Luxury homes contribute little to property overhang, says developer

 Paramount Property Group CEO Jeffrey Chew says demand for luxury homes remains strong among international buyers.

Paramount Property Group CEO Jeffrey Chew (third from left) and Mitsui Fudosan (Asia) Malaysia managing director Masayoshi Saito (third from right) at the signing of the joint venture.

KUALA LUMPUR:

A property developer says luxury homes are not contributing significantly to the overhang in the Malaysian real estate market.

Paramount Property Group CEO Jeffrey Chew said conditions that worsened slightly last year involved “a different segment”.

“Demand remains strong in high-end segments,” he told reporters after announcing the group’s joint venture with Japanese real estate company Mitsui Fudosan here.

According to a report by the National Property Information Centre, released in September, the number of unsold completed homes increased by 8.6% between the second half of 2025 and the first half of 2026.

About 37.3% of the 33,094 unsold homes were priced below RM300,000, while luxury homes priced above RM1 million accounted for 9.5%.

Chew went on to say that the overhang in luxury homes was marginal due to foreign buyers.

He said foreigners buy property in the country due to its appeal as an investment destination.

“Over the past two years, Malaysia’s profile has grown substantially.”

According to the statistics department, cumulative foreign direct investment in Malaysia has increased over the past two years, rising from RM993.9 billion at the end of 2024 to RM1.1 trillion as of the second quarter of this year.

Separately, Chew said the joint venture with Mitsui Fudosan would see the Tokyo-based real estate company acquire a 49% equity interest in Meridian Kuasa Sdn Bhd, a wholly-owned subsidiary of Paramount.

Meridian Kuasa will serve as the joint venture vehicle to undertake the development of The Ashbourne — a premium residential development with an estimated gross development value of nearly RM1.3 billion in Kuala Lumpur’s U-Thant enclave.

The Ashbourne, which comprises two towers of high-end serviced residences, is expected to be completed by the fourth quarter of 2030.

Masayoshi Saito, the managing director of Mitsui Fudosan (Asia) Malaysia Sdn Bhd, said The Ashbourne reflected their confidence in the market and its commitment to long-term investment in the country.

“By combining Paramount’s proven local expertise with Mitsui Fudosan’s residential development experience in Japan and internationally, we look forward to delivering a distinctive, high-quality living environment that creates long-term value for residents and the surrounding community.” - FMT