Article updated at 832am. Title and HOC word.
If a property is over RM1 million per unit, it is quite tough to find that many Malaysian buyers willing to buy them. Or even to afford them. Couples who are both senior managers (both earning five figure incomes) may be able to afford it but only if they are not looking to travel or are currently driving luxury cars. If we ask around, we may find that they may be more inclined to cheaper properties so that they could continue to spend money on travelling too.
Let’s be reminded that if these senior manager couples are struggling to own such a unit, then all other couples who have a lower household income would not be able to afford them. From a typical organisation, perhaps only 5-10% of the staffs are senior managers. So, where could we find buyers for these units? Specifically for units priced from RM1 million or higher? Perhaps Hong Kong and China.
Article in malaysianreserve.com Our Housing and Local Government (KPKT) Minister Zuraida Kamaruddin says that the government has intention to bring Home Ownership Campaign (HOC) to Hong Kong and China so that the current property overhang issue could be solved. She said that the initiative is aimed at the premium properties with a price tag of RM1 million or higher.
She said, “We are only talking about houses that are in the RM1 million and above bracket. It would be very bad for the country’s image to have empty buildings everywhere. I’m sure you wouldn’t want people to see this country as a place of dilapidated and empty houses.” the premium segment she was talking about include 4,331 unsold residential units valued at RM8.74 billion based on a report by Valuation and Property Services Department first-quarter 2019 (1Q19) market report. Please refer to the full Article in malaysianreserve.com
Whether I support selling more properties to foreigners or not depends on the quantity which we are talking about. If its just a total unit of 4,331 units of overhang properties, to me its an go-ahead decision. Take a look at the number of transactions on a yearly basis to understand why I say so. Clear these couple of thousand units and start ensuring the developers do not simply build without understanding demand in the first place. I do wonder when they bring “HOC” (under MM2H) over to Hong Kong and China, would they engage any Malaysian property speakers to be an ambassador… Perhaps they can consider someone who is not directly involved with the real estate industry? Haha. Happy promoting these over there.
Next suggested article: JPPH: An update of the property market of 2018 versus 2017. Looks better. 2019?