There is no doubt that the COVID-19 outbreak has an impact on the local property market.
What are the effects?
Property developers and home buyers, including investors, breathed a sigh of relief in January after Bank Negara Malaysia (BNM) decided to reduce the Overnight Policy Rate (OPR) to 2.75% – the lowest since 2011. It is a rate a borrower bank has to pay to a leading bank for the funds borrowed. The OPR has an effect on employment, economic growth and inflation.
Ohmyhome’s Property Agent, Vince Lai added: With the OPR at its lowest percentage, I believe the government is trying to encourage consumption/spending so that the economy can remain healthy. This is also a good opportunity to get a mortgage, for those who have been wanting to buy a house.
Real estate experts and analysts foresee “rough times” ahead for developers. With Bursa Malaysia’s filings where many developers have posted lower earnings – launches are not as aggressive as before, numbers and values of properties launched have reduced year-on-year since 2017 – it’s most likely many developers will not meet their sales targets this year.
What are developers positive about?
Developers are putting their bet on another round of Home Ownership Campaign (HOC) in 2020. HOC 2019 cleared 31,415 residential units developed by federal and state governments, and private builders, valued at a total of RM23.2 billion as at November 2019, surpassing the initial target of RM17 billion. With sales achieved in December, final sales could reach RM30 billion.
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Source: New Straits Times