more profit”…Atleast, I am not convinced…I don’t know how others feel..

    Thank you

  18. Ryu
    November 11th, 2016 at 15:44 | #18

    How you all define worthless properties? Many of the properties sold in Penang Island were about 400-500k, the average construction cost together with the profit margin set by developers are about the same. Some may earn more or earn less but confirm the price won’t go down to under “affordable house range, 400k”. Most buyers willing to pay more 600-700k for prime location (example like the Tamarind etc).

  19. Andy
    November 11th, 2016 at 15:44 | #19

    @meerebus
    RM400K for a 2000 sf unit?where is that?I am definitely interested..

  20. Messi
    November 11th, 2016 at 16:12 | #20

    Properties can never be worthless lah. There is always a value to immoveable properties. I think what meerebus meant was some people find it hard to sell some properties they bought or bought at the wrong price.

    Then again, no one forced the purchaser to buy at a particular price without doing survey first. The developer didnt point a gun at his head. If a purchaser finds he is stuck and he cant sell his property it can mean he either bought it high or might have set himself a high target to sell at a certain price. Either way, this has totally nothing to do with state policies and developers or that properties are “worthless”.

  21. meerebus
    November 11th, 2016 at 16:20 | #21

    @Messi

    You said “……Then again, no one forced the purchaser to buy at a particular price without doing survey first. The developer didnt point a gun at his head. If a purchaser finds he is stuck and he cant sell his property it can mean he either bought it high or might have set himself a high target to sell at a certain price….”.

    I say, “without doing survey first” & “bought it high” are typical attributes of gullible buyers.

    If you own something that does not generate cash flow (can’t rent out), and is worth less than what you paid for, that is as good as worthless.

  22. Messi
    November 11th, 2016 at 16:26 | #22

    In general people refuse to see the rationale behind state policies and refuse to accept that in every policy there must be a balance of interests of the developer and the people. Many are “very concerned” with how much developers earn instead and start imagining conspiracy theories. They get so blinded with jealously leading to errorneous conclusions.

  23. Messi
    November 11th, 2016 at 16:32 | #23

    @meerebus

    1. I say, “without doing survey first” & “bought it high” are typical attributes of gullible buyers.

    Agreed

    2. If you own something that does not generate cash flow (can’t rent out), and is worth less than what you paid for, that is as good as worthless.

    Comment: Bizzare! So what you’re saying is: So long as a property cannot be rented out then it is deemed worthless. Alright my friend . I’ll let other readers be the judge of that ! HAHA

  24. Messi
    November 11th, 2016 at 16:35 | #24

    Even if a property is value drops below to what it is paid there is still a value to it when its sold lah kawan! HOW CAN THAT BE DEEMED WORTHLESS?

  25. edisongan
    November 11th, 2016 at 16:44 | #25

    @Messi
    Hahaha..He kept saying the “gullible” batch of people..What can I say…There are gullible people in all different investments, not just property..How about stocks market, gold trade, bonds , MLM and etc? Aiyo…How you want to compare then? Majority is still calm, cautious and meticulous for their property purchase..

    Gullible people cannot be taken as a whole and the only reference, right? Government sets rules not to encourage speculators / greedy but tight cash-flow players to go into market but more on hoping to regulate developers and protect the best interest of consumers…

    Anyway, I just feel that we view the issue under different perspectives, so it’s tough to argue over ..If really feel so bad and negative about this guideline then quickly buy one loh since some think that this is to push up the selling price in near future..

    Ok lah..need to work liao..talk again..Cheers!

  26. Jibril
    November 11th, 2016 at 16:51 | #26

    I guess I am bias towards the people instead of the developers.
    Some questions to ponder..

    1. Who did the local government consulted to come to the decision? Does the voice of local Penangites been heard?
    2. What is wrong with the previous guideline of 87 units per acre? It was introduced back in 2012. Before that, the guideline was 30 units per acre. So 4 years from now the local gov can change the density again to say 250 or 500 units per acre?
    3. How the local gov come to the decision that 900sq ft at RM400k is the right combination? Is that a right combination for the locals or for the developers? Once again, I beg the questions who the local gov consulted to come to that decision?

  27. Messi
    November 11th, 2016 at 16:51 | #27

    @edisongan

    I agree there will be gullible people out there but issue is if people dont do their own survey and market research before they buy their properties, can blame others when they cannot sell it ah?

    And secondly i simply cannot wrap my head around his definition of a property becoming worthless because it cannot be rented out or it falls below the price it was paid for. If this is his definition then ALL properties in the secondary market will have ZERO value meaning there will never be any subsale transaction because worthless carries a meaning that it has totally no value at all, ZERO just because it cannot be rented or sold for below the price paid for. THAT TO ME IS SO RIDICULOUS

  28. Jibril
    November 11th, 2016 at 16:54 | #28

    I guess I am bias towards the people instead of the developers.
    Some questions to ponder though..

