KUALA LUMPUR: Malaysia’s property prices will not fall as drastically as the prices of properties in Hong Kong, Singapore and Thailand next year.
Association of Valuers and Property Consultants in Private Practice Malaysia (PEPS) president James Wong said during the boom period, property prices in the latter three countries’ had risen tremendously over a short period while Malaysia’s only had a gradual appreciation.
“Hong Kong and Singapore’s exposure to the US economy also contributed to a more drastic price downfall during these difficult times,” he told a press conference yesterday on the second Malaysia Property Summit 2009.
The one-day summit, organised by PEPS, will be held on Jan 20, 2009, in Kuala Lumpur to discuss on the current issues and outlook of the property market in Malaysia. PEPS expects 250 participations next year against 175 this year.
Wong attributed the softening property market to lower consumer confidence level, with many buyers adopting a wait-and-see strategy in view of uncertain economy. The low and medium-cost properties would be affected more than the high-end ones.
“For the Grade A and strata title offices in the Golden Triangle, we do not think there is oversupply. The rental rates in this area are between RM7 and RM9 per sq ft,” he said.
“In the retail sector there could be an oversupply as there will be additional shopping centres to be completed next year. If the economy continues to deteriorate, the hotel sector will also be affected from fewer foreign travellers,” he said, adding that the domestic property prices would further moderate next year and were likely to recover in three years.
Sime Darby Property Bhd managing director Datuk Tunku Putra Badlishah concurred with Wong that domestic prices were not likely to drop drastically as profit margins of developers were already low and Malaysia had only experienced a gradual appreciation previously.
He said with the soft property market, it was even more important for developers to produce innovative and quality products.