PETALING JAYA: The real estate market in Malaysia will remain bullish this year with the general elections out of the way, according to Zerin Properties CEO Previndran Singhe.
“Since last year, everybody thought the property market will be bad. My message to the market then was not to panic, market is stable. Prices will not drop. In fact, certain locations that were feeling the pinch due to scarcity will see price increase and you can make money.” he said during his presentation at The Edge Investment Forum on Real Estate 2013 on May 11.
“For 2013, my market forecast still remains, if not more bullish, post elections. In my opinion, properties in good locations will see price increases of more than 5% this year. It will be case of too much money chasing too little properties in good locations. These locations will see upward movements,” he added.
He said the current market has been very active with strong mop up by investors, for both landed properties and condominiums, in traditional hotspots. This is reflected in the growth of residential loans.
“Being an agent, we have the pulse on the ground. We already felt the mop-up by investors in January and the problem we had was not having enough listings,” he said, adding that this is because people believe that real estate remains the best, safest and fastest way to create wealth.
His bullish outlook is due to several factors including the lack of housing supply.
Housing supply is playing catch up with demand and in the short term, will continue to push prices up, he said. He added that Malaysia’s population in 2012 stood at 29 million and it is expected to hit 39 million by 2040. “Our rate of urbanisation is the highest in the region at 2.9% - 3%. Greater Kuala Lumpur is home to 6 million people and this is 20% of our population. By the end of this decade, there will be 10 million people living in Kuala Lumpur. All these people have one need – homes,” he said.
Developers are also actively acquiring land as well as making medium-sized investments of below RM100 million. According to him, the vibrant property market is due to firm domestic demand, high liquidity in the market, vigorous private investment growth, strong infrastructure spending by the government and expansion in the oil & gas market.
With Malaysia’s economy expected to sustain at above 5% this year, inflation rate contained between 2%-3% and with Malaysia enjoying a high employment rate of 97%., Previndran says these factors make for “a solid base for real estate investment”.
The forum organised by The Edge Malaysia was sponsored by Malaysia Building Society Bhd and supported by Sunway Bhd.
For the full coverage of The Edge Investment Forum on Real Estate 2013, read the coming May 20 issue of City & Country, the property pullout of The Edge weekly.
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