It’s Back to Basics for the
Real Estate Sector
China Developers Will Fuel Competition in Iskandar
Raising Eyebrows Among Local Developers
space,” it added.
Meanwhile, Maybank has
maintained an “underweight”
on the property sector and
expects the property market
to be hit hard by the new
property cooling measures
of Budget 2014 as well as by
some state governments.
In addition, it said stricter
mortgage lending by the
banks would also slow new
transactions.
The real estate sector
maintain neutral:
Notwithstanding the
current undemanding
valuations, the real
estate sector still lacks
positive catalysts over
the near term that could
lead to a sustainable
rerating. Most of the
regulatory measures
have taken effect from
Jan 1 and, as such, we
believe investors will
need time to monitor the
severity of the combined
measures.
Without the interest
absorption scheme,
developers will have to
go back to basics, that
is location. Properties
in good locations with
amenities and mature
areas will continue to
be in demand. Given
the affordability issue,
mid-level housing and
townships will fare better
than high-rise and luxury
products.
In 2014, we expect
property price growth to
be flattish, while overall
transaction volumes will
likely decline by 5% to
10%. Although prices
will remain resilient —
as land, construction
and compliance costs
continue to hold up —
develop