Although overall consumer sentiment has improved and asking prices have come down, the key issues of price unaffordability, overhang of high-rise homes, rising cost of living and tight financing will have a dampening effect, said PropertyGuru Malaysia country manager Sheldon Fernandez.
In 2018, properties are expected to remain unaffordable at 4.4 times the median income in Malaysia, with the number expected to be even higher in key urban locations like Kuala Lumpur and Penang.
“Despite higher gross domestic product (GDP) projected for 2017 and a recovery in crude oil prices, the property industry is still hampered by various factors.
“Higher GDP does not necessarily mean higher wages and disposable incomes for the B40 and M40 segments.
“Properties remain out of reach for many Malaysians due to the gap between asking prices in both the primary and secondary markets and consumer affordability,” he said.
B40 refers to the bottom 40% of households with a monthly income of below RM3,900 while the M40 group has household income ranging between RM3,900 and RM8,300.
Sheldon moderated the hour-long discussion at the PropertyGuru 2018 Property Outlook Forum today, with four other panellists – Khazanah Research Institute director of research Suraya Ismail, MyProperty Data director Abd Hamid Abu Bakar, CTOS Data Systems director Wong Pau Min, and Jones Lang Wootton executive director Prem Kumar.
Sheldon said a twin-pronged approach was required to expedite the supply of affordable homes and improve wages to ensure more Malaysians secure homes.
The event also saw the launch of PropertyGuru’s 2018 Property Outlook Report, which provides comprehensive findings of the property market performance in 2017, including price movements, supply of properties over the past 12 months, as well as emerging trends in the year ahead.
Also included are asking prices of properties and new property hotspots.
According to the report, the country’s real estate market is still correcting itself, with a steady downward trend.
It sees possible marginal drops in real estate prices in Kuala Lumpur, Selangor and Penang.
The recent bad floods in Penang are expected to have minimal effect on prices in the long term.
On improving the supply of affordable homes, one key finding was the possibility of making it compulsory for developers to build affordable homes in their projects, similar to the statutory requirement to allot Bumiputera homes.
A gradual improvement in overall consumer sentiment is expected to continue next year.
The report sees greater interest in landed, suburban properties located some distance from the city centre, particularly those on the outskirts of Selangor.
Emerging hotspots, such as Rawang, Shah Alam North, Setia Alam, Ijok, Semenyih and Kota Kemuning, are expected to continue gaining momentum.
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