GEORGE TOWN, April 30 — The Malaysian property market had a good run in 2019 due to the Home Ownership Campaign (HOC), facilitating a good spillover effect at the beginning of 2020, according to the Malaysian chapter of the International Real Estate Federation (FIABCI).
Its president, Michael Geh said the property sector entered 2020 on the tail end of the HOC and was anticipating its continuation but this did not materialise due to the political crisis on Feb 21 that led to a change in government and political leadership.
He said this was followed by the COVID-19 pandemic that hit Malaysian shores, prompting the enforcement of the Movement Control Order (MCO) from March 18 to flatten the curve.
“Despite the political upheaval, the pandemic and MCO, the property sector remained active. The property sector will continue to remain resilient for the rest of the year,” he said in a statement to Bernama here today.
He said Bank Negara Malaysia’s (BNM) automatic six-month loan repayment moratorium for small and medium enterprises (SMEs) and individuals was a measure that could relieve the burden of businesses and households affected by the pandemic.
Geh said he was informed that Mah Sing Bhd reportedly receiving RM35 million worth of bookings within a week during the MCO period, while another developer also reportedly issued a statement stressing that it will not revise downwards its sales forecast for 2020.
“There were also activities of collection of earnest deposits on properties for sale on the secondary market by estate agents,” he said.
Based on these movements in the sector, he concurred with BNM’s recent statement that the property market will remain resilient in 2020 and that in line with global projections, it will rebound in 2021.
On post-MCO, Geh believed that businesses and the public will have to continue to co-exist with COVID-19 over the next 18 months.
Business practices and operations need to change to accommodate new health requirements such as the need to wear face masks and maintain social distancing, he said, adding that, “This will impact the operations of building management needs of the office and retail sector.”
Meanwhile, Geh noted that the high number of overhang residential high-rise units was mostly due to its locations and not spread widely all over the country.
“The districts with high overhang should be studied in detail and I do find the residential unsold overhang units, especially units priced RM500,000 and below, were built in unattractive locations,” he said.
Geh said government intervention and stimulus are vital to ensure the property sector will not crash in 2020 and rebound by 2021.