Property prices falling everywhere.

Property prices falling everywhere.

Advanced property market to provide a clue?

Malaysia’s property market is a small one. We are aftrer all a small country even within ASEAN. Our property market is also not so advanced. just ask Singaporeans and they will tell you that their property market is an advanced one. Here in the Klang Valley for example, people still think anywhere above 20km away from the city centre is VERY FAR. Haha.

I always encourage everyone to take a look at the suburbs in some advanced countries to understand that even 50km is not considered as ‘impossible’ and meanwhile 30km from the city centre is considered normal. I know, the next thing is that people would say Malaysia’s public transport is bad mah… Haha. Okay, let you win. You can continue to buy all those close-to-city-centre areas lah.

Now, since advanced property market are showing falling property prices, would this also affect the Malaysia property market? News here for reading and understanding.

Article in theguardian.com As per the article, here are the numbers. Houses in Stockholm has fallen 20 percent from their peak. Sydney prices are down by almost 14%. San Francisco is down by 15% and Auckland by almost 22%. Meanwhile Toronto has falled by 16%. Closer to us, Seoul has reported apartment prices which are down 24% since October 2021.

One major reason is because of the highest interest rate which has dampened buying interest. For example, the Bank of England has raised rates from 0.1% in late 2021 to 4% today. Meanwhole US average long-term mortgage rates are now above 6%. A year ago they were below 4%. Do read the full article here: Article in theguardian.com

Malaysia property market’s price movement?

When it comes to the Malaysian House Price Index, it’s an interesting trend to be honest. It looks like it’s falling but actually it’s not. yeah. All the numbers are above zero. In other words, it’s not negative. Just that the positive number is getting smaller with every quarter. Overall, the property price increase is on a downtrend yeah. From a double digit increase in 2011, 2012 and 2013, it has started to fall and fall and kept falling until it’s only super minimal at 0.6%. In other words, the property price is not falling

Waiting for property prices to fall?

Do note yeah, that property that everyone wants to buy will seldom fall in price because supply is limited while demand is huge. That property no one would like to buy, that one would continue to drop in price until someone buys and thus the transaction would show a downtrend. This is why people say it’s not possible to buy that property they want, yet. While at the same time, some owners are saying that it’s not possible to sell at the price they want. Let’s see what happens to the transactions for Q1 2023. That should give us some indicators.

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