Secondary residential property market recovering in H1 2021
A close friend just asked me an hour ago about her current tenant (a friendly couple) offering to buy her condominium unit in Penang. The tenant told my close friend that they loved her unit and asked her for the best price she could offer. At the same time, they found a unit at the same development for RM750k.
I told my friend, “If you need the money to invest into something else and it’s a profit, then can sell. Else, ask them to go buy the other unit.” The reason I say so is because this is indeed a great time to sell IF we have another investment we are eyeing. Else, if we sell and then leave the money in the Fixed Deposit, chances are the returns are likely to be lower versus waiting for better times.
My friend’s final decision? She will tell the tenant to go for that RM750k. She was not ready to offer the same price to the tenant. By the way, this is indeed what’s happening in the secondary market yeah. We have buyers who are still keeping their job and they are thinking of buying. We also have owners who could sell or could hold and that’s a choice. This is why the secondary market is so vibrant. This is also confirmed by iProperty.com.my too.
Their latest press release as below: (Full article here) iProperty.com.my today revealed that Malaysia’s subsale residential property demand experienced positive growth in H1 2021, rising to +19.2% from -2.5% in H1 2020.
Premendran Pathmanathan, General Manager for Customer Data Solutions & Quality, iProperty.com.my said, “It is encouraging to see recovery for the subsale residential market in H1 2021. The COVID-19 pandemic did not adversely affect this segment as it did in the first half of last year where the H1 2020 demand figure dropped into the negative region.”
Increase in home loan applications and positive demand for all property types
The double-digit demand growth does not only represent an increase in property interest. Homebuyers also took follow-through actions as many applied for home loans in H1 2021, expressing genuine purchasing interest.
Premendran continues, “The upward trend of approved home loan applications is promising. It shows that financially abled Malaysians are still interested in purchasing homes either for their own stay or for investment purposes.
Kuala Lumpur’s affluent areas holds steady
Kuala Lumpur posted an +8.1% growth in subsale residential demand, compared to +0.3% in H1 2020. The asking prices in affluent areas such as Damansara Heights, Sri Hartamas, Mont Kiara and Desa Parkcity are more likely to be higher as these are prime areas for wealthy property seekers.
Demand remains high for suburban areas in Selangor
Selangor’s subsale residential property demand grew by +17.6% in H1 2021, mainly driven by the +20.7% YoY demand increase for terrace houses (+3.5% for asking prices). The state’s suburban areas remain the top choice seeing that the working from home trend is here to stay and consumers are interested in affordable, spacious properties. Their latest press release as below: (Full article here)
Property market will always be supported because demand for home will be robust
There is really no need to wait for any surveys. Just ask 10 friends if they have a home, yet? Ask the ones with a home, will they upgrade if they found a better property at an attractive price. For the ones who are older or have university going children, ask them if they will help their children buy a property. These are just the demand for properties among our friends yeah.
We have yet to include the fact that every year, we have 250,000 fresh tertiary education graduates too. The only reason they are a little delayed this time in moving to all the major cities is because of Covid-19 lockdowns. Imagine, if it’s back to normal and they move to the bigger cities. Then, demand will be back to normal yeah.
This is why demand for residential property will be robust. Well, at least until the time when our population of over 60 year olds are over 25% of the population. Then, the demand does NOT drop yeah. The demand changes…
Happy understanding and nope, there are NO LINKS below for you to buy any property. Cheers.
Next suggested article: When demand increases, rental increases too