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| Malaysia Real Estate Report Q4 2009 |  | Author: Business Monitor International
Publisher: MarketResearch.com
Category: Book
Buy New: $530.00
as of 9/6/2010 08:49 CDT details
Seller: Amazon.com
Format: Download: PDF
Media: Digital
Pages: 78
ASIN: B0030FKBVA
Publication Date: October 1, 2009
Availability: Available for download now
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| Editorial Reviews:
Product Description
The global economic recession has caught up with Malaysia, with the economy contracting in Q109 forthe first time since 2001 as exports slumped, pushing the nation toward its first recession in a decade.
The economy, the third largest in South East Asia, shrunk 6.2% year-on-year (y-o-y) in Q109 after 0.1%growth in Q408.
The news has had a clear impact on the country’s real estate market, which was already facing a potentialoversupply in the office sector. Rental rates have been falling with fewer new clients able to drive harderbargains and existing occupiers renegotiating.
Kuala Lumpur’s prime office market is experiencing declining rents for the second consecutive quarter.
In Q109 rental rates fell 2.85% quarter-on-quarter (q-o-q) to MYR6.14 per square foot (ft2) per month.However, DTZ reports that occupancy rates for grade A offices in prime locations are holding up, at anaverage of 95%.
New office space coming on stream, combined with a fall in demand due to the recession, is likely tocause rents to drop further. In all, a total potential supply of about 4.13mn ft2 of prime office space will becompleted in 2009. Growth is not expected until at least 2010.
House prices appear to have fallen some 4% since the end of 2008. The high-end condominium market issoftening, but to date there has not been a spate of ‘fire sales’. The total supply of high-endcondominiums in Kuala Lumpur has increased approximately 22%, bringing the total cumulative supplyto about 17,230 units by end of 2008. The increased supply adds to the general softening of the marketdue to the recession.
There are also regulatory and tax issues hanging over the market at a difficult time. House buyers andowners have joined construction players in asking the government for an exemption, or at least a delay, tothe imposition of a new stamp duty on construction contracts. Stamp duty was increased from January 12009 from the nominal MYR10 to a 0.5% of the contract value, causing construction costs to go upbetween 1% and 2%.
These factors suggest the housing sector will continue to soften for the rest of 2009, with somestabilisation to be expected in H110.
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