SURVEY | Major infrastructure projects like the KL-Singapore High Speed Rail (HSR) and the Mass Rail Transit (MRT) are set to return investor confidence to the challenging domestic property market, according to a survey conducted by the Malaysian Institute of Estate Agents (MIEA).
Of the 370 MIEA members and estate agents surveyed, 91.5 percent expressed confidence that the HSR will have a “medium to high impact” - improving prices and demand between 10 to 30 percent - on the local property market this year.
Slated for completion in 2026, the HSR is set to take passengers from KL tp Singapore through Selangor, Negeri Sembilan, Melaka and Johor in 90 minutes.
Meanwhile, 85.2 percent of the survey's respondents think that the MRT 2 (Sungai Buloh - Putrajaya) and the MRT 3 Circle lines will help bring growth to the property market.
Other infrastructure projects which are expected to significantly improve the market are the expansion of the Light Rail Transit (LRT), the upgrade of the Penang International Airport, the push to make Cyberjaya a one-stop centre product prototype development, the Digital Free Trade Zone (DTFZ) and the Pan-Borneo Highway.
However, property sector growth is set to be limited to urban areas and locations surrounding these projects, said MIEA president Eric Lim (below) commenting on the survey results.
“Many feel the infrastructure projects initiated by the government will mainly benefit properties located within close proximity to them and not the entire neighbourhood or township,” he said.
The survey also saw 78 percent of respondents expecting the domestic property market to pickup after the 14th general election (GE14).
“Most respondents feel that political stability is important to ensure improvements in the economy and they expect the property market to improve after GE14,” Lim said.
He was speaking after launching the survey results as part of the institute’s Market Sentiment Report 2017/18 at the MIEA office in Petaling Jaya today.
The survey was conducted in light of investor uncertainty after the government decided to freeze approvals for all high-end (above RM1 million per unit) residential and commercial developments from Nov 1 last year.
This was after Bank Negara Malaysia expressed concern the high volume of unsold high-end properties in the Klang Valley and Johor.
However, it was later announced that the freeze would be implemented on a case-by-case basis.
'Developers adapting'
MIEA also provided its market outlook for 2018 and forecasts that affordable housing will be the most in demand.
A total of 53.2 percent of respondents projected a “good outlook” for residential properties priced at RM350,000 and below while only 20.8 percent projected the same for mid-range apartments and condominiums.
On the contrary, high-end serviced apartments, “small office home offices” (SOHOs) and retail complexes were given a “poor outlook” by more than half of the respondents.
Elaborating further on the survey's results, MIEA’s Kelvin Yip (below) said developers were beginning to adapt to demand.
“Developers have been holding back and delaying launches while re-planning their products to cater to a changing market. More developers have switched their focus to affordable housing.
“More developers are expected to shift their focus to established fringe locations and upcoming hotspots along rail transportation routes […] with niche and affordable housing projects,” he said.
This was true not only of the Klang Valley property market but also included the Perak and Johor markets as well, he said.- Mkini
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