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SENTIMENT in Malaysia's real estate market may be soft, but even ponying up a generous premium may not be enough to tempt owners to sell their prized assets if these are in popular areas.
Take the upmarket suburb of Bangsar. An owner of a two-storey shop lot in the main Telawi area there had asked for RM7.7 million (S$2.9 million) for the property, which had been valued at between RM5.5 million and RM6 million. The prospective buyer agreed to pay the 40 per cent premium, but the Singapore owner of the unit then changed his mind, recalled Nixon Paul, the immediate past president of the Malaysian Institute of Estate Agents (MIEA).
Another property, a 5,500 sq ft bungalow, was valued at RM7 million, but even an offer of RM10 million could not persuade the owner to sell it.
Mr Nixon, speaking at the MIEA's Property Market Outlook 2015 in Kuala Lumpur on Tuesday, said: "So yes, the market is slow, but not in all areas. It is selective."
In essence, there are hardly any sellers in the Klang Valley's older established suburbs such as the commercial hotspots of Damansara Utama, SS2, Taman Tun Dr Ismail and Sri Hartamas; in the Bukit Bintang tourism belt, the same is true.
"These prime locations are doing well in rental and sales. There is strong pent-up demand, but supply is scarce."
Sales are moving slowly in up-and-coming but less established areas such as Kota Damansara, where several new shop houses are on the market. Mr Paul said he expects prices to grow by 5 to 10 per cent annually in prime locations, but remain flattish - at least this year and maybe the next - in less popular spots.
However, the MIEA generally expects prices to continue heading north because there is so little development land left in the Klang Valley.
MIEA deputy president Erick Kho said that land prices are projected to breach RM4,000 per sq ft (psf) soon in Kuala Lumpur's prime KLCC area. Prominent land deals there have gone from RM1,385 psf in 2010 to more than RM2,000 in 2012 and to around RM3,300 last year.
Because supply is limited, land owners are taking their time to make land available. "If you are waiting for prices to come down, you will have to wait a very long time," MIEA president Siva Shanker declared.
But the gap between sellers' asking price and what buyers are willing to pay is narrowing, he said, adding that buyers might get a break if speculators who purchased on easy financing schemes in the last few years decide to offload their soon-to-be-delivered units at prices that are only slightly more than they paid for them, or perhaps even slightly less.
For now, most owners appear to be keeping to their loan schedule.