What phase is the property market in now?

Purchasing property can be a mischievous, but definitely rewarding, investment. The property market is influenced by supply and demand, approval rate of loan , and the health of the Malaysia economy, all of which are constantly fluctuating. Investor or home buyers, paying for a property , regardless of size or location, is a substantial investment, therefore it is important to understand the current trends affecting the market.

According from TheStar news, "The excess in supply of residential properties is expected to clear in three to four years, paving the way for a recovery in the property market, says housing industry experts.

The new National Information Property Centre (Napic) 2016 report shows that the incoming supply of residential properties has inflated to 94,124 units, compared to 82,837 units in 2015. 

Incoming supply refers to those properties undergoing construction work to be completed in three to four years. The incoming supply figure looks alarming at first glance. In actual fact, however, about half of the amount has been sold."

Read more at [Residential supply expected to recover in 3years.]

In the news, it is also mentioned that the number of unsold completed projects in Penang has doubled over the years adding on with the pressure of more new launched projects.
The residential supply has been overflowing and the demands are not that high due to the financial pressure for this few years ( especially the drop of Ringgit ). To the good news, the analysts did mention that if foreign funds does not move into the market, the pricing of the unsold houses will probably go into a correction in the next few years.

What would this mean?  

The supply of houses is too much compared to local demands, and the prices will reduce to ensure all the completed project units are being sold before launching more new projects. Definitely a good news for all of us, investors or not. The houses will become slightly more affordable and a good chance for you to step into the boat before it launches into the sky again.  

And what comes next after the price reduction? Appreciation! It is always a cycle, wait for the timing and invest with a good strategy!

The property market is now undeniably in a consolidation state where there are good opportunities there for people to invest. New projects with an advantageous location or connectivity and those delivered by reliable developers will continue to attract buyers as they tend to appreciate much in the long run.  

W.

An imminent uptrend?

Which cycle are the property market of Malaysia in right now? Peak high? or deep mud?


The property market will only start its upward trend again in 2018/2019 before peaking again in 2020/2021 , by The Sun. It is also mentioned that although the market are looking real bad right now, but things will soon come to a turn as everything is a cycle. Few years round and the market will be emerging again from its damaged form since few years back.


In 2017, the housing market is expected to continue slow growth, due to concerns about the slowing economy and the ringgit's weak performance, among others. Not to mention the high-rising debt ratio of Malaysians and more scandals from GLCs ( Government-Linked Corporations) which definitely affect much of our currency and stocks market.

According to New Straits Time, house prices in Kuala Lumpur continue on an uptrend, posting a modest 5.1 per cent year-on-year increase, despite the weaker property market condition. 

Why? Because properties are your assets. Your net worth. It doesn't run and it doesn't leave you in one night. 

Even when the market sentiment is not optimistic, house prices continue to rise. Despite the fact that the salary is not increasing linearly along in a reasonable way, which has been mentioned for years now, the price is still increasing. 

Don't try to time the market for property bubble popping and price dropping significantly. The price will always continue to rise. Our Malaysia currency was the worst performing currency in whole Asia for the year, clipped together with the scandals of 2.6bil donations and 1MDB debts and more. You know what? Our economic growth continue to grew by 4.3% y-o-y (year on year basis) and housing price continue to rise as well.

Can you imagine when your next of kin grow up and start to buy their own properties, what price will be given at that time? Will their salary level increase much better compare to now? Did your salary differ much compare to your father and mother generation? As much as the property price difference?

Stay tune to this blog for more info on Penang property market news!
New project from May2017 :
- Urban Suites
- Golden Triangle 2

You can just leave a message or pm me if you wish to know more about available housing projects in Penang! 

W.

Penang Property Bubble?

Are the property markets in Penang heating up for an imminent bubble pop? I don't think so.

A property bubble is when the housing prices irrationally surge up in a short period of time and reaches a peak price record with some unforeseen reasons. As the bubbles pop, the prices will undergo a deep consolidation plunge, which could be the cause for the next economic crash.

If we look at Penang nowadays new condo projects which cost around RM 500K in average for 1000 sqft area, it would cost about RM  per sqft

Comparing to Hong Kong, a case in point – a 26-year-old government-built apartment of 420 sq ft in the Sham Shui Po area of Kowloon district was transacted at HK$1.98mil, or HK$4,714 per sq ft. which is around RM2600 per sqft !

Does Hong Kong pops its bubble yet?  It has been surging up for years due to their unbalanced population and land area.

In fact we are very similar to Hong Kong in terms of geographical landscape , we all have the same problem of land scarcity. I believe that sooner or later Penang will have its housing price continue to rise in a healthy pace. Which means, more expensive houses are waiting for the next generation.

However, we should not be reckless to invest by merely taking Hong Kong as a guide since Malaysia has a different economic structure and stability with HK. Property price will be higher in Penang in the future for sure and we as investors could earn from it significantly, just make sure that we do not buy overvalued properties as it would drag down our profit margin of safety and expose us to further risk of property bubbles.

Investing in property will hardly go wrong. Best time to buy will always be now.

Stay tune to this blog for more info on Penang property market news!
You can just leave a message or pm me if you wish to know more about available housing projects in Penang!

W.