Number Of Unsold Residential Properties Increases By 48%
The number of completed unsold residential properties in Malaysia has jumped 48% since 2017. A report from the Valuation and Property Services Department (JPPH) shows that there were 40,916 unsold units as of 30 September 2018.
For the most part, the unsold units were mainly serviced apartments and SOHOs. Without them, there would only be 30,115 unsold units.
The JPPH provided a variety of reasons that these could be the case, including situations where developers deliberately build smaller apartments to fit more units into the same amount of land. Also factoring into the issue are higher serviced charges due to local authorities converting land to commercial status (to extract higher land premiums).
Overall, this has lead to a total overhang value of RM27.38 billion. Without the serviced apartments and SOHOs, the value would only be RM19.54 billion. Curiously, Kuala Lumpur does not have any unsold serviced apartments or SOHOs.
An overhang is defined as premises that have been completed and received its certificate of fitness from local authorities, but has not been sold for nine months.