Developers struggling to sell their Bumiputera units should try using promotions and property exhibitions to attract buyers, before asking for a release mechanism on the unsold units, according to Shikin Taib, Managing Director of MMC Sdn Bhd.
"They should advertise in Malay and English newspapers and embark on other promotion measures. If not, they would be stuck and there will be property overhang," said Shikin in a report by Business Times Malaysia.
Based on a research conducted by the Real Estate and Housing Developers Association Malaysia (REHDA), Bumiputera allocation is the top cause of property overhang. Moreover, developers are complaining that unsold Bumiputera units are reducing their profit margin.
"They are getting an average 30 percent profit margin from each development. Their margins would be affected if they don't sell the Bumi lots at the beginning of the project," noted Shikin.
Shikin's company, MMC, was the organiser of the Bumiputera Property Exhibition (BPEX 2012) held last weekend. It showcased RM1.5 billion worth of properties, mostly situated in the Klang Valley.
Around 42 property developers took part in the exhibition, including Equine Capital, Melati Ehsan, Glenmarie Properties, The Lion Group, Glomac, MK Land and PKNS. Prices of the properties range between RM99,000 and RM8 million.
The exhibition is expected to sell around RM100 million worth of Bumi lots, up 40 percent from last year's BPEX.
Image: 228 Selayang
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