The current promotion campaigns are not as effective as they should be, according to Knight Frank Managing Director Sarkunan Subramaniam.
He was referring to lucky draws, free gifts and campaigns with taglines such as “Voluntary Exit Plan”, “Buy Now Pay Later” and “Rent First Buy Later”.
Last month, the National Property Information Centre (Napic) said 23 per cent of the 81,894 units of residential and commercial properties launched in the first quarter of 2016 had yet to be sold.
These unsold properties are valued at RM9.4 billion. This was an increase of 15.9 per cent from the value of unsold units in the fourth quarter of last year.
Sarkunan said the current offer of various incentives to attract buyers was prompted by uncertainties in the local market and world economy.
“But the property market is still not picking up,” he said at the Asli National Housing & Property Summit here yesterday.
He suggested stimulating sales by offering loans with low monthly instalments to young adults.
“Young adults will gradually have a pay hike later on, and future instalments can then be higher,” he said.
At present, 50 per cent of young adults could not get bank loans, he noted.
Sarkunan said developers could also add electrical points and water outlets and offer renovation services and furniture at cheaper prices.
He also suggested the reintroduction of the Developers Interest-Bearing Scheme (DIBS) for first-time house buyers.
Under DIBS, a property developer would absorb the interest on home loans during the construction period.
Siva Shanker, who heads the Malaysian Real Estate Investment Trust Managers, supported the idea of applying the scheme to benefit first-time buyers.
He also said more buyers should opt for homes in the suburbs.
He said that in 10 years’ time, places like Semenyih, Banting and Port Klang would not seem as far away from Kuala Lumpur as they were now because connectivity would have improved.
“These are the growth areas,” he said.
Siva acknowledged that the current housing slump looked bad, but he expressed optimism that the situation would improve over the next few years.
He proposed that the government relax rules for foreign buyers as a way to stimulate property sales.
At present, foreigners cannot buy homes that are priced below RM1 million.
Daniele Gambero, Chief Executive Officer of the REI group of companies, cited a study that found that 60 per cent of the young did not mind staying away from the city.
“They want a place that is safe, affordable and well connected,” he said. “If the developers could package their homes that way, people would want to buy homes outside the city.”
In the city, he said, developers were building more studio homes to entice the young because these homes were relatively cheap.
Studio units in the capital city are being sold at RM300,000 and above. This compares with RM500,000 and above for a two-room or three-room condominium unit.