EcoFirst to tap into shortages of affordable homes

PETALING JAYA: In a move to tap into shortages of affordable residential homes in Malaysia, Ecofirst Consolidated plans to have a majority of its new property launches priced below RM500,000 per unit.

In a statement, the boutique property developer said it remained cautiously optimistic about a gradual recovery in property development as Malaysia moves out from a pandemic to an endemic stage.

CEO Datuk Tiong Kwing Hee said the outlook for the property sector in 2022 remains challenging amid the adverse impact from the Covid-19 pandemic in Malaysia.

“I believe the residential market will gradually recover in the second half of 2022, but prices will remain flattish despite the rising raw material prices.

“However, if the economic recovery picks up faster than anticipated, there will be pent-up demand in the property sector.”

EcoFirst said Malaysia continued to see a demand-and-supply mismatch and an overhang in its property market.

Based on market observations and studies, a lot of the unsold residential units in Malaysia are priced between RM500,000 and RM1.5mil, while unsold residential properties priced below RM500,000 are usually those located in the outskirts, it said.

This explained the overhang situation despite the shortage of affordable residential homes.

According to the Housing Bureau Statistics, Malaysia is still in need of affordable residential homes with a shortage of one million units. Most of these shortages are around the Klang Valley.

“EcoFirst is market-driven and only concentrates on prime location development and we are price-sensitive.

“We’re aware of the changing market trends and landscape in the country and are flexible to make the right adjustments to promptly focus on the current segmental needs and demand,” Tiong said.

Tiong added that the group was cautiously optimistic about its earnings prospects for the financial year ending May 31, 2022 (FY22), as EcoFirst focuses on developing high-value land in strategic areas, with attractive pricing and development features tailored to the requirement of the mass-market segment.

A recovery was expected after the group slipped into a net loss of RM2.1mil for the first quarter of FY22. The net loss recorded was in line with the sharp decline of 83.3% in revenue to RM2.7mil as compared to a year ago.

The group attributed the decline in its performance to the postponement of new development launches and no revenue from the property development segment due to the Covid-19 pandemic.