Are property prices surging here in Malaysia? Statistically, nope. In fact even without any official statistics, no one is going to believe you if you were to tell them that property prices in Malaysia is on a rising trend. Not even me. Anyway, statistically, there has been a price correction in H1 2020 for the Malaysian property market. Earlier article here: Price correction in the property market? Happened already in H1 2020 Briefly, we have already had a price correction in H1 2020, at a time when the transactions for residential units were down but still above 75,000 units for H1 2020.
Looking to some advanced property market
So, shall we look at some positive news about property prices surging from a neighbouring country? Specifically, the country which we always use as a comparison to all the good things and the bad things? Let’s not get into details. We can talk about these over coffee once CMCO is over. 🙂
Article in asiapropertyawards.com According to Singapore Business Review, homebuyers’ confidence improved in the third quarter of 2020 as Singapore’s economy has graduallly reopen and this pushed prices for landed and non-landed properties to rise.
Prices for landed properties surged 3.7 percent in Q3 2020 while prices for non-landed properties rose 0.1 percent in the same quarter. This information is as per a report published by the Urban Redevelopment Authority. Christine Sun, the head of research & consultancy at OrangeTee & Tie, said that the price increase indicated improved consumer confidence as economic sectors have started to reopen.
Sun said, “Investors were scouring for gems in the market whilst owner-occupiers were snapping up ‘star-buy’ units released by property developers.” Please do read the full article here: Article in asiapropertyawards.com
Note the details
It says that there are signs of property prices surging… but in percentage term it is just 3% for landed and less than 1% for non-landed. What’s important to note also is that this situation happened after the economy gradually reopens as the COVID-19 cases in Singapore abated. Cases have been in single digit level for 8th October 2020. it’s already November 2020 currently. What we need to do is to keep watching the COVID-19 numbers for Malaysia as well because there’s definitely this possibility here as well.
Property is always long term
Do not be too narrow focused on the ‘property prices surging’ part because it may change every other quarter but if we stretch this over a longer period of time, say 5 years or more, we would realise that property investment is a good investment where capital appreciation is concerned. Invest into a property with a long term view and make sure it’s not overpriced when you buy, then everything will be just fine. Buy, Keep and Sell if the capital appreciation has reached your target.
Conclusion
Malaysia is not an advanced property market. We need to have cue from many other advanced property markets. That was why for the longest of time, the property prices have not really moved that much until we realised that our property prices needed to play catch up. As at today, if we compare to some lesser developed ASEAN countries, our property prices in city centre remains on the affordable side. That’s the most important point which we need to know and be aware of even if simply buying is still going to be risky.
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Next suggested article: Buy landed or buy high-rise? Focus on price
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