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OSK Research predicted that, Malaysia’s property sector is set to see its biggest residential boom in a decade, led mainly by medium- to high-end landed properties.
The sector may peak sometime in 2012 to 2013 before going into a potential slump.
OSK Research said a major mass housing boom will likely occur in the first half of this decade. It added that the sector was already entering the early stage of a property “super cycle”.
Although the expected peak in 2012 – 2013 may have dire consequences, the phenomenal boom that immediately precedes it gives investors an excellent opportunity to profit from the trend for at least the next 12 months.
Location is a key to identifying real estate opportunities, but timing is equally important but often overlooked.
The current 20-year boom in the medium- to high-end residential properties since the early 1990s might peak in 2012 – 2013, after which mass affordable housing could dominate the real estate industry around 2015 to 2016.
Country’s current boom in higher-end residential properties is probably in its longest “bull run” ever, spanning almost two decades since the early 1990s.
This, unfortunately, has also given rise to the illusion of the infallibility of properties. We are now entering the final phase of this secular boom, which will be characterised by a period of fast-rising property prices in the medium- to high-end residential segment, particularly landed ones.
OSK Research also observed that those born in the 1950s had become more risk-averse in their investments since 2003/04.
As they approach retirement, they will divert a significant portion of their wealth into savings and traditionally perceived defensive asset classes such as real estate. However, their eventual absence may bring an end to the boom if there is no credible demand force to fill the void.
Mercury Securities head of research said the boom will only benefit certain areas and selected developers. There is a property overhang project in Mont’Kiara and some buyers are facing financing problems.
Independent property valuation surveyor see that the trend right now is to go for boutique projects complete with gated communities and modern facilities and townships, such as UEM Land’s Symphony Hill which saw units snapped up within days of its launch.
The boom, however, only benefits the rich and does not benefit the general public.
Related posts:
- Stock Picks – Property Sector – September 2010
- OSK Property Sector Stock Picks, June 2011
- Stock Picks – Property Sector – November 2010
- 2010 Price & Capital Appreciation of Malaysian Property
- Property Auction, Guidelines and Tips for Buyer
- Beware of Traps When Buying Auctioned Property
- NEM, Is it a Good Opportunity to Invest in Property at Sg Buloh?
- The Edge Top Property Developers Awards 2010
- Real Property Gains Tax for Year 2010
- Banks Going on Price War by Offering Low Mortgage Rate
{ 8 comments… read them below or add one }
That will be so cool if what have mentioned on above is happening! Then i might able to make my big money from property investment in Malaysia!
I hope it happen too. Good luck!
yeah…i hoping for the bust. can get cheaper rental property in KL,PJ,Bangsar..on a 30%discount…:)(buy 20unit one go). ITs not about how much you can save…it about how fast you can make the money and multiply it…
I hope it happen too. Good luck!
Ya, it will be good news for buyer. Create more wealth via property investment.
Ben
Seems like everyone is waiting for prices to drop. I feel its hard for prices to drop dramatically unless there is a significant negative impact on the economy (like 1997 financial crisis).
With the drop in the stock market, that may be the case but we’ll probably have to see how drastic a drop may come.
Already property prices have hit it’s peak. The buying has slowed, people are looking at the figures and realising it is not worth the current money. When it busts it will be a bad one, and I think it is sooner than expected. Companies like OSK always like to put out the good news to get people to continue to buy to profit theirs and their clients’ interest. This fallacy that housing prices will go up forever has been proven false in the US and Europe. Soon to hit Asia.
Malaysian properties, especially houses of medium range from 100k to 1000k will not go down like US. Reasons being:-
(1) BNM’s stringent policy (bravo to BNM)
(2) the demography of the rakyat – mostly in the twenties (25 to 40??). Will be looking for properties to set up new families.