Market to consolidate in 2014.10

THE EDGE WEEKLY ISSUE#995

THE WEEK OF DECEMBER 30, 2013 – JANUARY 5, 2014

City & Country Section

LOCAL CONSULTANTS’ POLL: By THE CITY & COUNTRY TEAM

KH CHEN
MANAGING DIRECTOR
LANDSERVE SDN. BHD.

Outlook

We believe the Malaysian economy will remain resilient, although rising household debt and inflation can be a concern.  Thus, we expect the property market to soften in 2014 in response to the new cooling measures.

Nonetheless, such measures will not deter genuine homebuyers and investors with a long-term view.  We have clients making transactions even in December, some of which are at record prices.  Genuine property investors may be more cautious but they will never leave the property market.

As projects under the (ETP) gain traction in 2015 and 2016, prices in hot areas are expected to rise sharply.  That is why 2014 is the year to start looking and pick whatever “looks” good.  But always be well-informed.  Consult your property consultants or estate agents.

We still like landed homes in the secondary market because it has not been influenced by undue speculation, unlike the primary market.

In the Klang Valley, we like houses or strata homes in established schemes near any of the proposed MRT stations such as those in Petaling Jaya, Bangsar, Cheras, Kajang and Sungai Buloh.  Outside of Klang Valley, we like landed homes in major cities and towns like Rawang, Kajang, Bangi, Seremban and Melaka.  Towns that will have station on the proposed high-speed rail between KL and Singapore are expected to benefit.

In Penang, Tanjung Tokong, Pulau Tikus, Jelutong, Bayan Baru, relau and Sg. Ara are good areas.  For Sabah, Lintas, Kepayan, Tanjung Lipat, Luyang, Bundusan and Kolombong are our top picks.  In Johor, we like established schemes in Molek, Tebrau, Bukit Indah and parts of Nusajaya.

We hope the economy will stay resilient on the back of rising exports, foreign direct investment into the country and strong domestic activities.  Upgrading our country’s credit rating will be a plus.  While we expect inflation to increase in 2014 following the subsidy cuts and the electricity tariff hike, hopefully, it will be contained below 3.5% so that there will be no major hikes in interest rates.

Wish list

• Our banks to continue to be supportive in funding property ownership;
• Unemployment rate will stay below 3% and there will be no massive lay-offs;
• Foreign investors to return in a big way as Malaysia transforms into a developed nation by 2020; and
• Affordable homes under PR1MA and other initiatives by the government can be rolled out as soon as possible to help the low-to medium-income groups, with priority being given to first-time homebuyers.