PROPERTY NEWS � by Free Malaysia Today
Recession in Malaysia in 2018, predicts expert At least it’ s not the end of the world. Right?
However, he said, the palm oil industry would do well due to the La Nina effect which will see more rain than expected, pushing production and prices for the edible oil upwards.
“ Malaysians will feel the pinch of recession from next year onwards due to various factors, including a decline in consumer confidence and the retrenchment of workers from such sectors as oil and gas, banking, retail, and electronics,” he told FMT.
“ Prices of medium and high-end homes will drop, with property speculators starting to tighten their belts as bank loans become harder to get.”
Hoo pointed out that Malaysians have experienced a recession in almost every decade since the 1960s.
He said in the early 60’ s the recession was caused by global rubber prices, and another recession in 1967 was due to the ringgit crash. In 1970, it was caused by global rubber prices while in the 80s, the recession was due to the outflow of funds and a property crash.
In the1990s, Malaysians experienced recession again but this time it was due to a currency crash which saw economic growth of-7 percent, he said.
“ In 2008, we experienced another recession but we managed to pull through very quickly. The 2018 recession is expected to hit almost all sectors,” he added.
Hoo also said for those looking to buy a home, the next two-and-half years might be
Professor says all sectors, except the palm oil industry, will be affected by the recession
the best time to own a medium to high-end Bank Negara finally imposed stricter property, regulations on market speculators in 2012.
However, he said the delay had caused This is because the property market had a property bubble with property prices started to show signs of slowing down six artificially increased. months ago aftermarket speculators failed to get bank loans or buyers or tenants for their Hoo said the“ fake demand” had caused properties. more houses to be built. He predicted that about 6,000 houses in the Klang Valley, 3,000 He said some of the houses were going for in Johor Bahru and 1,000 in Penang would lie almost RM100,000 cheaper. For instance, he vacant. said, a condominium unit that was going for RM500,000 in 2012 was now being sold for To overcome the“ fake demand”, he said, RM420,000.
Bank Negara should tighten bank loans for developers, forcing them to sell completed He said property prices had shot up after properties at a cheaper price.“ Most of Bank Negara’ s delay in kerbing greedy them built the properties in 2013 when the market speculators from buying and selling prices were still inflated. Even if they sell the properties under the Developer Interest remainder of their unsold units at a cheaper Bearing Scheme which exercise the“ willing price, they will still make money.” buyer willing seller” concept. www. PropertyHunter. com. my 81