The aspiration of owning a home, a cornerstone of financial stability and future planning, remains an uphill battle for many Malaysian millennials residing in major cities. The intertwining factors of skyrocketing property prices and an unyielding surge in the cost of living create a formidable barrier, leaving the younger generation, aged 25 to 45, grappling with deferred homeownership despite government initiatives like the National Affordable Housing Policy.

Over-commitment

A comprehensive study conducted by Universiti Putra Malaysia underscores the financial challenges gripping the younger generation. Dr. Mohammad Mujaheed Hassan, from the Urban and Regional Planning Department, reveals a stark reality: high financial commitments, including monthly car installments, credit card debts, and rental expenses, are stifling the ability to accumulate savings for a home. The symbolism attached to car ownership, despite some individuals relying on public transport, leads to over-commitment, leaving limited disposable income for savings or investment.

Wrong Estimates

Contrary to their financial capacity to afford homes based on monthly rental payments, many millennials prefer the perceived financial safety net of renting. Dr. Mohammad Mujaheed’s insights suggest that additional costs associated with homeownership, such as taxes, maintenance fees, and the perceived distance from workplaces, deter the younger generation from taking the homeownership plunge. Personal loans and credit card debts further contribute to their financial quagmire, pushing homeownership down the list of priorities.

Worrying Trends

The trend of prioritizing short-term financial commitments over the long-term goal of homeownership raises red flags. Dr. Mohammad Mujaheed warns that such prioritization could lead to prolonged debts, potential blacklisting by financial agencies, and a cascade of issues, including financial stress and limited housing options in the future. The urgent need to address these concerns is underscored by the looming possibility of a segment of the younger generation facing homelessness or perpetual renting from one generation to the next.

Housing Affordability Gap

Dr. Azizul Azli from Universiti Teknologi Mara sheds light on the widening chasm between income levels and house prices, characterizing it as a significant roadblock to homeownership. Annual salary increments fall far behind the rapid surge in property values, creating an insurmountable gap. Azli advocates for proactive government intervention, emphasizing the necessity of incentives for developers to construct more affordable landed houses and a streamlined approach to bureaucratic processes that contribute to escalating construction costs.

The financial stretch of urban living in Malaysia, coupled with the millennials’ penchant for immediate gratification, places the dream of homeownership at a critical juncture. Overcoming over-commitment, dispelling wrong estimates, addressing worrying trends, and bridging the housing affordability gap require a concerted effort from both policymakers and developers. Government initiatives, coupled with strategic incentives for affordable housing development, hold the key to transforming the homeownership dream from an elusive pursuit into a tangible reality for the younger generation. As the nation grapples with economic dynamics, ensuring that millennials can secure a stable housing foundation becomes paramount for their future and the overall socioeconomic landscape.

IJM Perennial Development Sdn Bhd (IJMPD) is currently negotiating for a China and a US-brand name hotels to operate in the RM4.5bil Light City mixed development project in Penang, says general manager Tan Hun Beng,

IJMPD is a joint-venture (JV) company between IJM Corp Bhd and Singapore based Perennial Holdings Pte Ltd to oversee The Light City project located next to the first Penang bridge. Tan told StarBiz that the company has allocated a 31-storey building block to accommodate the two hotels and nine-storey offices. Both the four and five-star hotels will have a gross development value of RM650mil and a total of 459 rooms, Tan said.

“This could be the country’s first China hotel brand name,” he said, adding that “A China-based operator will operate the hotels aimed at the corporate market, serving the needs of businessmen visiting Batu Kawan and Bayan Lepas Industrial Parks.”

Tan also expects the recent inflow of investment into Penang will fuel the need for hotel rooms. He noted that the company will soon be announcing on the two hotels and their respective operators.The Light City’s main attractions include a 680,000-sq-ft shopping complex called The Waterfront Shoppe, accommodating a 45,000-sq-ft cineplex, a 30,000-sq-ft supermarket, a 30,000-sq-ft food court and the 70,000-sq-ft Penang Waterfront Convention Centre.The mall will also have a multi-storey car park with electric vehicle charging stations and 3,000 parking bays.

“Some parts of the mall will be designed to resemble the island’s iconic landmarks,” added Tan.

IJMPD had recently signed a tenancy agreement for a Hong Kong-based supermarket brand to be one of the mall’s anchor tenants. The company will also sign with a well-known Cineplex brand name soon.

