Property market to remain flat over next 6-9 months

Prem-Kumar-propertyKUALA LUMPUR: The Malaysian property market is expected to remain flat in the next six to nine months due to the uncertain outlook in demand and slow uptake in new launches.

Prem Kumar, who is executive director of property consultant and real estate solution provider Jones Lang Wootton (JLW), said the number of property transactions was currently on the decline.

“This is given the current overbuilding in property development, which leaves them unsellable because they do not cater to Malaysians who fall under the B40 income level category,” he said on the sidelines of PropertyGuru Asia’s Property Awards (Malaysia) 2017 here today.

He added that developers were currently focusing too much on high-end properties, leading to the neglect of the B40 segment.

“These properties will then no longer generate income and will become a liability for developers because of unsold units,” he said.

The B40 segment refers to the bottom 40% of households with monthly incomes of below RM3,900.

Prem said the government should address the matter by ensuring a pricing range that catered to more buyers, particularly those below their mid-40s. This could be done with assistance from the developers, he added.

“From the developers’ perspective, so-called affordable housing is RM400,000 to RM500,000. It is very clear that this is beyond what most people can afford.

“At the moment, Malaysia has a very loose policy. Some say RM150,000 is considered affordable, some say RM350,000 is affordable while others say RM400,000.

“So we don’t know the actual figure, and this is because the government is not acknowledging the actual situation.

“That is a major issue,” he said.

When asked on the foreign buyers market in Malaysia, Prem said it would remain intact moving forward as foreigners still considered Malaysia a stable country.

“The hiccoughs are there, but when we think about it, all countries have their own political hiccoughs. From the economic perspective, we are still very stable.

“Every country has political issues. It’s just how we manage the issues.”

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