KUALA LUMPUR: Property consultant Rahim & Co is disputing claims that the Chinese presence in the country is a cause for concern, saying that they are not “overwhelming” Malaysia’s property sector.
However, for the sake of transparency, the company said the government should release data on the composition of foreign ownership of properties.
The state land offices would have the figures, so what the authorities could do is to compile those numbers, said founder and executive chairman Tan Sri Abdul Rahim Abdul Rahman (pic), who heads one of the oldest and most well known bumiputra property consultancy in the country.
Rahim said there was indeed Chinese developers and buyers in locations such as Bandar Malaysia and the southern state of Johor but one has to bear in mind that Chinese developers do have their own following and Malaysia does need foreign investments.
“Politicians will make all sorts of comments but I think there is nothing to worry about. There were also comments that Middle Eastern investors are going out. I don’t think they are going out but having said that, people do have a choice,” said Rahim at the release of its publication Rahim & Co Research – Property Market Review 2016/2017.
He shared that visitors from Saudi Arabia had been examining the market in view of the depreciating ringgit.
“We need overseas investments and it is not just from the Chinese but also from the Americans, the Japanese and others,” he said.
On the recent 1Malaysia People’s Housing Programme (PR1MA) offering a financing scheme in which buyers pay only monthly interest for the first five years and using one’s savings in the Employees Provident Fund, Rahim said “at least, he would have a house when he retires.”
PR1MA’s end-financing scheme aims for higher home ownership levels.
Rahim expects the market to be subdued for between 12 and 18 months. “It is a period of adjustment and price consolidation in closing the gap between sellers’ asking price and buyers’ expected prices,” he said.
In the residential segment, properties valued at RM5mil and above could see a drop in pricing between 5% and 10%, those RM2mil are expected to be relatively stable with a small increase in price while those RM500,000 is in short supply. Therefore, there will be pressure for demand for this segment.
The concern will be for the office segment as more large projects take off. This is “worrying” because the occupancy of office space will drop.
Average occupancy has dropped to 79% currently from the high 80% as total Kuala Lumpur office space supply of 90.8 million sq ft has pressured average occupancy lower to 79.7% in the third quarter of last year compared to the same quarter a year ago, when it was 81%.
He added that between 10 and 13 million sq ft of space were in the pipeline over the next four to five years.