PENANG dismissed the assumption that there is a glut of housing projects in the state, said state executive councillor for housing, Datuk Seri S. Sundarajoo, who clarified that this only affected the high-end segment of luxurious properties.
He said this was because developers were struggling to sell such units while there is robust demand for affordable units below RM400,000, he said.
He believes that those who are complaining of a glut, may have a hidden agenda, which is to camouflage their inability to market the sale of top end units.
"The waiting list for affordable housing in Penang continues to grow. We are trying our best to meet the demand, especially for those with government subsidies," said Sundarajoo.
He admitted that a glut may prevail over high medium cost to high-end properties but this is something which has persisted over time due to factors such as sentiments and location
The Real Estate and Housing Developers' Association (REHDA) in its outlook indicated that the property market including in Penang, remained sluggish in the first half of this year.
REHDA highlighted a consistent mismatch between supply and demand among buyers for all brackets.
Datuk N.K. Tong, REHDA's immediate past president, said unsuitable locations and price-income gaps were the primary reasons behind unsold units.
“Under current rules, developers must allocate up to 50% of units for affordable housing regardless of location. While the policy is well-intentioned, this blanket approach often disconnects supply from demand,” Tong explained.
Data from the National Property Information Centre showed that affordable homes made up 20.7% of Malaysia’s unsold units in Q1 2025—the largest category of residential overhang.
REHDA reiterated its call for the revival of the Home Ownership Campaign to stimulate demand and reaffirmed its members’ commitment to delivering quality, and affordable housing.
Property executive Adrian Loke said that in Penang, it has become a buyers rather than a sellers' market.
Contrary to the past decade where Penang was noted as a place for property investment, the current momentum has slowed down in tandem with the uncertainty in the global economy, worsened with the US insistence on import tariffs.
Loke said the state needs to device new ways to stimulate the market or allow a natural market correction to take place by halting development until the overhang can be reduced. - October 18, 2025
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