KUALA LUMPUR: Offering a grim short-term outlook for the property market, property executives said today they don’t expect things to get better until Chinese New Year (CNY) at the earliest.
Speaking at a forum today, Sarkunan Subramaniam, managing director of real estate consultancy Knight Frank Malaysia, said he only expected to see changes in the industry “sometime around the middle of next year, when things are more certain”.
He said companies needed to be proactive in their decision making and that too many of them were signing short-term leases out of uncertainty, rather than being decisive about their future office space needs.
He said companies would start to ask: “Do I really need that much space, if this is going to be the new normal?”
Sarkunan predicted that working from home would continue even after a vaccine was found, which would change the needs of companies in terms of office space and influence where they chose to set up operations.
Previndran Singhe, Zerin Properties CEO, said the worst was not over yet but he was optimistic about the property market’s outlook post-Chinese New Year. He expects it to recover unevenly as different segments such as industrial properties, hotels and homes will improve at varying rates.
“It’s going to be very sectoral and location-based,” he said, for even if some parts of KL, Penang and the East Coast were doing well, “overall, it’s a rough ride”.
Echoing Sarkunan, he doesn’t expect to see an uptick any time soon on the use of office space. “I think it’s going to be very flat, we’re not going to see any increase in occupancy or rent for at least a year.”
Previndran urged the government to focus on empowering locals, who make up the bulk of the buying market rather than prioritising overseas investment.
“Foreign purchases amount to less than 5% of the total properties purchased. If you ask me, I’d rather focus on creating an ecosystem locally to encourage local buyers.”