Too many units too fast would contribute to oversupply which in turn will cause property prices to soften. Before everyone starts blaming whoever due the oversupply, just note that this happens ALL the time in ALL countries. As usual, when people are buying, the launchings automatically increase when the other developers saw the opportunity too. Very soon, number of units launched would have already exceed the usual demand but people were still buying because of the positive sentiment. What happens later when market slows and people starts to becoming sober from the earlier frenzy? Oversupply lah. Then, when would prices start dropping then? When many of buyers (especially if it’s not for own stay and many units in hand) could not hold on to their units, then the prices would suffer a sudden drop. If that should happen, sentiment turns negative and prices may just crash. For some with cash, that might be the time to wait for. Is this happening in Iskandar too? An earlier article: Is Iskandar getting better? Or worse? Media reports
Reported in theedgemarkets, there are another 9,500 ‘five-star’ development being completed by September 2017 in Iskandar. This is just 4 months away, happening on my birthday month. The units are in Country Garden Danga Bay. This will provide even more pressure to the rental market of Johor. Statistically, based on reports by the National Property Information Centre’s (Napic) Malaysian Property Market Report 2016, the Johor property market softened last year (Actually, the whole Malaysia did). Total transactions declined 16.1 percent to a total of 40,066 transactions worth RM19.45 billion. In terms of value, the drop was 10.2%. This meant that the average price is still up since total transactions dropped at a higher percentage than price. According to KGV International Property Consultants (Johor) Sdn Bhd executive director Samuel Tan in The Edge article.“Landed properties still hold up quite well. As for high-rise residential units, if they are priced rightly at RM400 to RM500 psf, there are still buyers.” (I think his statement can be considered positive because the right price would attract buyers. In other words, demand is still available)
Are we waiting for affordable units in the near future or are we waiting for ‘fire-sale’ condo units? For own stay, I think both are perfectly fine. Just choose one meeting what we need the most. Given a choice, of course I prefer larger condo units and with facilities versus a smaller one and without much facilities. Landed is not within my consideration because those that I love is quite out of the reach of most Johorean first-time home buyers. For own-stay and we need it quick, then the secondary market would provide lots of choices too. Latest results from propertyguru.commy Image attached. If the population growth in Iskandar is not as optimistic as expected, then I think the property price trend is definitely moving south, startingwith the less attractive ones in design, size, location. I personally would prefer more of those supporting news. We need more commercial activities, especially from Singaporean SMEs who want to continue to thrive and expand. We also need more schools for the children. It’s definitely value for money because international schools within Iskandar has real facilities and not be restricted by size too much. With a growing student population, the demand for properties would naturally grow too. As for now, we can wait for September to see what happens.
written on 29 May 2017
Next suggested article: Singapore will prosper when Iskandar succeeds