GOH SOO SING
Managing Director, BÃ–N Estates
Whatâ€™s your outlook for the local property market in 2018?
The property market is in a consolidation mode this year, especially with the new controls by Putrajaya on commercial and residential developments priced at MYR1 million and above. Adjustment of Base Rate (the main reference rate for retail floating rate loans) from Bank Negara Malaysia will also notably affect the lending patterns. However, approval rates have gone up from the banks, indicating their support for property purchases. We will also be seeing more genuine buyers rather than speculators. Therefore, my outlook for the market relatively positive although sales may be subdued.
Despite numerous doomsday predictions of a burst in the property market through the years, it has yet to happen. However, we do see that the market is continually softening. Whatâ€™s going on?
Property prices have been relatively flat for the last three years. If we peel back the layers and look deeper into this issue, the source of the problem is a great mismatch between the supply and demand of the types of properties available and their price points. Prime examples would be the oversupply of offices and residences in the KLCC area and the empty homes in Iskandar Malaysia. The problem is then exacerbated by the lack of economic development around the area and property prices are affected when there are no employment opportunities. A study of population needs and affordability is crucial to support capital appreciation.
Following that, what would you say are the needs of the market when it comes to property right now?
Weâ€™re definitely seeing a trend where units are getting smaller due to land prices in urban centres. But, when it comes to choosing a home, buyers want a space that is convenient and provides a valuable experience to their lives â€“ and this is something that weâ€™ve picked up on. We study the supply and demand in the market first before selecting a segment to position our product in. It starts with land banking â€“ selecting a location thatâ€™s in high demand with great growth potential. Thereafter, we cater to the buyer profile for that location based on research studies of the affordability rates.
As you position yourself towards the mid to luxury segment, how has the recent restrictions on approvals for luxury property developments by the government affected your business?
Luxury property has been sluggish for the past few years now. Despite the volatile economic situation, we took a calculated risk in launching our flagship project, The Estate, South Bangsar, in March 2017. The Estate is a two-block, 46-storey high-rise luxury condominium with a starting price of MYR1.8 million. Construction is well underway and I am proud to share that 75 per cent of the development has been sold to date. It is a great achievement for the companyâ€™s first high-rise project and our success is banked on meticulous research of the locale as well as the product design. Weâ€™ve created a niche product in an area that is overfed with small units and this has greatly contributed to our success.
Being a boutique property developer, how does BÃ–N Estates help shape the local property market for the future?
As a boutique developer, our approach is far more personal â€“ we build with the mindset of building our own dream homes. We aim to differentiate the company by positioning ourselves as craftspeople, crafting a lifestyle, a home, that one aspires to live in. Hence our tagline: â€˜Living, Well Crafted.â€™ Our team is highly experienced but still young, dynamic and design-focused. With The Estates, we got the architects and interior designers heavily involved from the get go, and the team and I have personally gone through over 40 iterations of the layouts to create the bestpossible living space within the constraints presented. Itâ€™s about creating a product that can be built at a cost thatâ€™s financially viable to our buyers while matching their needs.
Moving forward, we are currently in the planning stages for our second project in Mont Kiara. This project will focus on smaller units and lower price points compared to our flagship. I canâ€™t say much about the development yet, but we will release more details in due time.