Revival of major infrastructure projects bode well for property sector

Several major infrastructure projects have been given the green light to resume work this year and it bode well for the property sector.

The construction of the multi-billion ringgit Mass Rapid Transit Line 3 (MRT3) project, which was suspended by the previous government, will begin in the second half of this year.

The MRT3, coupled with the revival of the East Coast Rail Line (ECRL), and the construction of the Rapid Transit System (RTS) augurs well for the property sector as it will see more jobs being created, says iProperty.com.my general manager Shylendra Nathan.

Nathan said the health of the property market largely depends on the employment level in Malaysia.

“We will perhaps witness a boon to the surrounding areas of these infrastructure projects, which can only be beneficial for the property market and homebuyers,” he said.

The RTS is a railway link between Johor Bahru and Woodlands in Singapore. When completed, the link will provide a convenient and efficient cross-border mode of transportation between Malaysia and Singapore.

The ECRL on the other hand will run from Mentakab, Pahang to Port Klang via Bentong, Gombak and Serendah.

Transport Minister Datuk Seri Dr Wee Ka Siong said recently that the construction of the ECRL can be completed by 2027, with the progress currently at 21.39 per cent.

Meanwhile, Nathan said that the rolling out of the Covid-19 vaccine is also highly crucial to see any uptick in property activity later this year.

According to National Property Information Centre (NAPIC)’s latest report on Malaysia’s 2020 property market activity, the real estate sector recorded 295,968 transactions worth RM119.08 billion in 2020, a decline of -9.9 per cent in volume and -15.8 per cent in value compared to 2019.

The housing market alone saw a -8.6 drop in value and -9.0 drop in volume.

Nathan said the decline is in line with the firm’s finding in its 2020 portal demand analytics presented in January 2021, in which the national subsale residential property demand was recorded at -1.3 per cent.

“The lower transaction trend is not surprising given that our country’s economic activities have been impacted by Covid-19 for the past year. The high unemployment rate caused by the pandemic has affected the property demand as Malaysians prioritised essential needs and services,” he said.

On the flip side, he said that these unprecedented times have encouraged Malaysians to shift their property buying journey to digital platforms.

Visitors aged 25 years old and above spend 31 per cent more time browsing for sale and for rent property listings, when compared to the nearest competitor, he said.

Nathan said this rising shift to online property searches outlines a positive property market sentiment among consumers and their desire to make more informed property decisions.

“Looking ahead, we hope there will be an improvement to the job sector in order to see a tangible recovery in the property market. At the moment, the market is being kept alive by low interest rates, cash handouts by the government through initiatives such as Prihatin Rakyat Economic Stimulus Package (PRIHATIN) and Short-term Economic Recovery Plan (PENJANA).

“Furthermore, we believe the Homeownership Campaign (HOC) continues to help aspiring homebuyers and contribute towards bringing down the overhang property stock,” he said.

Nathan said thanks to these initiatives, the current environment is more conducive for people with positive cashflow to buy a house.

Source: NST