Saturday January 19, 2013

Property prices in laggard Perak not expected to drop


There is a healthy demand for homes that fit the criteria of modern families in Ipoh. There is a healthy demand for homes that fit the criteria of modern families in Ipoh.

PRICES of properties are not expected to drop in Perak this year despite being a laggard in the past years.

Experts in the field, however, feel there is potential for a 30% increase in prices in the next few years.

Real Estate and Housing Developers Association Malaysia (Rehda) Perak branch chairman Datuk Francis Lee says Perak property prices have been lagging, in particularly in Ipoh.

He says that in the past two years there has been a 30% hike in property prices, and foresees an additional 30% increase in the next few years.

Lee says this will bring property prices in Perak closer to those of urbanised states in Peninsular Malaysia.

“With the current cost of land and increasing cost of housing delivery, it is not possible for housing developers to deliver at current pricing,” he says.

Referring to the Property Market Report 2011 by the Finance Ministry, Lee says the average transacted price for housing properties in Perak in 2011 (in both the primary and secondary markets) was at RM122,275.

He says Perak was ranked 10th, ahead of Perlis, Terengganu and Kelantan.

“Although transacted housing property prices had increased by 29% from 2010 to 2011 (from RM94,757,000 to RM122,275,000) the prices of houses in Perak are still lagging.

“The prices are expected to only invariably move up in the coming years,” he adds.

Lee says the development of brownfield areas within the metropolis of Ipoh has provided a fast-changing skyline in the city.

He hopes that the “Special Area Plan” by the Ipoh City Council will provide incentives for the redevelopment of the brownfield areas.

“The potential growth areas in Ipoh are Meru, Simpang Pulai, Pengkalan, Lahat, Tambun and Klebang,” he says.

Oriental Realty agent Gladwin Agilan says he does not foresee a drop in prices as lately a couple of new developments have been launched in Ipoh.

He says these are mainly condominiums with initial prices of RM430 per sq ft and above.

“The trend will have an effect on landed properties in the vicinity, and also set a yardstick on future prices.

“The average condominium prices in Ipoh is between RM250 and RM320 per sq ft, with the exception of luxury condos launched last year,” he adds.

Gladwin, who is the head of the sales division, says most of the purchasers in Ipoh are up-graders or second homeowners, and not speculators.

He says there is a healthy demand for homes that fit the criteria of modern families, such as gated and guarded communities, clubhouse and other innovative features.

“For example the Le Green three-storey link homes, launched recently by Energiser Properties Sdn Bhd, is probably the first link-home in the country equipped with a private lift,” he adds.

Gladwin says new condominium projects within the city limits are scarce.

“However developers are filling the void with new projects catering to such needs.

“For example, the upcoming Emerald Capital project near Jusco Kinta City in Ipoh Garden is expected to be linked with shops and retail outlets,” he adds.

He adds that more residential areas, malls, schools and other public amenities are being built north of Ipoh between Tasek and Chemor.

This, he says, seems to be an attractive option for new homeowners and those seeking to upgrade to better locations.

“The other current popular areas are Meru Raya, which has the infrastructure and amenities of a modern city, as it's earmarked as a state administrative centre,” he adds.

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