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Malaysia confident market will return to growth after outbreak ends
By Juwai, 30 April 2020
Juwai IQI’s “Residential Property Index – Malaysia” survey reveals how agents are reacting to the coronavirus pandemic that has slowed buyer activity in the real estate sector.
This is the second survey carried out by Juwai IQI. The “Residential Property Index – Malaysia” tracks the evolution of industry expectations for prices, rentals, and market activity trend and is based on a survey of 342 Malaysian real estate agents. While the survey was underway, between 7 February and 18 March 2020, the coronavirus outbreak went from a mild concern in Malaysia to a more serious one. These survey results reveal the changing state of mind in the market at precisely this period.
Some highlights of the survey:
- Even as they were coming to grips with the possible impacts of the coronavirus outbreak, agents forecast that nationwide prices will increase by 1.1% in 2020.
- Looking forward two years, agents demonstrated much greater confidence, forecasting nationwide prices will increase by 8.6% through the end of 2020.
- When it comes to residential rental rates, agents nationwide predict an average 1.7% increase through the end of 2020 and an increase of 7.1% by January 2022.
- The industry reports that first-time buyers made 30% of nationwide new home sales transactions in Q4 2019 — significantly more than any other buyer group.
- The subsale or secondary home market in Q4 2019 was led by first-time local buyers and local upgrade buyers. The two groups each accounted for 27% of subsale purchases in the period.
- When it comes to predictions of transaction growth during the remainder of 2020, 61% of agents expect first-time local buyers to conduct more transactions in 2020 than in 2019, and 55% of agents expect foreign buyers to conduct more transactions in 2020 than in 2019.
Note: On 18 March 2020, the Malaysian government imposed a Movement Control Order (MCO) after the country saw a spike in the increase of COVID-19 cases. Under the MCO, Malaysians will be barred from leaving the country and restrictions placed on the entry of all tourists and foreign visitors into Malaysia. The MCO which was initially to last for 14 days has now been extended until 14 April.
For more details of the survey, download it HERE.