I WAS at the Affin Hwang Investment Forum recently and had the honour of speaking on “Property Market Outlook 2018 & Beyond: What Now”.
Held at the new Malaysia International Trade&Exhibition Centre (MITEC), the forum attracted more than 1300 people, all eager to gain information and knowledge.
I have been in the property market for a long time and have learnt that one of the first signs of an improving market is renewed interest from investors and people eager to begin their property investment journey.
The large crowd at MITEC gave me renewed hope that the worst was behind us and that we were looking at a new tomorrow.
The 14th General Election (GE14) results have given hopes for a better tomorrow.
The property market has been on a steady downward trajectory since 2012.
The years 2016 and 2017 were easily among the worsttwo years for the industry in a very long time. Many people struggled to sell or rent their properties.
I am of the view that 2016 and 2017 were the years that the property market was at the bottom of its “U” curve. But I believe that the worst is over.
The Valuation and Property Services Department, atarecent launch of its annual Property Market Report, indicated that the first two months of 2018 saw 4.0 per cent growth compared with the first two months of 2017. The growth may be small but is nevertheless positive. If indeed we were at the bottom of the “U” curve last year, it could be indicative of the beginning ofamarket upswing.
I believe this year the market will record small growth. The GE14 results are the catalyst for better times, not only for
the property market but also for everything in general. The feel-good factor and the renewed hopes will drive the markets forward, albeitalittle hesitantly in the beginning.
But the momentum will pick up next year and, coupled with the pent-up demand of the last few years, will continue to drive the market on its upward trajectory.
The government has indicated that it will be paying a lot of attention on and putting resources into affordable housing.
Much has been said about it and despite the efforts, promises and plans made, the
net result has not been very stellar. If the current government could do what the previous government had failed to accomplish, it will be another catalyst that will help propel the market.
There isahuge demand for proper affordable
housing. No one knows quite how much the demand is for this segment, but I believe the market will be able to absorb thousands and thousands of units, provided they are in the right locations and price range.
Banks have also been encouraged to review their lending policies for first-time house buyers, especially those in the affordable segment. They needs a helping hand to purchase their first property, and any help from lending institutions will be welcome.
Once affordable housing projects get off the ground and actual sales begin on a larger scale, the activity will become a
new catalyst for the industry. It will have a “trickle-up” effect on the market and lead to growth in other segments of the market.
Withrenewed interest comes increased activity. Increased activity will translate into sales and pretty soon, the market will trudge along nicely on its merry way.
For those who have been waiting for the market to improve, this is probably the time you have been waiting for. Of course, no one can tell for sure, but all signs point
to an improved situation in the near future.
Happy hunting and may the force be with you.
Siva Shanker is a real estate practitioner who tries to manage the labyrinth of the property market honestly while consistently maintains a high standard of ethics in his practice.
He welcomes feedback via siva@miea.com.my.