Landscape for property sector improving

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Landscape for property sector improving

PETALING JAYA: MIDF Research has maintained a positive outlook on the property sector as it sees the landscape for the sector is improving.

In a statement, the research arm said this is underpinned by a stable House Price Index (HPI) outlook, an unchanged overnight policy rate at 3%, and a noticeable reduction in the residential overhang.

Additionally, it said the upcoming infrastructure projects such as the Johor Bahru-Singapore Rapid Transit System (RTS) Link and Penang Light Rail Transit (LRT) will further improve connectivity and support buying sentiments on property in Malaysia.

The National Property Information Centre reported that Malaysia’s HPI has been on an upward trajectory since 2022, following the reopening of the economy.

The centre said HPI has been on a growth trajectory since the fourth quarter of 2021, experiencing a robust recovery throughout 2022, driven by improvements in the Malaysian property market.

In the third quarter of 2023, the HPI stood at 219.4, marking a notable increase from 216.8 recorded in the second quarter of 2023 and 218 in the third quarter of 2022.

Meanwhile, the research firm opined that the rising construction cost and inflationary pressure may drive property prices marginally higher as developers pass on higher costs to homebuyers.

At the same time, it noted that loan applications declined on a yearly basis for the first time in eight months as demand for property took a breather.

Meanwhile, Bank Negara Malaysia said the total loan application for the purchase of property declined by 21% month-on-month in February 2024 to RM40.1 billion due to the short month.

“On a yearly basis, loan applications in February 2024 were lower by 19% year-on-year (y-o-y) after a strong growth of 46% y-o-y in January 2024.

“Nevertheless, total loan applications in the first two months of 2024 were higher by 8% y-o-y to RM91 billion, which indicates stronger demand for property,” it added.

April 24, 2024

Source: Daily Express