Flat year and creative packages come together in 2016

It’s a fact. Property market Malaysia is slow in 2016. Both transactions value and quantity for 2015 dropped. Developers are working harder, getting more creative too. In a recent report in thesundaily, CH Williams Talhar & Wong Sdn Bhd managing director Foo Gee Jen said while some developers are delaying their launches, some are coming up with creative financing packages to move their stocks. He quoted a few, Sunway Group, IOI Properties Group Bhd, Kuala Lumpur Kepong Bhd. With tougher loan approval, developers with deeper pockets could definitely do more.

Recently, Sunway announced that it would offer up to 88% financing to home buyers under its “Sunway Property Certainty Campaign” for purchasers who book and sign the sale and purchase agreement from March 29 2016 to Sept 30 2016. This is specially targeted at buyers who were not abletoget their loans approved from banks. IOI Properties is currently offering a deferred payment scheme, targeted at those unable to come up with a lump sum down payment. Buyers may choose to pay in instalments over 18 to 24 months. As developers are not looking at losses, these measures meant that buyers were still able to buy while developers could still continue selling.

Some developers would offer direct discounts, rebates and even renovation packages. Foo said that 2016 would be a ‘flat’ year because of many uncertainties including the job market. In a recent report, JobStreet.com’s latest survey says that Malaysian employers expect improved hiring activity for Q1 2016 compared to Q4 2015. We will see if there are more job creations or layoffs as the year unfolds. He said that reputable developers with good products should do well but many developers would be missing their sales target. Actually, many of the more famous developers are still hitting their sales targets and some even projecting higher targets for 2016. 

I always believe when prices are down, values would start to emerge. I also believe that prices would not rise like the years before or else the market will crash. Malaysians need homes but only at prices which are considered affordable. Couples can increase this ‘affordability’ level when they combine their incomes but even this has its limits.

A good friend recently said that he would avoid ‘lifestyle’ products. It’s best to buy the standard products at more standard prices instead. I would think instead of looking at lifestyle versus the standard product, use price as a benchmark instead. If WE are the buyer, would we pay extra 10 percent for a better looking condo and its facilities? I think the answer may be a Yes. However, if you are asking me if I would pay 20 percent extra, then my answer is NO. Thus, do not generalise. Calculate and look one level deeper. Happy waiting for the best property. just remember to keep viewing though.

written on 13 May 2016

Next suggested article: Flat 2016? Good 2018,2019 and great 2020

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