22 November 2017: Datuk Hamid Abu Bakar, The Director of MyProperty Data Sdn Bhd was invited to a forum that was recently held by Property Guru Malaysia at Bangsar South. Datuk Hamid, among 3 others esteemed panelist, share his view on the current property trend and what could be the outlook of the property market in the coming year of 2018. The Forum, an annual event, was moderated by Sheldon Fernandez who is the Country Manager of Property Guru Malaysia. Below are some key highlights by Datuk Hamid Abu Bakar.
1. 2015 WAS A SLOWDOWN YEAR, 2016 WAS WHEN THE MARKET EXPERIENCED THE WORST OF ITS DOWN CYCLE AND THEN WE HAD 2017. WHAT IS 2017’S STORY IN RELATION TO PROPERTY IN MALAYSIA?
- Yes, in 2015, we have seen a spike in new property developments, particularly in the Residential segment. More than 49,280 houses have been launched in the 1H 2015 at RM73.32 billion of the value of transactions (including existing residential property).
- However, in 2016, the number of new residential property launched has dropped tremendously to only 31,257 houses due to government and BNM regulations on Debt Services Ratio (“DSR”) and Loan-To-Value (“LTV”) to control the increase of overpricing houses particularly within the RM250,000 to RM500,000 property prices.
- While in 2017, we have seen many developments in relation to property including the recent Malaysia Budget 2018 announcements. Among the developments are:
- Rising of property overhang in the residential and office space (*overhang means completed units but unsold for >9 months since launched) recently announced by BNM Governor Tan Sri Muhammad Ibrahim;
- BNM to introduce 6 key policy measures to reduce property market imbalances;
- Unaffordability to purchase residential property within the RM250,000 to RM500,000 by M-40 group segment due to stringent BNM regulations;
- New launched of affordability houses by government particularly PR1MA, SPNB, RMR1M (Rumah Mesra Rakyat 1Malaysia), PPR (Program Perumahan Rakyat), RUMAWIP (Rumah Mampu Milik Wilayah Persekutuan), etc;
- Launching of Step-Up Programme by PR1MA to ease the burden of homebuyer’s qualifications to purchase affordable house that lead to lower loan rejection rate (due to high cost of living and can’t afford to purchase 1st home);
- The government has allocated RM2.2 billion in 2017 for affordable housing measures (based on Malaysia Budget 2017);
- The reintroduction of “MyDeposit” scheme that helps young Malaysian own homes by assisting in down payments; and
- The introduction of Residential Tenancy Act and Tenancy Tribunal as an option to the potential buyer to rent before purchase can afford to purchase the 1st home.
2. GOING INTO 2018, WHAT IS YOUR TAKE FOR THE PROPERTY MARKET, GIVEN IT’S AN ELECTION YEAR?
- In 2018, I in my personal opinion and capacity will foresee a growth in the affordable housing scheme for the M-40 group.
- With the recent Malaysia Budget 2018, there is a need a focus for us in SPNB to help our rakyat and people.
- Particularly in the affordable housing industry.
- Additional to that, there will be people have a sentiment of “watch and look” for the coming General Election before they purchase any new house particularly to the 1st home buyer.
3. WHAT IS YOUR ADVICE TO WOULD BE HOME-SEEKERS AND HOME SELLERS GOING INTO 2018?
- My advice to home seekers in 2018 out there, please seek advice and assistance from SPNB for more information to purchase the affordable house for 1st home buyer. There are many affordable house choices at SPNB that the home seekers can look through.
- Please seek assistance from Bank Negara Malaysia and seek your creditworthiness standing report at BNM LINK HQ office. BNM is always there to give free advice and assistance to home buyer and home financing seeker.
- While to home sellers, 2018 will be a tough year. You will see stringent financing rules set by BNM particularly on DSR and LTV to the borrower.
- You will see very few qualified buyers on your potential home sellers as there will be more bargaining power to the potential buyer.
- To home sellers, expect there will be a “price war” due to overhang residential property market particularly new residential property with a price range above RM500,000.
The forum adjourned at around 5pm, leaving the crowd high spirited.