






{"id":30406,"date":"2022-09-05T13:52:28","date_gmt":"2022-09-05T06:52:28","guid":{"rendered":"https:\/\/www.asiapropertyawards.com\/?p=30406"},"modified":"2022-10-24T11:49:26","modified_gmt":"2022-10-24T04:49:26","slug":"malaysia-after-the-home-ownership-campaign-whats-next-for-aspiring-buyers","status":"publish","type":"post","link":"https:\/\/www.asiapropertyawards.com\/en\/malaysia-after-the-home-ownership-campaign-whats-next-for-aspiring-buyers\/","title":{"rendered":"Malaysia after the Home Ownership Campaign: What\u2019s next for aspiring buyers?"},"content":{"rendered":"<p>The comedown from pandemic-era stimulus measures in Malaysia weighs heavily on an electorate of property seekers ready for change<\/p>\n<figure id=\"attachment_30407\" aria-describedby=\"caption-attachment-30407\" style=\"width: 1000px\" class=\"wp-caption alignnone\"><img decoding=\"async\" class=\"wp-image-30407 size-full\" src=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1150264712.jpg\" alt=\"\" width=\"1000\" height=\"750\" srcset=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1150264712.jpg 1000w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1150264712-400x300.jpg 400w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1150264712-600x450.jpg 600w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1150264712-768x576.jpg 768w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><figcaption id=\"caption-attachment-30407\" class=\"wp-caption-text\">Semi-detached residences, multi-storey terraced homes, and superlink houses tend to perform with sales of at least 80 percent within a short period of launching. AbamjiwaAl-hadi\/Shutterstock<\/figcaption><\/figure>\n<p>The rich and rakyat alike are united by a desire to bring equilibrium to the market forces that govern the real estate sector in Malaysia.<\/p>\n<p>From the vulnerable B40 income group to the T20 earners, Malaysians have\u2014over the course of a pandemic\u2014come to understand how state intervention goes a long way toward matching property seekers with the country\u2019s surplus of homes.<\/p>\n<p>Financial easing policies fuelled a burst of exuberance in the property market in 2021. The country registered 300,947 real estate transactions worth MYR144.87 billion (USD33 billion), up 21.7 percent in value from 2020, according to the National Property Information Centre (NAPIC).<\/p>\n<p>When the policies ended, prospective buyers promptly retreated into their shells.<\/p>\n<p>GDP was up 3.1 percent in 2021 after it tumbled 5.6 percent in 2020. Unstable incomes or sources thereof deterred property purchases, according to 47 percent of property seekers surveyed for a recent consumer sentiment study by PropertyGuru Malaysia. The property marketplace\u2019s Demand Index contracted by 2.4 percent quarter-on-quarter in the first three months of 2022, following a 44.05 percent quarterly drop in Q4 2021.<\/p>\n<p>\u201cProperty seekers have taken a \u2018wait-and-see\u2019 approach since the pandemic as the nation continues its journey to recovery,\u201d says Shylendra Nathan, former. country manager for Malaysia at PropertyGuru Group. \u201cAffordability issues, inability to secure financing, job security, and overall economic stability are some of the external factors influencing homebuyers\u2019 decisions. These factors, coupled with the lack of government initiatives to spur home buying, will continue to deter property seekers from making significant purchasing decisions.\u201d<\/p>\n<p>Further dampening purchasing confidence, Bank Negara Malaysia has hiked the overnight policy rate from 1.75 percent to 2 percent in response to rising inflation and the swiftening depreciation of the ringgit.<\/p>\n<p>\u201cWith the return of demand, we expect to see a bottleneck for vital commodities such as raw materials, which may continue to push prices upwards,\u201d predicts Nathan. \u201cIn addition, with Malaysia\u2019s current large volume of unsold housing units, there may be a final opportunity to snap up properties before a possible hike in development costs.\u201d<\/p>\n<blockquote><p>Property seekers have taken a \u2018wait-and-see\u2019 approach since the pandemic as the nation continues its journey to recovery. Affordability issues, inability to secure financing, job security, and overall economic stability are some of the external factors influencing homebuyers\u2019 decisions<\/p><\/blockquote>\n<p>Yet, of the 180,702 homes left unsold in Q3 2021, around 75.4 percent of them cost above MYR300,000, the maximum price of affordable housing in the country, according to data from Bank Negara Malaysia. Completed homes that remained unsold for more than nine months after their launch, also known as the residential overhang, rose 24.7 percent year-on-year in 2021 to 37,000 units worth MYR22.79 billion, an increase of 20.5 percent in value, NAPIC reports.<\/p>\n<p>High-rise properties made up most of the overhang at 20,505 units, with Selangor holding the highest overhang volume overall at 6,095 units, followed by Johor at 6,089 units. Of the 2,936 newly launched homes in Q1 2022, landed properties made up all sales\u2014no high-rise units were sold.