This article first appeared in City & Country, The Edge Malaysia Weekly on November 4, 2019 - November 10, 2019
While the property market has regained some strength this year, overhang and unaffordability issues remain in the residential sector. At The Edge Investment Forum on Real Estate 2019 to be held on Nov 16, CBRE|WTW managing director Foo Gee Jen will discuss the property market in his talk entitled “Market Outlook for 2020 & How Has 2019 Performed So Far?”.
The optimism this year is attributable to continued market resilience and market players who have remained calm despite the economic turbulence, he tells City & Country ahead of the event. The Home Ownership Campaign (HOC) was successful in boosting house purchases but developers need to continue to proactively comprehend market demand, he adds.
“Overhang and unaffordability issues continue to cast a cloud over the residential sector. The question is, is there enough demand to support the residential market at historic price levels?” asks Foo.
“When all is said and done, uncertainties abound and 2020 may see further marginal recovery, with pockets of opportunities still to be found.”
To be held at MITEC Kuala Lumpur, the forum’s theme is “To buy or to rent: What and where?”. There will be five speakers.
The second speaker, Siva Shanker — CEO of real estate agency for Rahim & Co International Sdn Bhd — will speak on the topic, “Buy, Rent or Buy-to-Rent?”.
He says as the market becomes more complex and property prices continue to rise, it will be more difficult to purchase a house and many may have to resort to renting until they can afford to buy.
“There are also rent-to-own schemes. I will attempt [at the forum] to shed light on them, bring easy-to-understand data to explain the current market situation and touch on strategies the average person can use to navigate the Malaysian property market and be equipped to identify and secure the assistance of reliable experts to help them in their property search,” says Siva.
Apart from renting, there is also the option of buying auction properties. Property Auction House executive director Danny Loh, in his talk entitled “Auction 101”, will give participants an introduction to property auctions in the country. He will then give advice to bidders on how to prepare prior to going for an auction and what needs to be done after an auction.
He will also be highlighting some of the things bidders will need to look out for when buying an auction property and how to go about it. “For example, when bidders are unaware of the 90 to 120-day time limit for settling the balance of the bidding price, they may lose their deposit.”
Other points of discussion will include the types of research that can be done by bidders before an auction, so as not to end up with an unfavourable investment choice. “There are also the issues of vacant possession, outstanding bills and property limitations, as well as costly repair works since a bidder cannot inspect the interior of the property,” explains Loh.
Zerin Properties real estate negotiator Natasha Gideon will focus on millennials in her talk “Millennials and Home Ownership”. She says the agency usually receives enquiries on newer properties and 3-bedroom condominiums with a price range of RM250,000 to RM600,000, that are close to light rail transit or mass rapid transit stations.
“Most of them end up buying new developments due to the many government schemes such as HOC, which allows for lower entry cost. If we are talking about wishes versus reality, we want landed properties in not-too rural areas priced below RM500,000, but sadly, properties with those price tags are quite far away from public transport and access to more than one major highway,” she says.
“The reality is that even 3-bedroom condominiums that are close to public transport are becoming expensive but if you do your research and pace yourself, good deals are there for the taking, especially in this current buyers’ market.”
The final speaker is Chur Associates founder and managing partner Chris Tan, who will speak on “The Evolution and Legal Aspects of Home Ownership”. He will talk about the legal aspects of owning a home, which have changed over the years, thanks to factors such as globalisation, mobility and connectivity.
“Renting has practical appeal while absolute ownership is now a luxury that is also a burden to most of us,” he says. “Today, there are better defined lines in terms of owning, using and managing a home. Ownership can now be absolute or partially shared. Financing and management are increasingly sophisticated to give us more options and flexibility.”
According to Tan, it is important for homeowners to understand their requirements and financial ability before making any decisions. New, upcoming drivers include property crowdfunding, rent-to-own (under Budget 2020 and those offered by private developers), transit housing offered by Kuala Lumpur City Hall, new public housing solutions as well as the co-living concept.
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