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properties for sale are pervasive and offers are sweetened with rebates and
Expect a surge in housing prices when the economic growth starts to improve.
This is the time to purchase a home. incentives. It’ s a basic indication that the housing market has
In an already weak market, when positive excessive inventories. news starts to surface reporting of encouraging growth rates, business This reflects a sluggish market and that expansion, and forecast of some sellers are trying to clear existing stock. buoyant economy, employment and Recall that in the first part of this series earnings will rise. With the improvement it was reported that developers will hold in the economy and the job market, back or slow down on new projects increase in demand for housing and a when profit margins are not workable. corresponding housing price hike will In addition, constrained by rising costs, certainly follow. So, when the media there is a limit in lowering prices. reports about how rosy the economy is During an economic downturn, weak getting, it is a good time for real estate and smaller developers would likely be investment. When the economy climbs forced out of the market and thus easing back in full steam, the housing market market competition. Therefore, when the may have entered the next cycle. backlog is cleared, prices of new home supply are not expected to be cheap. Reports from sellers indicate that the Supply squeeze may cause prices to go market is now basically being supported up instead. by first-time home buyers while the government is taking an increasingly active role to help this segment of buyers with various financial plans. In addition, there is the recent report of the rising number of abandoned projects and mounting housing inventories in the country. These are signals that the local housing market has lost its vibrancy as well as any speculative fever and government incentive is needed to help maintain market resilience.
Recently there appeared some bright spots for the Malaysian economy. Firstly, oil prices have picked up, trading well above $ 50 USD per barrel. Secondly, there is the report of China’ s significant increase in investment and participation in Malaysia, specifically in the East Coast Rail Link, Melaka Gateway Project and Bandar Malaysia as well as their keen interest in the KL- Singapore High-Speed Rail.
When the effect of these development projects on the economy kicks in, excluding the changes in the local political scene, the market is expected to start improving by the first quarter of 2018. But as it stands, the current market scenario seems to suggest a‘ buy’ signal. www. PropertyHunter. com. my 39