<\/p>\n<figure id=\"attachment_30409\" aria-describedby=\"caption-attachment-30409\" style=\"width: 1000px\" class=\"wp-caption alignnone\"><img decoding=\"async\" class=\"wp-image-30409 size-full\" src=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_318465500.jpg\" alt=\"\" width=\"1000\" height=\"667\" srcset=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_318465500.jpg 1000w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_318465500-400x267.jpg 400w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_318465500-600x400.jpg 600w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_318465500-768x512.jpg 768w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><figcaption id=\"caption-attachment-30409\" class=\"wp-caption-text\">Financial easing policies fuelled exuberance in the property market in 2021, but buyers in Malaysia have since retreated into their shells. ESBProfessional\/Shutterstock<\/figcaption><\/figure>\n<p>Semi-detached residences, multi-storey terraced homes, and superlink houses tend to perform with sales of at least 80 percent within a short period of launching, reports independent property advisor Prem Kumar, formerly the deputy managing director of the consultancy Jones Lang Wootton.<\/p>\n<p>\u201cOn paper, condos obviously indicate better financial viability, but in terms of actual sales, the landed properties are doing very well,\u201d he says. \u201cPeople are willing to pay between one to two million ringgit for good landed houses.\u201d<\/p>\n<p>Developers have proactively managed their inventory levels in response. Those that do go ahead with vertical launches have consolidated their efforts behind smaller condominium units of 800 square feet to 1,000 sq. ft. in sellable space around the pricing region of MYR500,000.<\/p>\n<p><a href=\"https:\/\/www.asiapropertyawards.com\/en\/where-gen-z-and-millennials-stand-now-on-the-property-ladder\/\" target=\"_blank\" rel=\"noopener\"><strong>More: Where Gen Z and millennials stand now on the property ladder<\/strong><\/a><\/p>\n<p>\u201cPre-pandemic, developers did not want to admit or accept the fact that we were having either an oversupply or overhang,\u201d says Kumar. \u201cThe pandemic helped the market to come to the realisation that things must be done to absorb the oversupply. Developers became more conscientious about market fundamentals&#8230;It\u2019s no longer like, \u2018I can put anything on the market, and it will sell.\u2019\u201d<\/p>\n<p>Malaysia has addressed the overhang as far back as 2011 with initiatives like the Skim Rumah Pertamaku or My First Home scheme. But nothing has riveted the public imagination like the Home Ownership Campaign.<\/p>\n<p>Originally set to end in June 2020, the initiative had since been extended several times, with pandemic-weary property seekers lapping up the hefty price reductions and stamp duty exemptions on the instruments of transfer and loan agreement. Loan applications surged in November and December 2021 as buyers maximised the final two months of the campaign, Bank Negara Malaysia noted. The campaign ultimately contributed to MYR47 billion in residential sales after discounts.<\/p>\n<p>Also well received last year was the six-month moratorium on loans, part of the MYR150-billion National People\u2019s Well-Being and Economic Recovery Package (PEMULIH).<\/p>\n<figure id=\"attachment_30411\" aria-describedby=\"caption-attachment-30411\" style=\"width: 1000px\" class=\"wp-caption alignnone\"><img decoding=\"async\" class=\"wp-image-30411 size-full\" src=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_2028097910.jpg\" alt=\"\" width=\"1000\" height=\"665\" srcset=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_2028097910.jpg 1000w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_2028097910-400x266.jpg 400w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_2028097910-600x399.jpg 600w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_2028097910-768x511.jpg 768w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><figcaption id=\"caption-attachment-30411\" class=\"wp-caption-text\">Ismail Sabri Yaakob was sworn in as Malaysia&#8217;s third prime minister in 18 months in 2021. Analysts say that investors are holding off on plays until the country achieves more political stability. zmpixes\/Shutterstock<\/figcaption><\/figure>\n<p>Sellers are now left to replace the bygone stimulus measures with their own set of incentives for homebuyers, balanced with a shrewd sense of optics. \u201cDevelopers don\u2019t want to be seen bringing down prices by themselves because they don\u2019t want to erode confidence in the market,\u201d says Kumar.<\/p>\n<p>Even though pandemic relief spending widened the government\u2019s fiscal deficit to 6.4 percent of the GDP in 2021, the government is not gunning for all-out austerity just yet. Budget 2022, in fact, surpasses its predecessor with an allocation of MYR332.1 billion, the largest in Malaysian history. The budget notably abolishes the five percent real property gains tax on properties being disposed in their sixth year.