KUCHING: Sarawak’s property market is said to be booming with prices of properties and houses gradually moving up as the value of property transactions increased.
Adenan looking at a property model being displayed at Sheda Property Expo 2014 at BCCK accompanied by (from second left) Zaidi, Abdul Karim, Abang Johari and Sim. — Photo by Jeffery Mostapa
Sarawak Housing and Real Estate Developers’ Association (Sheda) president Zaidi Ahmad disclosed that the demand for properties has far exceeded supply.
“Over the last few years, the property market in Sarawak has experienced a boom.
“Whilst this is good news for our economy, we cannot escape the fact that rising house prices prevent a section of our population from enjoying the privilege of owning a home.
“The public perceives that there is a property bubble in Sarawak. They cannot imagine house prices any higher than they already are.
“They cannot comprehend why middle-income or dual-income families are unable to purchase a suitably-sized familyphoto home.
“Some are of the opinion that developers inflate their prices unreasonably, gaining sizeable profit margins.
“Others are of the opinion that speculators are driving the prices up in order to benefit from a manipulated property boom in a particular area.
“The reality is actually much simpler than conspiracy theories. Demand currently outstrips supply,” he said in his speech during the opening of Sheda Property Expo 2014 at Borneo Convention Centre Kuching (BCCK) here yesterday.
Among those present at the launching of Sheda Property Expo 2014 yesterday were Chief Minister Tan Sri Datuk Amar Adenan Satem, Minister of Housing Datuk Amar Abang Johari Tun Openg, Assistant Minister for Housing and Assistant Minister for Youth Development (Urban Areas) Datuk Abdul Karim Rahman Hamzah, Assistant Minister for Housing and Assistant Minister of Rural Development Datuk Francis Harden Hollis and Sheda secretary-general and organising chairman of the expo Sim Kiang Chiok.
Citing an example, Zaidi observed that it is like an ‘impossible dream’ to some people and an ‘impossible nightmare’ to others that certain houses costing RM180,000 some 20 years ago can fetch more than half a million in some areas at the moment.
He revealed that in the early 2000s, residential supply of housing in Sarawak grew on average at approximately six per cent per annum.
Subsequently, ten years later, the growth rate has halved to an average of about 2.7 per cent per year.
“It is interesting to note that whilst the growth in volume has dropped, the correlating value of transactions have increased hence the property boom. This is a classic effect of supply and demand. “Where supply is not able to meet demand, the available supply will be able to command much higher rates than if there were no demand.
“Malaysia house price index increased by eight per cent in first quarter (this year) relative to fourth quarter 2013 but Sarawak registered only a slight increase of 1.5 per cent.
“All house price in Malaysia (on average) is RM276,000 while in Sarawak, it is (on average about) RM342,000 but the increase is only 2.7 per cent over the last quarter.
“This also represents eight times annual median income of households in Sarawak. Hence, house prices are still affordable,” he said.
Statistics have showed an incoming supply of 22,663 units of various types of houses of which 2,700 units were completed in the fourth quarter of 2013 to first quarter of 2014 as well as planned supply of 12,998 units.