Downward trend in Malaysian property prices in Q1: PropertyGuru

KUALA LUMPUR: There is a downward trend in overall asking prices for properties nationwide, according to the PropertyGuru Malaysia.

In its Property Market Index (MPMI) report, PropertyGuru noted that overall asking prices had dropped by 0.84 per cent quarter-on-quarter (q-o-q) and 1.79 per cent year-on-year (y-o-y) to 87.86 points in the first quarter (Q1) of 2021.

The dip might be due to buyers’ apprehension as they take a wait-and-see approach due to the resurging Covid-19 infections and the imposition of a second Movement Control Order (MCO) 2.0 which impacted commercial activity.

In Kuala Lumpur, Johor, and Penang, the overall asking prices dropped by 0.66 per cent, 0.29 per cent and 1.36 per cent respectively q-o-q, while Selangor saw asking prices remain in the positive territory at 0.01 per cent.

“In Q1, Kuala Lumpur’s y-o-y asking price dropped by 5.00 per cent, the highest recorded dip since PropertyGuru launched its market index in 2016.

“This similar downward trend in asking prices is observed in Penang and Johor as well, both of which have witnessed a long trend of downward price movement since Q1 2019 and the fourth quarter (Q4) 2017 respectively,” it said.

PropertyGuru Malaysia country manager Sheldon Fernandez said with the backdrop of pandemic-related economic uncertainties, sentiment would remain cautious as the property market was expected to see fluctuating price trends in the coming months.

“However, the increased rate of vaccinations across Malaysian society is expected to bring more stability and improve consumer sentiment as the year progresses,” said Fernandez.

Meanwhile, he said the government’s plan to extend the Home Ownership Campaign (HOC) till the end of 2021 was a welcomed boon to the market as it would continue to play an important role in spurring buyer interest as economic conditions begin to improve across the year.

“The HOC has proven to be an effective stimulus to the economy and it has undoubtedly helped to reduce the burden of house buyers during this difficult time. If the government does decide to extend the duration of the HOC until this year ends, we encourage home seekers to take advantage of the available incentives, current low prices, and conducive interest rates,” he said.

While the overall asking prices in Malaysia had dropped, in contrast, the MPMI found that the overall supply listings tracked on PropertyGuru saw a growth of 2.71 per cent q-o-q.

It also recorded a spike of 15.85 per cent y-o-y in Q1, the highest growth since Q1 2020, indicating an upward trend.

In Penang, the state recorded the highest spike in yearly supply volume, registering a 34.17 per cent y-o-y increase and a 1.19 per cent q-o-q gain, a positive growth for the third consecutive quarter.

PropertyGuru said the robust turnaround of supply volume in key regions in Malaysia was likely due to the government’s decision to allow the construction and property development industry, along with other vital sectors, to continue operating during recent periods of heightened movement restrictions.

This indicated that developers were confident that recovery was on the horizon, it said.

“While the current environment of once-again eased restrictions offers room for improvement in Q2 2021, the property market is expected to put in a mixed performance for the duration of the year due to persistent uncertainties.

“However, we believe that consumer confidence in the property sector will regain as we progress through 2021, supported by a strong vaccination programme and favourable government incentives,” Fernandez said.

Source: NST