Big market for student hostels

TOKEN OF THANKS: RHB Bank Berhad's head of strategic programmes, planning and projects division and head of East Malaysia and Brunei, Datuk Ahmad Ibrahim (centre) present a souvenir to Johari while Sheda president William Wei (left) looks on. KUCHING: The government and property developers have to form more aggressive strategies this year to deal with a potentially easing property sector, with student hostels for institutes of higher education high on the list of potential new markets, said Minister of Housing Dato Sri Abang Johari Tun Openg. Speaking at the Sarawak Housing and Real Estate Development Corporation (Sheda) "Sarawak Property Report/Market Outlook 2007" yesterday, Johari reminded developers not to jump into new projects with a "herd mentality", which was typical in Asia, without conducting market research or studying other lucrative opportunities. Citing strategic examples from Australia, Johari said developers erecting apartment buildings should design the buildings in such a way to allow conversion to student hostels. He foresaw a jump in demand for student housing for those studying at Swinburne, Universiti Malaysia Sarawak (Unimas), and Sarawak Biodiversity Complex. "We have to be more aggressive in strategic formulation this year ... developers must find new market opportunities," he said, adding that working and completing infrastructure - such as nearby schools, transportation services and utilities - was also extremely important to the success of housing projects. As for government action, Johari said the plan was to attract more overseas students to come to study here at the existing institutes of learning and the Sarawak Biodiversity Complex, which would in turn increase the population and market demand. Meanwhile, this year property prices for prime and up-and-coming residential areas are expected to remain stable or to increase marginally while prices overall are not expected to come down anytime soon, according to Wong Ing Siong, managing director of CH Williams Talhar Wong & Yeo Sdn Bhd. He predicted that the public could expect a continued slack in sales performance, fewer new launches, more re-launches and more promotional packages as developers try to recoup and sell excess units in the face of short-term economic fluctuations and the uncertainty of oil prices. "Oil analysts have predicted that by the year end, oil price could rise to near $100 per barrel... and to $150 per barrel within the next ten months. High levels of non performing loans (NPL) and consumer credit default will also caution banks to be more selective in lending," he said. On the upside, low-medium-cost and medium-cost housing was likely to remain in good demand, while developers are advised to identify potential areas and build up land banks for the future, which holds good long-term prospects. "Long term prospects are good due to a young housing market full of potentials... growing population, increase in households and improved wealth and lifestyle," he said. Interest rates would be expected to remain at the current level of base lending rate of 6.75 per cent for this year, while the takeoff of the Ninth Malaysia Plan anticipates funds pouring in for infrastructure, utility and rural development for Sarawak, and not forgetting buoyant consumer price index and good timber prices in the world market, he said. Sarawak's property market demand for low and low to medium-cost housing from 2007 to 2025 is said to be 15,200 units every year, with some 5,000 in residential areas of Kuching, he said

Source from: The Borneo Post, 2007-03-02 Author: Jamie Wang