As long as salaries are rising faster than home prices, the affordability of a property stays put or goes lower. This is the same for all countries, not just Malaysia. This is why everyone must keep transforming themselves so that they take higher responsibilities and thus higher pay. It’s very dangerous to keep repeating what we do every year and hoping next year’s increment will be better. On an average basis, property prices may rise higher than the average salary increments. However, someone who has a promotion may have a 20 percent raise in their pay and this usually meant that the person would be able to afford a more expensive property. However, the housing market is not controlled by robots but by humans. This is why there is no such thing as the most accurate prediction regardless of who that property expert is. Coming back to the property market for sellers and buyers.
Owners who could wait will usually accept only higher prices. In this case, if the transaction do happen at a higher price, it will push the average property price for that particular development up. When it happens often, then the average property price for the area goes up. Owners who could not wait would have to sell their properties at a lower price because this is the only way they could sell their units first before all the others who are waiting for higher prices. When this happens for many transactions, this would help to lower the average property prices for the said development. The valuers may look at this and value the next few similar properties lower. Banks would be much more stringent too because no bank manager would want to lend at a higher value than what the market seems to be heading towards. A good place to understand some of the happenings would iProperty.com’s brickz.my
Many people tells me that the current market is a buyers’ market. Yet, my agent friends are telling me that some owners are just ‘crazy’ because of their asking prices which just not going anywhere! Well, in some new landed property launches, the scene is a busy one. Selling all units within an hour for example. If this is the case, why did the developer not start their selling price higher? Well, the mode is to finish selling, start building and get profits. It is not to sell, then continue to sell and well, continue to sell until the cow comes home just because the price was 5 percent higher. Today, there are still many of these launches even if the right place, right type and right price usually sells pretty fast. Yes, the Malaysian economy is definitely not going to collapse anytime soon, regardless of what happens after the general election. Happy buying.
written on 3 April 2018
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