Consumer sentiment is improving with more buyers looking to purchase properties priced below RM500,000 in the next six months.

There are a lot of concerns about Malaysia’s property market currently, such as where it is heading in the next three to five years and challenges it faces in the future.

Experts believe that the market fundamental is still resilient and people have the holding power, but if you put all that aside, market confidence seems to remain lacking, especially among first-time house buyers.

According to PropertyGuru Malaysia’s latest consumer sentiment survey, consumer sentiment is improving with more buyers looking to purchase properties priced below RM500,000 in the next six months.

It said despite the headwinds that have slowed down the property market, improved assistance from the government to increase affordable home ownership and macro-economic factors has somewhat encouraged active transactions in the market.

“While the increase in consumer satisfaction is marginal, it is likely that the improving sentiment may persist going into this year as consumers react positively to issues of oversupply in the market.

“These macro-economic factors include the strengthening of the ringgit, rising crude oil prices and better than expected GDP (gross domestic product) growth, among others,” said PropertyGuru Malaysia country manager Sheldon Fernandez.


PropertyGuru Malaysia country manager Sheldon Fernandez.

According to the property portal’s analysis, the market moderated and prices generally declined last year.

But with the better-than-expected economic performance, consumers are gaining confidence again, said Fernandez.

PRICES TO DROP THIS YEAR?

Fernandez said prices may drop further this year for certain property types due to the oversupply issues.

Consumers now are expressing improved satisfaction, he said, adding that he expects the sentiment to hold throughout 2018 barring any unforeseen circumstances.

“While some buyers may adopt a wait-and-see approach prior to the upcoming general election, it is likely that 2018 will see more transactions as buyers try to capitalise on the oversupply of certain property types, particularly high-rise strata units. This is a welcomed development, but it is really too early to say that the market has recovered,” said Fernandez.

Based on the PropertyGuru survey findings, three in four respondents, or 74 per cent, feel there is still an oversupply situation in the market — a significant jump from 64 per cent in the previous six months.

Also, their desire to purchase in the next six months has jumped five percentage points in the last six months to 57 per cent with consumers looking at both primary and secondary properties to optimise their choices.

“About one-third are looking for properties priced between RM300,000 and RM500,000. Those looking for properties priced RM300,000 and below have increased by five per cent to 31 per cent compared with the previous six-month’s 26 per cent.

“A significant number of buyers have modified their budgets and are more prepared to transact. With smaller budgets, they perhaps are better able to buy a property, which may have contributed to improving sentiment,” he added.

Very few respondents intend to look at properties priced from RM700,000 to RM1 million and beyond that, the survey showed.

Among the factors that buyers will look into when considering to buy a house are location, security and safety, and unit size.

Fernandez said while consumers are looking to capitalise on declining prices, most believe that the long-term wealth preservation capability of a real estate as an asset class is still important.

“Our data showed that a majority of Malaysians believe that prices will appreciate over a five-year period across all property types,” he added.

390 reads

Related Articles

Most Read Stories by