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.
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.
Bust? what bust? every single year i have heard people talking about the bust…. but prices keep getting higher.. and the money you have sitting waiting to be invested in the next downturn keeps getting eaten up by inflation. that sucks!
election year coming… downturn? dont think so… maybe after election probably.. haha
Hi there,
just a quick word about the property sector in Malaysia before you participate in the socalled BOOM.
reading this and the rest of your propaganda about one of the most corrupted sectors in Malaysia is rather astonishing. quoting: “the sector is driven by emotions…” you can not be addressing the property sector as this one is driven by GREED ONLY.
starting from the planning office, the architect, the developer, the banks and the agents without an exception all greed driven!
in general the quality of the properties are at a stand still and still of a under developed country level; no isolation, mainland china hard ware quality, no double glass, second quality tiles, wrongly mixed cement,etc. are the QUALITY indicators of Malaysian construction industry.
Workmanship? What can an industry offer if the sector is solely run by foreign workers from countries where the majority of the rural population still lives in cottages together with animals?
the greed factor has nit only resulted in UNAFFORDABLE properties but in the same time OVERVALUED properties; the average house is not even worth half the asking price.
how could it grow that far? Simply, all parties involved in the game know that the customers are looking for SHORT TERM profits and are dressing up like investors. fundamental investment horizon for properties is LONG TERM in sophisticated and mature markets e.g. Europa 10 – 30 year depending on country the quality/price relation but even more the life expectation of the property is overruling the Malaysian one several times.
a special word on the professional know how of the agents: in general and of course the exception confirms the rule, it is a shame for the nation. most of them can not see the difference between a car park and the living room. selling their soul for just a ringit more commission by cheating the principal and even better the principal and the client on the same object.
who to blame for this? very simple and no questions about it: THE CUSTOMERS!
acting like a day trader( of shares) does not really contribute to solid sector and value for money concepts.
for the genuine investor: stay out of Malaysian properties as there is more quality for better prices in other countries with solid long term returns.