Friday 29 Mar 2024
By
main news image

THE Malaysian property market started the year slow following a slowdown in 2014, says Zerin Properties CEO Previndran Singhe.

In 1H2014, property prices were flat due to the government’s cooling measures and Bank Negara Malaysia’s stricter lending guidelines.

However, Previndran says, activities picked up in 2H2014 but the asking prices on the secondary market dropped 15%. Overall, property transactions grew 2.3% in 1H2014 compared with the corresponding period in 2013.

“The ‘more responsible’ lending guidelines were introduced in the first half of 2013, hence the market was cautious. Then a year later, buyers knew what they needed to get a loan, which resulted in the marginal growth in 1H2014,” says Previndran.

“As predicted, the number of property transactions dropped, while prices remained flat throughout last year.”

The property market also experienced a rough start this year when crude oil prices fell, causing greater buyer uncertainty. While oil prices have stabilised in the past one month, many potential buyers are still adopting a wait-and-see attitude, thanks to the impending implementation of the Goods and Services Tax (GST).

“But I believe people will come back to the market after the implementation of  GST. For me, it all goes back to the fundamentals of real estate, demand and supply, where demand is driven by liquidity and financing,” says Previndran.

“The way we see it, there is liquidity in the market, but financing is a bit more difficult now with the tightening of bank loans. In the past six months, we saw some people withdraw their EPF (Employees Provident Fund) savings to buy properties.”

The decline in asking prices on the secondary market was due to buyers having difficulty in getting financing.

Previndran notes that property transactions were flat throughout last year. Nonetheless, there were exceptions in Bangsar, Taman Tun Dr Ismail and Damansara Heights, among others, which saw price growth.

Previndran expects the property market to remain flat but resilient this year, based on previous years’ data.

“I believe this is because there is still liquidity in the market. Genuine buyers will continue to look for homes and will buy [at the right price]. And those with extra cash will also purchase properties,” he adds.

Previndran will be speaking at The Edge Investment Forum on Real Estate 2015 at The Royale Chulan Damansara in Mutiara Damansara next month.

His presentation on Market Outlook will look at the current and future property markets, the impact of GST on homebuyers, prices on the secondary market in the past six months and what to expect this year.

Property-market_cc2_1060

This article first appeared in City & Country, The Edge Malaysia Weekly, on March 30 - April 5, 2015.

Save by subscribing to us for your print and/or digital copy.

P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

      Print
      Text Size
      Share