The past twelve months have been a very hectic and exciting period for REHDA in particular having to face the various external and internal economic, political and legislative challenges. Whilst no immediate impact is felt as yet from the European sovereign debt crisis, the still uncertain American economic stability and the extensive Arab Spring citizens’ unrest, our country needs to be vigilant and prepared for further deterioration in civil and social conditions in these countries to prevent an adverse ripple effect. Within the country, Malaysia has performed well achieving a 5.1 % GDP growth for 2011, although consensus economic forecast for 2012 is as much as 1% lower than the previous year. As the 13th General Election has to be called before April 2013, predictions are that Parliament may be dissolved before year end and until a fresh mandate is obtained for the ruling government, there is a sense of anxiety and unwillingness by the populace and investors to make firm and large financial commitments.
Despite the external headwinds and some of the credit tightening measures such as the 70% loan cap on margin of financing for a third property purchase and more stringent lending criteria as required under Bank Negara Malaysia’s responsible lending guidelines issued to consumer banks, the property sector has generally done well. The recent NAPIC property market report by the Ministry of Finance has shown that the number of transactions in 2011 has increased by 14.3% as compared to 2010 while the value has increased by 28.3% from RM107.44 billion to RM137.83 billion in the same period. This upward trend is vindicated by REHDA’s very own Property Industry Survey which was released in late January 2012 revealing that the second half of 2011 has shown fairly robust demand matched by a healthy pipeline of property launches by REHDA members. It is noted from the survey that the market is still driven by domestic buyers with a significant number of first time purchasers for own occupation. A pertinent point when analyzing the Government’s property report shows that roughly two thirds of the estimated RM 62 billion residential transactions is attributable to the secondary market. This suggests that two thirds of residential property buyers choose the “Build Then Sell” properties by buying completed pre-owned/occupied housing stock instead of the newly built via the “Sell Then Build” method. The fact that these 2 options are available is democratic and healthy for the market as it presents the consumers a choice in their investment decision.
As we continue to advocate for the property industry and serve the country to ensure that the nation’s housing agenda will be accomplished, the industry continues to face challenges of escalating development costs particularly building materials, labour and land. Developers find it difficult to match house buyers’ affordability having to deal with the tremendous cost push factors such as the various compliance requirements involving financial contributions, surrender of land, imposition of quotas both for low cost housing and Bumiputra units, provision for infrastructure and amenities as well as onerous imposition of upfront payments that forced industry players to adjust property prices to ensure a fair return on their investments. REHDA has and will continue to dispel the perception that developers are making abnormal profits as well as convey the industry’s predicament to the Government that it is timely to review the various conditions imposed.
Going forward, the property market would continue to play a prominent role in the economic and social well being of the nation. Malaysia with its growing population and young socio-demography needs a constant stream of supply of housing of all types to meet the demand of first time home owners, up graders and to a smaller extent, the investors. It is the joint responsibility of the Government authorities to facilitate seamless and speedy approvals to prevent bottlenecks in the supply pipeline and the developers to conduct higher quality market research and forecasts to ensure the right mix, type, pricing and appropriately located properties are built to avoid mismatch and possible abandonment. The latter step is imperative particularly for developers in the land starved conurbation of Greater Kuala Lumpur and Klang Valley as the Government would be ensuring more supply by unlocking development lands and rights by releasing lands such as the Sungai Besi Air Base, the International Islamic Finance Centre, the RRIM land, the air rights above MRT stations and the River of Life project. The Government is also embarking on the development of PR1MA and My First Home Scheme to deliver affordable housing to the masses. Take-up is expected to be steady as under the Economic Transformation Programme, the population of the Klang Valley is projected to increase to 10 million by 2020 with the average per capita income raising to US$15,000 from US$7,000 in 2010.
Behind the scene, the REHDA National Council, Exco and the various committees have been tirelessly working and being engaged by the various Ministries and Government agencies to debate, argue and consult on Acts, Legislations and matters ranging from amendments to the Housing Development (Control & Licensing) Act 1966, proposed Strata Management Act 2012, Strata Titles Act 1985 (Amended 2012), National Housing Policy, Build Then Sell delivery system, abandoned housing projects, CIDB Act, CIPAA, IFRIC and various issues as highlighted within this Annual Report. We continue to work with our peers and other NGOs such as members of BIPC, ABM, SHAREDA, SHEDA, FOMCA, BMDAM, FIABCI and the like for the betterment of the Industry.
With respect to the recent media highlights on the 195 unlicensed developments, it is worthy to note that the Chief Secretary to the Government (KSN) is not solely blaming developers for causing housing abandonment problems. Other related professional bodies too have been reprimanded for contributing to the mess .As a responsible Association, REHDA definitely does not condone any non-compliance to the development laws. REHDA is working very closely with the Government and participating actively in the Task Force on Reviving Abandoned Projects, chaired by the KSN himself not only in providing feedback but also in reviving projects, undertaken by REHDA members. We have also taken steps to raise the bar in terms of corporate governance and discipline by terminating memberships of our very own members recently who were found to have been involved in unlicensed development.
I would like to convey my appreciation not only to all those members particularly of the various working committees who represent REHDA in engaging and resisting changes that are unfavourable to the industry and look forward to more support from other members as oftentimes such frequent meetings are called by the Government at short notice. Thanks also to the Secretariat staff for their diligent support and preparation of research and facts for REHDA representatives to argue its case better at forums, meetings and workshops. Whilst not taking any credit from the aforementioned REHDA heroes, I would like to highlight the role of REHDA Youth for their continuing enthusiasm in flying the REHDA flag high by successfully executing visible media profile events such as the Green Tours, its “Show and Tell” series and its CSR and charity initiatives. Special mention must be made of the contribution of the REHDA Building Committee ably and jointly chaired by Yang Berbahagia Tan Sri Datuk Chan Sau Lai and Yang Berbahagia Dato’ Ricque Liew and also the Fund Raising Committee headed by Yang Berbahagia Datuk Eddy Chen Lok Loi and the efforts of other past Presidents such as Datuk Ng Seing Liong and Dato’ Jeffrey Ng would without whom the realisation of our new Wisma REHDA would just be a dream. Special Thanks also goes to Yang Bahagia Dato’ C Q Teo and Mr Ong Keng Siew and the Board of Directors of Paramount Corporation Berhad for consenting and supporting this project by seconding their Project Management team ably led by Dato’ Ricque Liew and Mr Prasanth Vijayan to manage the project. The attractive, well built and green Wisma REHDA is a building we can all be proud of and bears testimony to the strength and pride of REHDA members. This bold and decisive move to embark on this new REHDA National Headquarters is indeed courageous and visionary. The building is completed well within the budget with savings against the original costings attributable to a combination of higher than expected cash contribution and donation in kind from members and building material suppliers. Heartfelt thanks go to all these generous individuals and companies and we look forward to more donations in cash or in kind for such items as artwork, tapestries, artifacts and equipment from other members.
As we cast our eyes proudly to the state of the art Wisma REHDA, we must not forget that the “hardware” is only a housing for the heart and soul of an organization. As members of REHDA, we must strive for a higher standard of recognition, continuous improvements in corporate governance, better quality product and service delivery to satisfy our customers and most of all contribute towards nation building. We must live the culture of being Responsible, Responsive, Respected and Relevant developers focusing on sustainable development objectives. We look forward to your continuing transformation and support.
With best wishes and warmest regards.
DATUK SERI MICHAEL KC YAM SMW, DSNS
PRESIDENT, REHDA MALAYSIA