Everytime someone prominent say anything about the property market of Malaysia, we should note it down. Slowdown is slowing down means the downtrend in the property market where transactions are concerned is really slowing down. In brief, still dropping but not that sharp a drop anymore, for 2018. This is the comment from property consultant Rahim & Co International Sdn Bhd.’s executive chairman, Tan Sri Abdul Rahim Abdul Rahman. It (property market) may even start expanding by 2020. He said, “We do not expect the property market this year to be much worse off than in 2017. Expect it to be stable this year, and given another two years, it could pick up more.” He added, “Our economic fundamentals are good, oil prices have stabilised, our GDP has grown, investment from overseas are coming ….and we are politically stable, comparatively.” This is the full article in iproperty.com.my
Tan Sri Abdul Rahim was launching Rahim &Co International’s annual publication, ‘Rahim & Co Research: Property Market Review 2017/2018 on 12th February 2018. The report says that the industrial sector is expected to see a rise in demand because of the demand from e-commerce segment meant it needed support from the many logistics and warehousing players. Developers are also shifting their focus to the affordable residential property category. These are properties within the price bracket of RM250,000 to RM500,000. These properties target the middle-income earners. Abdul Rahim gave an assessment and a suggestion. “The trouble with housing is, land is a state matter. It must be the state that has to initiate the affordable housing effort in certain states like Selangor and Penang.” He added, “Maybe the government should impose a land acquisition act, even on private land, in order to help build affordable homes at certain locations.” The report also commended the government’s cooling measures and responsible financing guidelines which have helped moderate the spiralling price growth in recent years to a more sustainable five per cent to 7.5 per cent. It may have also mitigated unwanted risks towards any non-performing loan issues. Full article in iproperty.com.my here.
I am very supportive of ‘responsible lending’ policies. If one could qualify / afford to buy a higher priced property, I think he will get his loan application approved. If one could not yet qualify, then there is nothing wrong to look at cheaper units. One can also look a little further. Last but not least, it is always possible to buy smaller and upgrade to bigger later on. Search all the property sites to know that there are still choices even for affordable ones below RM400,000. Buying a smaller unit and upgrading later is still a better mode of getting a home versus trying to apply for a loan which is beyond the person’s current pay (Debt service ratio) and thus could not be approved and kept complaining that banks are being unfair to them. I prefer banks to be able to continue lending and not start racking up non performing loans from those who are really stretching themselves to the very end. What if the person lost his job and found a job only 3 months later? Who will help him pay the mortgages in the meantime? Yes, slowdown slowing down means the opportunity to buy at a lower point is getting shorter. Not immediate though since Tan Sri Abdul Rahim is anticipating the market to expand again only in 2020. Happy believing.
written on 14 February 2018
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