The recovery path for Malaysia’s property sector remained uneven in 2021, with some green shots towards the fourth quarter amid a marginal rebound in sales, according to the Real Estate and Housing Developers’ Association (REHDA).
Property overhang has also remained elevated and the rising cost of living has forced property buyers to defer acquisition plans, said the association.
It also noted that the property sector was significantly affected by the various movement curbs rolled out by the government to stem the spread of COVID-19.
“As the industry was about to gain momentum, the Full Movement Control Order (FMCO) that took effect on 1 June 2021, and lasted for more than three months worsened the situation,” REHDA said as quoted by Bernama.
“Many business operations including construction activities as well as sales galleries had to once again halt their operations, thus impeding growth for the sector and its players.”
The Home Ownership Campaign (HOC) and low Overnight Policy Rate (OPR) of 1.75% have pushed up residential sales, easing the overhang within the segment in the third quarter.
And while business picked up since the end of FMCO in October, overall market sentiment continued to be subdued while optimism remains on the horizon.
Data from National Property Information Centre (NAPIC) showed that there were 30,290 units of unsold completed homes with a value of RM19.75 billion in Q3 2021.
Johor registered the highest number of unsold units in Malaysia, with a share of 24%. It was followed by Kuala Lumpur (20%) and Selangor (18%).
Of the total unsold units, about 73% are high-rise properties such as condominiums, apartments and serviced apartments.
Meanwhile, the government has pledged to build 500,000 housing units for the middle and low-income group under the 12th Malaysia Plan (12MP) to cater to those in need.
The government also allocated RM1.5 billion for housing projects specifically targeted for low-income groups.
It also set aside RM500 million for the construction of up to 14,000 housing units under Program Perumahan Rakyat as well as RM315 million to construct 3,000 units of Rumah Mesra Rakyat.
Although jobs are starting to pick up, majority of Malaysians are still having a hard time, particularly those in the services and airline industry.
This comes as the opening of borders has been delayed by the emergence of new variants like Omicron.
As such, some of those working in local airlines remains under a 30% pay cut, while those in the hotel industry are yet to be fully reinstated.
“With the rise in living cost, no increment and still under a pay cut, I have cancelled my booking to buy my own home for now simply because I could not afford it,” shared Shahril Azman Razali, who works with a local airline as quoted by Bernama.
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