Tapping affordable homes below RM500k a game changer for EcoFirst


DISHING out affordable residential homes priced below RM500,000 per unit at appealing locations is what boutique property developer EcoFirst Consolidated Bhd has in the pipeline for the immediate future.

Based on market observation and study, a lot of unsold residential units in Malaysia are priced between RM500,000 to RM1.5 mil while unsold residential properties priced below RM500,000 are usually those located in city outskirts. 

This explains the property overhang situation in Malaysia 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. 

Ironically, most of these shortages are synonymous with the Klang Valley region. 

“EcoFirst is market-driven, only focuses on prime location development and we are price-sensitive,” envisaged EcoFirst’s group CEO Datuk Tiong Kwing Hee.

“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 market segmental needs and demand.”

According to Tiong the group engages with independent market study providers to gauge the demand-supply dynamics of the location, products and branding before the drawdown of EcoFirst’s bridging finance and subsequent launching of new development projects. 

He noted that the group is cautiously optimistic about earnings prospect for its financial year ending May 31, 2022 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. 

“While the residential market will gradually recover in the 2H 2022, prices will remain flattish despite rising raw material prices. However, if the economic recovery picks up faster than anticipated, there will be pent-up demand in the property sector,” projected Tiong.

“We’re also cautiously optimistic about a gradual recovery in the property development as Malaysia moves out from a pandemic to an endemic stage.”

This comes after the group slipped into a net loss of RM2.1 mil for its 1Q FY5/2022 ended Aug 31, 2001. The net loss is in line with the sharp decline of 83.3% in revenue to RM2.7 mil as compared to a year ago. 

According to a filing with Bursa Malaysia, the decline in EcoFirst’s performance was mainly due to the postponement in the launching of new development and that no revenue from the property development segment was recorded. 

Despite the sharp decline in earnings, the group’s balance sheet remains relatively stable with net asset per share stood at 42.16 sen per share as of end-August as compared to 44.31 sen as of end-May.  

At the close of today’s trading, EcoFirst was unchanged at 39.5 sen with 395,000 shares traded, thus valuing the compAny at RM441 mil. – Oct 27, 2021