Is 2016 the best time to buy property in Penang?
Penang is around the half of the size of Singapore with majority of Chinese population, followed by Malay and the Indian population. Penang’s land is divided into two by the sea: the mainland and the island. For a brief introduction, due to the scarcity of the island’s land and high-ended malls, the island is a more preferable choice for investor. The island, Pulau Pinang has the highest human density in Malaysia. On the other hand, the mainland is an option for affordable housing.
The property market in Penang has plunged by nearly half since it last peak at 2011.
According to Michael Geh, a senior partner at Raine & Horne Malaysia,
“The market recorded total transactions of 9,667 in the last quarter of 2011 which is the highest number of transactions in the past four years before it saw a drastic drop of about 48.47 percent in the first quarter of 2012 to only 4,981 transactions.”
The average transactions on residential properties in Penang is considered as the lowest in past decade, indicating the cooling of the island’s property market. Nevertheless, 2015 was a smooth beginning for first time home buyers with various affordable housing coming up that is foreseen to be completed by 2018. Those properties ranged from RM200k onwards and strategically located within cities such as Georgetown and Sungai Ara.
Similarly, in 2016, due to cooling measures and the bleak economic situation and anticipation of affordable housing, the residential property market will remain in an over-supply situation. The bleak economic and cooling measure make the market looks less promising. In addition with the implementation of Good Service Tax (GST), weakened ringgit and other factors have caused a slight drop in the property value which ironically, reflects a fairer market according to some experts.
In contrast, some experts think that the current distress market is a best time to grab good deals. As long there are sufficient background research and knowledge, this may be an excellence time for purchase. A decreased in buyers will cause sellers to sell their property at lower price.
According to Kevin Singham, the Director of Reapfield Properties (PG) Sdn Bhd, he stated that the property market to pick up in 2016 as after investors and purchasers adapt to the current market situation, business will be back as usual despite they will be more cautious in looking the right properties. He expressed his thought that 2016 is a better year for the industry than the previous year. He pointed out the emerging hotspots in the mainland would be at Perai, Simpang Ampat and Tambun.
Furthermore, with the Penang Master Transport Plan which connects Penang with an integrated system that may complete in 2017, will make a Penang a better place for investment.
On a side note, the purchase of converted heritage buildings may be profitable as Penang is crowned with the name “Pearl of the Orient” with several heritage buildings. In 2008, George Town is inscribed in UNESCO World Heritage Sites which means those converted heritage buildings may gain avenue from the tourism.
Written by : Fung Chai Ying
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