Despite the economic headwinds brought about by the Covid-19 pandemic, the Valuation and Property Services Department (JPPH) expects Malaysia’s property market to remain resilient.
This comes as the government continues its focus on affordable housing and in finding solutions to the country’s property overhang situation.
JPPH released nine reports on Wednesday (29 April), including the Property Market Report, which revealed that the property market is forecasted to rebound along with the Malaysian economy, reported The Sun Daily.
“The close monitoring on the implementation of programmes under the National Housing Policy 2.0 (2018–2025) and various incentives introduced to promote home ownership among Malaysians, are expected to contain the overhang situation in the coming year,” said JPPH.
It noted that the government has provided various incentives to cushion the impact of Covid-19 on the property market.
“However, given the challenging market coupled with the downside in consumers and business community confidence, market activity and market absorption are likely to be slow,” it said.
Last year, the property market registered a marginal improvement, with transaction volume and value increasing 4.8% and 0.8%, respectively.
The overall property market was led by the residential sub-sector, which contributed 63.7%.
Malaysia posted 209,295 residential transactions worth RM72.42 billion in 2019, a 6% and 5.3% improvement in volume and value, respectively from the previous year.
Residential properties priced at RM300,000 and below accounted for 61.7% of all residential transactions.
Meanwhile, the overhang and unsold situation improved last year as the number of overhang units dropped 5.1% to 30,664, while values fell 5.2% to RM18.82 billion.
The number of unsold under construction and not constructed also declined 10.2% and 15.6% to 72,692 units and 16,774 units, respectively.
Johor recorded the highest number and value of overhang units at 5,627 units worth RM4.7 billion or making up 18.4% and 25% of the national total.
The overhang of serviced apartment, on the other hand, continued to grow, with 17,142 units worth RM15.04 billion in 2019, or up 51% in volume and 65% in value from 2018.
Johor once again recorded the highest overhang of serviced apartment at 12,207 units worth RM11.56 billion. The figures accounted for 71.2% of total volume and 76.9% of total value.
Office sub-sector had a less promising performance in 2019, with overall occupancy down to 80.6% from 82.4% in the previous year.
The retail sub-sector registered a stable performance, with overall occupancy rate at 79.2%, a slight decline from 2018’s 79.3%.