PETALING JAYA: Residential property launches in the first half of 2023 plunged 50.2% to just over 16,000 units from 33,205 units in H1 2022, said the National Property Information Centre (Napic).

Compared to the second half of 2022, residential launches in the first half of 2023 were down by 20.9%.

These statistics paint a rather bleak picture for the property market, especially the residential property segment, Napic’s H1 2023 property market report said.

However, sales performance for new launches recorded an increase of 32.2% compared to H1 2022 of 14.6% although it was lower compared to H2 2022’s 36.8%.

In the first half of 2023, 20.7% of new residential units were priced below RM300,000, 37.3% between RM300,001 and RM500,000, 34.3% between RM500,001 and RM1 million, and 7.7% above RM1 million.

Johor had the most residential launches (25.9% of the national total), with a sales performance of 34.5%. Selangor came next (18% share) with a sales performance of 38.6%, followed by Penang (9.9% share) with a sales performance of 64%.

With terrace homes dominating new launches, Napic said single-storey (3,489 units) and 2-3 storey homes (4,795 units) contributed 50.1% of the total units with a sales performance of 49.1%. This was followed by condominium/apartment units at 31% share (5,126 units) with a sales performance of 27.8%.

Napic, which sits under the valuation and property services department, said property market activity in the first half recorded more than 184,000 transactions worth RM85.37 billion. This is a 2.1% decrease in volume and 1.1% rise in value compared to the same period last year.

Overhang units decreases

On the overhang situation, Napic said a total of 26,286 overhang units worth RM18.30 billion was recorded in H1 2023, down by 5.3% and 0.6% in volume and value respectively against H2 2022.

“Most of the overhang is in Johor with 4,717 units worth RM4 billion. Likewise, the unsold under construction residential units saw a decrease of 4.9% to 54,844 units compared to H2 2022 (57,649 units),” it said.

On the same note, the serviced apartment sub-sector recorded 22,497 overhang units with a value of RM19.13 billion, a decrease of 6.2% and 5.2% in volume and value respectively against H2 2022.

“Johor recorded the highest overhang in the country with 59.4% (13,366 units), followed by Kuala Lumpur and Selangor, with 24.2% (5,450 units) and 12% (2,689 units) respectively,” it added.

Moving forward, Napic said the property market performance was “moderate” for H1 2023, despite a number of headwinds which has limited the sector’s growth potential.

“With the positive economic growth projection by Bank Negara Malaysia, expected between 4% to 5% in 2023, supported by various government initiatives and assistance, the property market performance is expected to remain cautiously optimistic,” it concluded.