According to Tan, IJMPD’s shopping complex will have 40% allocation for food and beverage and entertainment businesses to keep up with changing trends and to stay competitive in the mall business.

“We will sign with most tenants in 2024, as the mall is scheduled to be ready by early 2025.” Tan noted.

Meanwhile, The Light City also has a residential component known as the Mezzo, a 30-storey building with 456 condominiums, priced from RM900,000 when launched in early 2021. Since the soft launch in February 2021, IJMPD has sold about 70% of the Mezzo residence.

“Many of our customers come from Singapore and Hong Kong, keen to invest because of the weakening ringgit. We, in fact, have sold many units through online sales presentations,” Tan pointed out.

As for The Light City second phase, he said the development will have a 340,000 sq ft net lettable area, a commercial tower and the Essence residential condominium.

The Retail Group Malaysia (RGM) last month revised the retail sales projection for the fourth quarter of 2023 to 2.1% from its 3% forecast in September 2023.

Both Malaysia Retailers Association and Malaysia Retail Chain Association (MRCA) also projected the same similar figure for the final quarter.

According to RGM, the persistent increase in food prices in the fourth quarter impacted the costs of home cooking and dining out and the consumers’ purchasing power.

However, RGM said the higher cost of living weakened spending power and raised the prices of necessities and consumer goods despite shopping traffic returning to pre-Covid levels. RGM pointed out that the weak ringgit also made importing raw materials, semi-finished goods and finished retail goods more expensive.

Consequently, many Malaysians have deferred the purchase of high-value consumer goods, it added. Looking ahead to 2024, RGM forecasts a 3.5% growth rate for the Malaysian retail industry.

MRCA, meanwhile expects the local retail industry to grow by 3.3% to 3.5% in 2024.

Deputy president Datuk Ken Phua said: “This was based on a moderate and conservative estimation because of the sales and service tax hike, higher raw material costs, and geopolitical issues.

“We have decided to retain this estimate although Bank Negara recently forecast a gross domestic product (GDP) growth of 4% to 5% this year,” Phua said.

A recent MIDF Research report noted that Malaysia’s retail trade is expected to expand by 7.5% in 2024 due to resilient consumer demand amid a healthy labour market and softening inflation pressure.

The Mordor Intelligence recent report also highlighted that the local retail market size is valued at USU$89.66bil in 2024, and it is expected to reach US$119.64bil by 2029, growing at a compounded annual growth rate of 5.94% during the forecast period of 2024 to 2029.

For decades, the local retail industry has been one of the largest contributing sectors to the country’s GDP.

Source: TheStar.com.my

Aspen Group inaugurated its latest project, called Versa, a two-tower residential development and nine commercial units, in Batu Kawan last Friday.

Strategically nestled in the freehold township of Batu Kawan, Versa promises residents unparalleled comfort, convenience, and a gratifying lifestyle.

Its effortless access to amenities such as IKEA Batu Kawan, Klippa Shopping Centre, major expressways, and industrial hubs, ensures a well-connected and enriching living experience.

Aspen Group president and chief executive officer Datuk M. Murly said the objective in realising the idea of this new project (Versa) is to ensure everyone is allowed to own a home without hefty price tags.

“Versa, being our ninth development here in Batu Kawan, showcases contemporary living spaces starting from RM370,000 onwards.

“These meticulously designed homes cater to the needs of various home-seekers, investors, professionals seeking a convenient and sophisticated lifestyle, as well as parents securing a haven for their children,” Murly said in his speech during the inauguration ceremony of Versa in Batu Kawan today.

Versa is a collaboration between Aspen and Ikano Retail within AVC, marking its distinction as the fourth residential development in this visionary urban landscape.

Chief Minister Chow Kon Yeow, who graced the ceremony earlier, congratulated Aspen and Ikano Retail for their outstanding contribution to Batu Kawan’s landscape.

“The inauguration of Versa stands as a beacon of innovation and excellence, emblematic of the state’s commitment to elevating living standards and fostering viable communities.

“As we commemorate the achievements of today, let us recommit ourselves to the continued progress here in Batu Kawan.

“Let us strive to create an ecosystem where opportunities abound, where sustainability is not just a buzzword but a way of life, and where every individual plays a role in the greater good of our community,” Chow said.

