The slowing economic growth in Malaysia is expected to affect the property market in a negative manner. Even with the handful of measures introduced in the last Budget 2020 to address the issues, the property outlook for 2020 is still expected to go slow for some time. With the steadily growing prices, the surplus of supply and demand that is stabilizing, it is expected that it would take several more years for the property market to get back on track. Let us look at the ways the property market could regain its momentum.
Absorbing unsold properties
As it stands, more properties are being built than the demand, especially when it comes to high-end properties. Consequently, the balance will collapse as the newly built properties will lack willing buyers to purchase or invest in them due to the high property price. This is made even worse with the introduction of higher stamp duties for high-end properties that got introduced recently. It is expected that with the current supply outpacing demand, it will take about three years for all these unsold properties to get absorbed by buyers.
Increased market competition between developers
Moving on, with the supply on the increase, the competition will be inevitable between developers as they struggle to attract buyers to their property. As a result, many developers are expected to reduce their pricing and profit margin to simply sell off the property. This may seem like a win for late buyers, but for the ones who brought the property earlier at the initial price tag, they may experience financial and trust losses. On the other side, this may discourage investors from entering the market due to the loss of profit, hence reducing the image of the market that is already fragile.
Focus on sustainability
To counter that, developers and players should then focus on more sustainable development, in which new projects shouldn’t be simply done just because there is land available. Instead, the focus on developing townships with inclusive communities would be a long shot that will enable a win-win situation for everyone – buyers will get not just a house, but a home, while developers will be able to plan their supply accordingly.
Well, the Malaysian property price index might be daunting for the time being and as for individuals lie you and me long term renting is still a viable safe option.
At times of uncertainty like this, it’s best to make sure you are sustainable at any given time. Save the deposit, use SPEEDHOME instead. This Zero Deposit platform will save you thousands of your savings!