Property market uncertain ahead of polls
UPDATED @ 07:30:30 PM 18-02-2013
PETALING JAYA, Feb 18 – The optimism level of Malaysian property market in 2013 is expected to stay low due to general election uncertainty, a property industry survey revealed today.
According to the Real Estate and Housing Developers Association (REHDA) Institute, the optimism level is expected to increase to 32 per cent in the first half of this year, from 28 per cent in the second half of 2012.
However, the trend continues a drop from 48 per cent in the second half of 2011 to 29 per cent in the first half of 2012.
“There is some election overhang ... This is probably for industrial and commercial (properties),” REHDA president Datuk Seri Michael K.C. Yam said here.
Malaysian Institute of Estate Agents (MIEA) president Nixon Paul agreed with him, saying that people are more cautious and are adopting a wait-and-see approach.
This comes as MIEA announced here that in 2012, buyers viewed property prices as being too high.
“As far as we’re concerned, the prices are not going to come down,” Paul said.
On average, most of the property planned to be launched this year will be around the RM250,000 to RM350,000 price range, a marked difference from most of the property launched in the second half of 2012, which were in the RM500,000 to RM1 million range.
A major hurdle faced by developers and real estate agents last year was the responsible lending guidelines introduced by Bank Negara Malaysia in early 2012, which caused a lot of loan applications by prospective buyers to be rejected by banks.
The new guidelines include calculating loans eligibility based on net rather than gross income and aimed to increase prudent lending and avert the risk of property asset bubbles.
Fifty-four per cent of developers surveyed reported problems stemming from tighter loan requirements and eligibility, while 46 per cent had issues after their buyers were granted loans, but with lower margin than expected.