<\/p>\n<p>Next year could see the passage of the Residential Tenancy Act, offering a long-awaited legal framework protecting renters and landlords. The legislation comes at a time of marked financial insecurity for property seekers, many of whom have resorted to deferring purchases for rentals. PropertyGuru Malaysia\u2019s rental demand index rose 93.27 percent year-on-year in Q1 2022, led by a 111.23% jump in high-rise rentals.<\/p>\n<p>Yet libertarian critics found one provision in the measure, requiring deposits to be parked with a government agency, to be high-handed, if not tone-deaf. In a nation still struggling with eroding public trust due to corruption scandals of recent years, the provision came across as another way for officials to meddle with laissez faire.<\/p>\n<figure id=\"attachment_30413\" aria-describedby=\"caption-attachment-30413\" style=\"width: 1000px\" class=\"wp-caption alignnone\"><img decoding=\"async\" class=\"wp-image-30413 size-full\" src=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1373085887.jpg\" alt=\"\" width=\"1000\" height=\"667\" srcset=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1373085887.jpg 1000w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1373085887-400x267.jpg 400w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1373085887-600x400.jpg 600w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2022\/08\/shutterstock_1373085887-768x512.jpg 768w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><figcaption id=\"caption-attachment-30413\" class=\"wp-caption-text\">Chinese demand for Malaysian homes remains a shadow of itself from five years ago when mainlanders supported developments across the southern state of Johor.<\/figcaption><\/figure>\n<p>\u201cA free market is important at the end of the day,\u201d admits Kumar. \u201cBut in some instances, it could be viewed as not so good because people just start building and building. It means that we end up in situations like offices being overbuilt and so much of spaces being vacant, including condominiums and apartments.\u201d<\/p>\n<p>Many buyers are pausing their homeownership journey until the conclusion of the 15th Malaysian general election (GE15), reports PropertyGuru Malaysia. To investors, a leader with a clear mandate would be reassuring.<\/p>\n<p>\u201cThey would like to have the political legitimacy that goes along with being elected,\u201d states William Thomas, director of The Economist Corporate Network, in a recent economic update. \u201cThe business leaders we\u2019ve talked to in Malaysia have said, in some cases, \u2018I don\u2019t really care what the result is. I just need a result. I need some stability and that\u2019s going to be helpful.\u2019\u201d<\/p>\n<p><a href=\"https:\/\/www.asiapropertyawards.com\/en\/setting-the-pace-with-economist-william-thomas\/\" target=\"_blank\" rel=\"noopener\"><strong>More: Setting the pace with Economist William Thomas<\/strong><\/a><\/p>\n<p>The majority of the electorate still view real estate as a hedge against inflation. Fifty-three percent of homeowners look to buy property in addition to one they already own over the next year, according to PropertyGuru Malaysia.<\/p>\n<p>Even with movement control orders being dismantled in the endemic phase of the contagion, the residential market could take an entire year to recover from the bottom of the property cycle. Cautious optimism glints ahead, however, and a peak run is not implausible in the next three to five years.<\/p>\n<p>\u201cIt\u2019s a transition period as far as the residential market is concerned,\u201d says Kumar. \u201cIt\u2019s really a bottoming out of the market. The way I see it, most things are pointing towards gaining greater momentum moving forward.\u201d<\/p>\n<p><em>The original version of this article appeared in\u00a0<a href=\"https:\/\/issuu.com\/propertygurupropertyreport\/docs\/pr_no.173\" target=\"_blank\" rel=\"noopener\">Issue No. 173<\/a>\u00a0of\u00a0<a href=\"https:\/\/issuu.com\/propertygurupropertyreport\" target=\"_blank\" rel=\"noopener noreferrer\">PropertyGuru Property Report Magazine<\/a>. Write to our editors at\u00a0<a href=\"mailto:propertyreport@propertyguru.com\" target=\"_blank\" rel=\"nofollow noopener\">propertyreport@propertyguru.com<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The comedown from pandemic-era stimulus measures weighs heavily on an electorate of property seekers ready for change <\/p>\n","protected":false},"author":9,"featured_media":30407,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[97,92],"tags":[125],"class_list":["post-30406","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-magazine","category-news","tag-malaysia","news_country-malaysia","news_author-al-gerard-de-la-cruz"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Malaysia after the Home Ownership Campaign: What\u2019s next for aspiring buyers? 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