Virus scare makes things gloomier for property sector

The movement control order imposed earlier this week has exacerbated problems for those in the real estate sector.

GEORGE TOWN: There is a fear among people in the real estate business that the Covid-19 scourge will make bad times worse for the sector, which has in recent years already been grappling with problems associated with a soft market.

Nearly a dozen real estate agents told FMT that inquiry calls have dropped sharply since the Covid-19 outbreak hit the headlines.

They said there had lately been no requests for the viewing of properties, either for rent or purchase.

Developer Jerry Chan, a former chairman of the Penang Real Estate and Housing Developers’ Association, said he believed swift action and changes in government policies could soften the blow on the industry.

Government intervention would be especially helpful to developers who were in the midst of building their properties, he told FMT.

He said the government should take into account the disruption caused by the movement control order and allow developers to delay their completion dates.

“We also need the banks’ indulgences on repayments and loan servicing until this crisis blows over,” he added.

He said the government should push for a moratorium on loan installments for house buyers as well as those servicing loans taken to finance commercial and industrial buildings.

“Desperate times need immediate and drastic action,” he said. “We need a crisis mode reaction.”

He also proposed an extension and enhancement of the home ownership campaign that the government initiated last year, saying it did bring some improvement to the property market.

A Penang-based real estate agent who asked to be quoted only as Heng said prospective property buyers appeared to be adopting a wait-and-see attitude.

He said some were assuming prices would drop with the end of the Covid-19 threat, but he speculated that this was unlikely, noting that the Hong Kong protests kept property prices soaring.

Heng said he was meanwhile trying to make sales through videos posted on the internet so that prospective buyers would not have to be physically present at the sites of the properties to view them.

“I’m posting more 360-degree views of the properties on Facebook,” he said.

Statistics by the National Property Information Centre show that 31,092 houses were unsold as of last September.

The aggregated values of these units have dropped from RM19.54 billion in 2018 to RM18.8 billion in 2019.