There’s one question that I would always pose to any analyst. Can GST beat the demand vs supply equation for the property market. To those who answer, maybe not in total but it can distort the market, my next question would be for how long. If the answer is 6 months, then I think the answer is clear, it may be best to buy now instead of waiting for that 6 months to come because by then, you may have lost that few percentage point of potential profits. If the answer is one year, that’s even better, you have time to accumulate a little bit more before buying. Note though that whatever answers that are given, it does not change the demand vs supply equation. Those who need a home would still need to buy a home. They just need that right one to come along. Perhaps price is that final frontier.
Can supply increase? Well, of course it can increase but the question would how fast can it increase? Does everyone understand that if the total number of projects starting in 2015 is reduced by 50%, it would meant that property prices would most probably go up by 2018 when the market realised far too few properties were being completed by then? Thus, slowdown may be a better time to buy than a ‘HOT’ time. Reason is because many of the usually rational thoughts are out of the window when everyone you know is buying. If everyone is buying, surely they are right? For a democracy, perhaps. For property buying, please go back to why are you buying in the first place. The rest of reasons just do not count.
Are demand reducing? Well, look at the numbers who are getting married. Read here: Why Malaysia need 8 Million homes based on current population? Demand is definitely not reducing when you look at the baby product departments in all departmental stores. Look at the new baby rooms being built for mothers to change diapers or breastfeed their babies. They are not just new, they are well equipped. Kids eats free. Buy property. Seriously, stop talking as if GST will bring down the whole property ‘industry’. GST is in fact no match for demand and supply. The only thing that will affect demand and supply tremendously remain the same. Only if another financial crisis happens. I am not sure if anyone wants that though. Cheers!
written on 6 Mar 2015
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