KUALA LUMPUR, July 19 — The residential property market in the country will continue to “self-correct” amid challenges brought on by the Covid-19 pandemic, said consultancy firm Knight Frank Malaysia.
Managing director Sarkunan Subramaniam said there were fewer completions and launches in the first half (H1) of 2021 as strict containment measures have delayed construction work, project delivery and real estate transactions.
He noted that in the secondary market, no property viewings and on-site surveys have been allowed since June.
In the first half of the year, the high-end condominium market in Kuala Lumpur continued to undergo price correction due to weaker demand and rising inventory, both existing and newly built.
Similarly, in the tenant-led market, rentals remained under pressure due to weaker leasing demand.
“Looking ahead, there is a window of opportunity as the deployment of vaccines is accelerated to allow the gradual reopening of more economic sectors under the National Recovery Plan,” he said in a statement. “The resumption and commencement of new mega developments, supported by improved infrastructure, will boost economic activities and also aid in the recovery of the property market.”
The property consultancy’s deputy managing director Keith Ooi sees pent-up demand in the housing market, evidenced by the short burst of recovery in market activity when movement restrictions were temporarily lifted.
He noted that the home ownership campaign (HOC) had been successful in reducing the property overhang with an estimated 34,354 residential units sold, worth RM25.65 billion, from June 1, 2020 to Feb 28, 2021.
“For the remaining part of 2021, we believe the overall interest in the residential sector is likely to remain subdued until the health crisis is brought fully under control,” said Ooi. “The economy is still in its recessive phase and market confidence is expected to return gradually by early 2022 as buyers and financiers are all on cautiously optimistic mode.”
“The property market is widely expected to start recovering on the back of a more positive outlook, following the recent acceleration in the vaccine drive and strong interest from domestic investors shifting from the stock market to safer and less volatile alternative investment products,” he concluded.
— Bernama
