Property Market Moderated In First Half 2006
Bernama 19/10/2006

KUALA LUMPUR, Oct 19 (Bernama) -- The Malaysian property market moderated in the first half (HI) of 2006 despite supportive government policies and measures, announced in Budget 2006, to mitigate the contraction in the construction sector.

According to the National Property Information Centre, (NAPIC), Valuation and Property Services Department, the property market activities saw a 4.1 percent decrease in volume of transactions with 131,321 transactions worth RM28.81 billion for HI 2006 compared with 136,940 transactions in H1 2005.

The volume also declined 5.9 percent from 139,568 transactions in H2 2005, the ministry noted in its "First Half 2006 Property Market Report" released today.

However, the value of transactions increased by 1.4 percent and 1.6 percent compared to H1 2005 (RM28.42 billion) and H2 2005 (RM28.36 billion) respectively.

Compared to H1 2005, all sub-sectors recorded a slowdown in market activities with the industrial sub-sector registering the highest decrease of 9.7 percent, followed by the agricultural and development land sub-sectors at 6.6 percent each.

The value of transactions for the three sub-sectors, however, increased by 1.5 percent, 22.2 percent and 22.9 percent respectively, the ministry said.

Similarly, volume of transactions for all sub-sectors recorded decreases against H2 2005, except for agricultural and development sub-sectors which experienced increases of 3.8 percent and 0.3 percent respectively.

The turnover rate, which measured the ratio of total transactions to total inventory in the country, also recorded slight decreases for the residential, shops and industrial sub-sectors.

According to the report, the turnover rate for the residential sub-sector in H1 2006 was 1.4 percent compared to 1.5 percent in H1 2005 and 1.6 percent in H2 2005.

The turnover rate for shops was 1.7 percent compared to two percent in H1 and H2 2005 while for the industrial sub-sector, the turnover rate was 1.9 percent compared to 2.1 percent in H1 2005 and 2.2 percent in H2 2005.

But values, on the other hand, were mixed, the ministry said.

The residential and commercial sub-sectors registered decreases of 6.5 percent and 11.1 percent respectively.

Conversely, the development land sub-sector recorded the highest increase of 36.5 percent, followed by agricultural sub-sector at 29.3 percent and the industrial sub-sector at 8.6 percent.

Based on the report, the residential property sub-sector dominated 64.8 percent of the total transaction volume, followed by agricultural at 19.4 percent, commercial at 8.9 percent, development land at 4.2 percent, and industrial sub-sector at 2.5 percent.

Likewise, residential sector contributed 47 percent to the value of transactions.

The commercial, development land, agricultural and industrial sub-sectors each formed 18 percent, 15 percent, 10.8 percent and 9.1 percent respectively of the total transaction value.

-- BERNAMA