Mah Sing sees race for properties ahead of GST

By BUSINESS TIMES
KUALA LUMPUR: Mah Sing Group Bhd expects a scramble for properties in the second half of this year, ahead of the Goods and Services Tax (GST) implementation next year and inflationary fears.
Executive director for corporate and investment Datuk Steven Ng Poh Seng said people will continue to buy houses post-GST.
“They will also look at properties as an inflation hedge,” he told a press conference at Invest Malaysia, here, yesterday.
“House prices are not going to correct. There will be a push factor because of GST and inflation. People will chase after properties. They will also buy because of the need to own a home.”
Ng expects house prices to increase by between five and 10 per cent this year and next.
In 2012, house prices rose by 11.8 per cent while last year, they rose by 11.6 per cent.
“Last year, building material cost rose by three per cent. This year, the cost has increased by one per cent because of higher electricity tariff.”
According to Ng, all costs will be passed down to buyers.
Mah Sing has gross development value (GDV) and unbilled sales of RM33.9 billion that will sustain the group for seven to eight years.
Of the remaining GDV (RM29 billion) and unbilled sales (RM4.6 billion), residential properties make up 71 per cent, commercial (28 per cent) and industrial property (four per cent).
Mah Sing is launching RM4 billion worth of properties this year and the anticipated take-up rate is 90 per cent, Ng said.
Group managing director and chief executive Tan Sri Leong Hoy Kum is upbeat that the group will record a compounded annual growth rate of 25 per cent for the next five years.
“It’s all about having properties in choice locations which are reasonably priced. We are focusing on launches where 87 per cent of the properties are priced below RM1 million each,” he said.