    Who did the local government consulted to come to the decision? Does the voice of local Penangites been heard?

    What is wrong with the previous guideline of 87 units per acre? It was introduced back in 2012. Before that, the guideline was 30 units per acre. So 4 years from now the local gov can change the density again to say 250 or 500 units per acre?

    How the local gov come to the decision that 900sq ft at RM400k is the right combination? Is that a right combination for the locals or for the developers? Once again, I beg the questions who the local gov consulted to come to that decision?

  29. Messi
    November 11th, 2016 at 16:55 | #29

    TO make things simple. Say you buy a property for RM1mil and it cannot be rented out but someone offers you RM800k for it. How can it be worthless when there is a ready buyer for 800k????? isnt the 800k a value attached to it ?

  30. meerebus
    November 11th, 2016 at 17:25 | #30

    @Messi

    When I mentioned “worthless” the first time to edisongan, I was referring to his comment of “as if the buyers are not mature enough to judge if the properties are really worth the value”, and in order to highlight how gullible buyers have been in the past few years buying properties that are now worth less than what they paid for, and also not able to generate cash flow due to the difficulty in renting out, I used the word “worthless”, and subsequently explained my definition of that word.

    I am very sure a person with reasonable intelligence would understand that I did not mean the value of any property being ZERO, but then I am not sure about you, as you have shown to be struggling to grasp the gist of it. Oh yes, I’m sure you’re going to come back and dwell obsessively about this. Surprise me!…:))

  31. edisongan
    November 11th, 2016 at 17:28 | #31

    @Messi
    Yeah man..I am with you, ok…His comments were too extreme and always take the minority of people (gullible people) as example..Haha..

    Anyway, don’t take it too hard and serious lah..Obviously he replied not to the right points of our pointers…so meaningless to argue with him..

    I also cannot agree with his “worthless” comments on property once it’s not successfully let go/leased out…Very ridiculous …

  32. meerebus
    November 11th, 2016 at 17:33 | #32

    @Messi

    By the way, after all I said, I hope you realize that I am not opposing nor supporting the new guideline, just in case the reason you did all this is for defending the new guideline, thinking that I am opposing it. Hope that saves you some precious time.

  33. CharKoayTeow
    November 11th, 2016 at 18:28 | #33

    Aiyoh, some of you teruk lah in English.

    When ppl said a lot of ppl, it means many ppl but some of you interpreted a lot means majority pulak. A lot and majority same meaning meh ?

    When ppl said worthless, it means not worth or means worth very little but some of you interpreted worthless as ZERO value pulak. Worthless and Zero value same meaning meh ?

  34. mountain fish
    November 11th, 2016 at 18:48 | #34

    “worth less” as in less worthy as envisioned or expected should clear this simple mess.

  35. edisongan
    November 12th, 2016 at 09:10 | #35

    @CharKoayTeow
    Ya loh..we should learn English from you so when we mean slot is minority and a few is majority then worthless becomes less worth…I should probably go back to school and backfire my English teacher by telling them that when 2 out of 10, they should say “lot of them or many of them” and when “7 out of 10” should be few of them….

    It is always easy to make shocking statements to curry favour but we feel strongly how he tried to mean..Don’t assume things as if people are just like you

  36. edisongan
    November 12th, 2016 at 09:22 | #36

    @mountain fish
    In the last sentence, he mentioned “worth less than” and “worthless” both…Worth less means less worthy of course and Worthless means valueless…wonder if you guys are really so hard to understand his comments? Read again the last sentence from him “If you own something that does not generate cash flow (can’t rent out), and is worth less than what you paid for, that is as good as worthless.”

    If you still try harbour his worthless means less worthy then like I said, we don’t just view the issues differently but also having different level of understanding in English language..

  37. walaoeh
    November 12th, 2016 at 18:54 | #37

    Such trivial issues warrants such lengthy debates.
    Penang people really have so much free time.

  38. CharKoayTeow
    November 14th, 2016 at 17:33 | #38

    @edisongan

    Huh, wanna to fire your English teacher pulak ?
    Not fire your English teacher for your poor English but fire yourself for your poor and confused learning. Fire your parents for choosing lousy English teacher for you.

  39. edisongan
    November 15th, 2016 at 09:01 | #39

    @CharKoayTeow
    Hahaha…Ah Bo then…Walau….Your school so good one, can choose English teacher one? Sorry man, mine was not like yours, school teachers were pre-fixed and assigned to my class nia..But I believe they were good enough to be my English teacher as now I could speak freely most of the time to my European customers without any communication breakdown and misunderstanding..

    That’s why I said I should learn from your to another level of height…Since your understanding was so different from ours..Hahaha..

  40. edisongan
    November 15th, 2016 at 09:02 | #40

    @walaoeh
    Dude, sometimes, it’s just for fun…Boring at work mah…

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