Occupying over five acres of land, the project is part of the 247-acre Aspen Vision City.

The project is said to have two towers, Block A and B respectively. Units at both towers are sized at 703 sqft each.

According to a report published last year, it was learnt that the take-up rate at Block A has succeeded by more than 50 per cent.

Earlier, Aspen and iBilik inked a Memorandum of Understanding (MoU) that will see both the parties introduce a co-living experience at Vivo Executive Apartment and Versa, making a transformative leap in property management through a state-of-the-art tenancy management system.

Witnessing the signing were Chow and other state and Aspen representatives.

Also present during the ceremony were state Housing and Environment Committee chairman Datuk Seri S. Sundarajoo, state Local Government, Town and Country Planning Committee chairman Jason H’ng Mooi Lye, Aspen Group chairman and executive director Datuk Seri Nazir Ariff, Seberang Perai City Council (MBSP) mayor Datuk Azhar Arshad and Penang Development Corporation (PDC) chief executive officer Datuk Aziz Bakar.

Source: Buletin Mutiara

The Penang government has called on PLUS Malaysia Berhad (PLUS) to implement the Juru-Sungai Dua elevated highway project for the dispersal of the worsening traffic congestion in the area.

Chief Minister Chow Kon Yeow said the state government had raised the matter with the Public Private Partnership Unit (UKAS) of the Prime Minister’s Department in a meeting on Thursday.

He said that he was informed that UKAS had held discussions with PLUS regarding the proposed project because it saw a need to implement it.

“The project has been discussed for many years by various parties and every year the state government also submits an application and during the visit of UKAS director-general (Datuk Shamsul Azri Abu Bakar) yesterday, he informed them that they have received the issue in many meetings and the need to implement the project.

“Given that the traffic congestion is caused by the contra routes on the North-South Highway (Juru-Sungai Dua and vice versa) as well as between the Penang Bridge and Perai which lead to slow moving vehicles thus leading to severe congestion.

“The proposed construction of the elevated highway can separate the traffic flow of users on the highway as well as local users, we the state government hope that PLUS can implement it,” he told reporters here today.

Chow was met after attending the groundbreaking ceremony of the Versa condominium project in Batu Kawan developed by Aspen.

Commenting further, Chow said the traffic congestion not only affected the Perai and Seberang Jaya areas but also caused traffic problems on the Penang Bridge and the Tun Dr Lim Chong Eu Expressway and the route from Bayan Lepas and George Town city centre.

He said the situation not only affects the people’s living environment, but also has a negative impact on the industry and investment sector because it can affect their operations here.

“It is not only affecting the industrial sector but also the people who commute to the other side and part of the island and vice versa, maybe PLUS can implement the project like in Jelapang, Perak which separates highway users and local users.

“UKAS informed us that they are discussing with PLUS and so far we are not sure how the project will be implemented and what the ‘design’ is, but the state government’s stance representing the stakeholders wants PLUS to implement the project because it is happening on the PLUS Highway and its impact is felt by the people of the island, it (the project) is very urgent,” he said.

Source: Bernama

The topping-out ceremony for the GEM Residences, a collaborative luxury apartment project between Belleview Group and LTC Group, took place on Thursday. The ceremony marks a significant step towards the expected handover of keys to homeowners within the next 6 to 8 months.

Penang Housing Committee chairman Datuk Seri Sundarajoo Somu expressed the state government’s commitment to supporting developers in implementing various projects aimed at constructing diverse housing types, including affordable and low-cost housing.

“With 37 years of experience in the development industry, having been a developer myself, I understand the challenges developers face. As a state legislative assembly member now, I am dedicated to assisting developers to ensure smooth project execution and create more employment opportunities,” he stated during his visit to the topping-out ceremony for Gem Residences.

Belleview Group managing director Datuk Sonny Ho Kiong Chan acknowledged the unprecedented challenges faced by various sectors, including the construction industry, during the outbreak of the COVID-19 pandemic. He emphasized that the industry experienced a halt in construction activities during lockdowns over the past four years.

“At this critical juncture, we have managed to overcome these challenges, primarily due to the unwavering support of our business partners, contractors, bankers, consultants, appraisers, real estate agents, and the dedicated management and staff of Belleview Group and LTC Group. This collective support gives us the confidence to navigate through adversities,” Datuk Sonny Ho Kiong Chan remarked.