6 / 7
eligibility proposed by the
government, may stimulate some
residential sales, apart fromother
plans to increase the number of
units of low andmediumcost,
the largemarket supply remains
unabated, loan growth is expected
to slow further as the weak credit
cycle continues.
Apart from the stringent loan
requirements from financial
institutions that are said to have
caused the drop in the number of
property transactions, the
increasing cost of living and
economic uncertainties have led to
an upswing inworries about job
security, resulting inmore cautious
consumer spending. These and
more will have led themarket to
H
AVING
over the past two
weeks written on the global
and regional real estate
outlook, this weekwe
feature CBRE /WTW’s overviewof
2016 andwhat can be expected in
2017.
2016 OVERVIEW
Fundamentally, you could say that
the property industry runs
alongside the economy of the
country. As reported in CBRE /
WTW’s report, domestic
consumption rose, driven by
spending in areas that include F&B,
transportation and communication.
Government consumption also
grew (according to year-on-year
basis) – with expenditure owing to
infrastructure.
Net exports sawmixed results –
slower demand fromChina and
reduced exports from the US but
the weakening ringgit enticing and
increasingMalaysian exports even
further. The weak ringgit also
opened opportunities for foreign
investment.
Other than the global rout in oil
prices that has led to a significant
number of layoffs in the oil and gas
sector, the weakening business
sentiment and slowdown in the
overall trading is also expected to be
more apparent, but in the short
term.
Looking positive was the growth
rate of retail sales which
remained buoyant despite
softer consumer spending and
the rising costs of living.
According to the report,
strong support was seen from
tourists in retail spending
from shopping. The
weakening ringgit is expected
to encourage tourists’
spending.
2017 OUTLOOK
In the Year of the Rooster, the
country’s economic growth is
expected to be slower due to
PHOTO: HTTP://WWW.PROPERTYGURU.COM.MY
Malaysia real estate
market outlook for 2017
>CBRE /WTWreport on 2016 overviewand 2017 forecasts
the challenging global economic
and financial landscape. Domestic
demand is said to be the key driver
of growth, sustained primarily by
economic activity from the private
sector. Due to the well diversified
nature of our country’s exports,
positive growth is projected into the
year. However, inflation is expected
to remain flat although pressured by
increase of several price-
administered items and the weak
ringgit exchange rate.
The impact of these cost factors
on inflation is expected to be
mitigated by continued low global
energy prices, generally subdued
global inflation andmoremoderate
domestic demand. Supportive fiscal
andmonetary policies are also
expected to help steady the ship for
economic growth. GSTwill
strengthen the government’s
revenue source to accommodate its
fiscal measures.
With the overall weakening
ringgit, low crude oil prices coupled
withworldwide geo-political issues
will continue to plague the economy
in 2017. No doubt, the year will be a
challenging one, but Malaysia’s
economy is anticipated to remain
stable with GDP growth estimated
at 4.2%.
REAL ESTATEMARKET
OUTLOOK INMALAYSIA
As uncertainties and concerns over
Transaction Volume
30000
Total Volume
25000
20000
15000
10000
5000
50,000 & Below
urce: NAPIC, CBRE WTW Research
50
,001 - 100,000 100
,001 -
150,000
2010 2011 2012 2013 2014 2015 9M2016
150,001 -
200,000
200,001 -
250,000
250,001 -
500,000
500,001 -
1,000,000
1,000,001 &
Above
0
INCREASING SHARE OF UNITS ABOVE RM500K, HOWEVER,
UNITS WITHIN RM250K-RM500K PRICE RANGE REMAIN HIGH
IN DEMAND
Landed Residential
High-Rise Residential
Purpose built Office
Retail
Hotel
Industrial
2012 2013
2014
2015
2016
Overview
UNCERTAINTIES AND CONCERNS OVER LARGE MARKET
SUPPLY REMAINS UNABATED
BOON
Property investment will remain one of the safest forms of
investment.
The demand for affordable housing is likely to become acute.
Genuine demandwill lead themarket.
Themarket is expected to cool downwith prices becomingmore
negotiable.
Areas with good transportation connectivity (nearMRT I & II,
HSR, highways) will continue to be hotspots.
Demographic forces will continue to drive underlying demand
for residential properties.
BANE
On-going concerns on the overall weak ringgit, low crude oil
prices andworldwide geo-political issues will continue to plague
the economy.
Challenging year for developers.
More savvy home buyers.
X
X
X
X
X
X
X
X
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CONTINUEDON
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consist of more genuine purchasers
with speculative sentiments not as
strong as during the boomperiod.
As such, supply has remained
resilient with greater activity in
larger cities. The proposal to boost
public servants’ housing loan
21
theSun ON FRIDAY
|
JANUARY 27, 2017