Is the property market in a crisis? Common question from many. Besides looking at the banks’ set of results (earlier article here) we could also look at the results from listed property developers. For the developers which are not listed, it’s hard to gauge but most of the prominent developers are listed. When the market slows so much and no one buys, it’s reflected in their results. By the way, transactions did not slow starting from 2018. It has been slowing down since end 2012. 😛 Generally, the listed developers have been reporting a positive set of numbers. Not super profits but no super losses too. Here’s one latest one for IJM Corp Berhad.
Article in TheMalaysianReserve IJM Corp Bhd’s net profit for 3Q18 was RM93.42 million which was higher than the RM93.39 million posted a year ago, boosted by property and infrastructure development. For nine months, IJM’s profit was 45.8% lower from RM328.79 million over the same duration from the previous year. A decline was also seen in overall revenue by 7.6% yearly from RM4.61 billion. The group said its current financial year is expected to be taxing and because of issues such as affordability, property overhang, rising costs of living and tight financial agreements, the local property will continue to be challenging. Given the tough operation environment domestically and overseas, IJM is expecting lower performances from both its industry and plantation divisions. Article in TheMalaysianReserve for reference.
If we want to know if the property market is in a crisis, do not ask anyone. Different people will give us different answers and most of the time, biased towards what they intend to achieve. Looking at audited results meanwhile allows us to make our own conclusions. We can be biased too of course. All listed companies must release their results on a quarterly basis. For the banks, look at their earnings as well as the Non-Performing Loan (NPL). If profits are great but NPLs are on the way up, we could already see the market turning for the worse; people and businesses are defaulting on their loans for example. Another way to keep track is to keep following kopiandproperty.com too. 😛 Happy believing!
News article summarised by Dina Batrisyia. Article written and edited by Charles.
Article written on 28 Feb 2019
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