Upsides in property sector largely priced in, says Maybank IB


KUALA LUMPUR: Maybank Investment Bank Research believes there are limited upsides in the property sector despite a looming recovery as the positives have largely been priced in.

The research house, which has a "neutral" recommendation, remains optimistic that the sector is poised for recovery in 2021 due to low interest rates and pent-up demand that will lead to higher sales once the full lockdown is lifted.

"Stock prices could potentially overshoot our target prices on rotation into recovery or value-themed stocks but such gains are unlikely to be sustainable," it said in a note.

For 2Q21, Maybank IB expects a quarter-on-quarter decline in sales as the signing of sales and purchase agreements have been postponed until the FMCO is lifted.

It added that the industry is also facing stricter SOPs and a shortage of raw materials that lead to higher prices, which result in slower construction works.

In 1Q21, NAPIC statistics continued to show positive signals with property sales recovering 26% year-on-year but 6% lower quarter-on-quarter due to MCO2.0 imposed in January 2021.

The unsold inventory continued to improve, falling 10% q-o-q and 17% y-o-y in 1Q due to attractive rebates and discounts given by developers amid the low interest rate environment.

Maybank IB added that sales achieved under the Home Ownership campaign from June 1, 2020, to May 31, 2021 were better than in 2019.
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

Maybank IB Research , property ,

   

Next In Business News

Global silicon wafer shipments hit another record high in 2Q
June exports surge past RM105b, boost from trade with China, US
IDC data: China's Q2 smartphone shipments down 11%
Ringgit opens mildly lower on mixed US economic signals
China state media seeks to calm investor nerves after stock rout
China bond bulls unfazed by crackdown on capital markets
Bursa lacklustre after overnight decline on Wall Street
Maybank IB lowers earnings projections on Globetronics
Kenanga maintains 'outperform' on Kossan
Trading ideas: Kossan, Globetronics, DNex, VSTECS, AirAsia

Stories You'll Enjoy


Vouchers