PETALING JAYA: The property market outlook remains stable despite the spillover effects from the global trade war unleashed by US president Donald Trump impacting investor sentiment, says MIDF Research.
It said the overall higher loan applications in the first quarter of 2025 (1Q25) signalled that property buying interest remained healthy on the back of Bank Negara data showing total loan applications increasing 15.3% month-on-month (m-o-m) to RM54.6bil in March following a 6.1% rise m-o-m in February.
Loan applications for 1Q25 grew 2.4% year-on-year (y-o-y) to RM146.6bil.
“The stronger loan applications in March are in line with our expectations of a recovery following weaker figures in January which are believed to have been dragged by school holidays and the Chinese New Year public holidays,” it said.
It expected the loan-approved ratio to normalise amid new property launches despite the marginally lower 1Q25 approvals of RM59.8bil, which were down 0.6% y-o-y.
It noted that the KL Property Index was volatile in April following the announcement of the Liberation Day tariffs by Trump on April 2, with the index declining 3.2% for the month against the local bourse’s benchmark KLCI’s 1.8% gain.
The less optimistic economic outlook had affected sentiment on big ticket items including property purchases.
“Nevertheless, the outlook for the property market in Malaysia should remain stable especially in Johor mainly due the Johor-Singapore Special Economic Zone and Johor Baru–Singapore Rapid Transit System,” the research house said, noting that the number of property developers who have increased their exposures to the state’s property market.
The research house, which has maintained a “positive” stance on property stocks, expected better earnings for property developers in the upcoming 1Q25 financial results season supported by decent sales last year.
Its top stock picks with “buy” calls among developers include Mah Sing Group Bhd
with a target price (TP) of RM1.49, Eco World Development Group Bhd (TP: RM2.05) and UOA Development Bhd (TP: RM1.93).
