Economic Report 2013/2014: Construction remains robust

by **Cals** Sat 26 Oct 2013, 21:09

ublished: Saturday October 26, 2013 MYT 12:00:00 AM
Updated: Saturday October 26, 2013 MYT 9:33:18 AM
Economic Report 2013/2014: Construction remains robust
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The Klang Valley continued to dominate supply during the six-month period, accounting for 31% of housing starts, followed by Johor with 23.1%.

GROWTH in the construction sector remains robust, with value-add growing 12% between January and June, due to ongoing civil engineering and residential activities.
The total value of construction work during the first half of the year rose 13.8% to RM43.3bil, with the highest share contributed by civil engineering at 36.1%, followed by the non-residential (31.9%) and residential (27.5%) subsectors.
Overall, the sector is seen moderating to 10.6% this year from 18.1% last year following the completion of several high-impact public infrastructure projects.
Two and three-storey terraced houses, along with condominium and apartment units, accounted for 24.9% and 22.3% of the total starts.
The Klang Valley continued to dominate supply during the six-month period, accounting for 31% of housing starts, followed by Johor with 23.1%.
To bolster the supply of affordable homes, the Government introduced PR1MA, which is expected to provide 80,000 houses.

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As at the end of June, a total 20,000 houses under 15 projects were under construction in the Klang Valley, Johor, Penang, Sabah and Sarawak.
In line with the Government’s objective to provide affordable homes to the low-income group, Syarikat Perumahan Negara Bhd (SPNB) built 5,063 units of Rumah Mesra Rakyat 1Malaysia as at end-June.
SPNB is also targeting to construct 7,092 units of low and medium-cost apartments and terraced houses over the next three years.
Units from new launches dropped 45.4% to 17,105 between January and June from 31,305 during the corresponding period a year ago.
Sales of new launches remained favourable with a take-up rate of 21.8% compared with 15.6% last year.
In line with the improved demand, the property overhang declined 9.5% to 14,576 units amid better sales in the residential segment.
Following Government initiatives to curb speculative activity, the volume of residential property transactions contracted 12.6% as at June, but the value increased marginally by 1% to RM32.9bil.
House prices continued to rise, albeit at a slower pace this year.
During the second quarter, the National House Price Index moderated to 7.8% from 11.2% last year, with eight states showing increases, namely Johor, Kelantan, Sarawak, Malacca, Kuala Lumpur, Penang, Sabah and Kedah.
The average all-house prices in Malaysia were at RM257,605, with Kuala Lumpur in the lead at RM605,711, ahead of Sabah, Selangor, Sarawak and Penang.