Hartanahguru.com founder Abdul Aziz Ahmad says this year will see many new houses ready for occupancy.
1. 2017 is a year for tenants
According to Hartanahguru.com founder Abdul Aziz Ahmad, this year will see many new houses ready for occupancy. However, house owners will be under pressure to compete to get good tenants. If a house is rented higher than what tenants can afford, the house owner may find it difficult to rent. They will have to compete by offering lower rental, which may end up being lower than the loan repayment to the bank.
2. Affordable houses will become a trend
When the real estate market rose in 2010 to 2014, almost every house built by developers were sold out. When the economy was more vibrant, a lot of developers built high-end houses priced above RM1 million, that they were still able to sell. Unfortunately for them, when the high-end houses were ready in 2015 and last year, fewer people were buying, as the economy slowed down. As a result, there were a lot of unsold units. Looking at this trend, developers shifted towards building more affordable houses, which still see high demand.
3. House sizes are getting smaller
As developers start to provide affordable houses, there is pressure on them to reduce the cost associated with property development. One of the actions taken by developers in reducing costs and making houses more affordable is to build smaller units. Prior to 2009, a 1,100 sq ft apartment was the usual unit offered to buyers. Between 2010 and 2015, buyers started to accept 900 sq ft units. This year onwards will see more demand for units with sizes ranging from 700 sq ft to 900 sq ft.
4. South of Greater Kuala Lumpur will be the focus
As real estate prices continue appreciating in Kuala Lumpur, buyers will continue to look for affordable houses. For buyers looking at landed houses priced affordably and with developed infrastructure, they have the choice to buy in the southern region of Greater KL, which is connected by several highways, including the SILK Highway and South Klang Valley Expressway.
The southern region of Greater KL covers areas like Kajang, Semenyih, Bangi, Cyberjaya, Salak Tinggi and Nilai.
Many projects will be ready by this year. New infrastructure facilities, some of which have been completed, and some to commence construction, are luring buyers to southern Greater KL. Among the projects that will be ready this year include the MRT Sungai Buloh-Kajang line. By 2022, the Sungai Buloh-Serdang-Putrajaya will be completed.
5. Borrowers need to be aware of the mortgage rate change.
Since 2009, interest rates have been on the rise. When new Bank Negara Malaysia governor Datuk Muhammad Ibrahim came on board, the first thing he did was cut the Overnight Policy Rate (OPR) to three per cent. This year, it is expected to be a very difficult year to predict whether the central bank will change the OPR again, due to uncertainties in the economy. Housing loan borrowers need to be aware of changes in the OPR rate to avoid loosing tens of thousands of ringgit in interest.