Sherry Koh of the online STAR did a survey on some professionals as what would be the outlook for the property market in 2011.
While most developers talk about the positive effects of the government economic transformation programmes, the view of related parties were more credible.
5SM Faliq of Naza spoke of their signature project around the Matrade building. As usual, he was buoyant about prospects in 2011 and perceive a good demand pattern in spite of the government's loan to value cap on third banking loans.
Another developer, the Sunway Group remains optimistic as well. Citing steady employment rate, ample liquidity and attractive financing packages, it demeed property still be the preferred inflation hedge. He cautioned that though demand will remain strong for landed residential properties, it will be confined to certain strategic locations in the Klang Valley. The shortage of supply especially in good locations will command good secondary prices while new launches will be much sought after.
It does not expect property bubbles as there are limited supply of land is limited in prime areas and
the availability of liquidity at the banks and institutions such as the Employees’ Provident Fund (EPF). Moreover,the latest round of quantitative easing by the US will see some funds inflow to this part of the world.
The Sunway people believe the current demand for lifestyle living will help many developers launch such schemes. They expect the trend to persist. Today, developers are also designing houses with larger built-ups and surrounded by lush greenery to accommodate families wanting a green and spacious living environment, away from the hustle and bustle of city life. Security is another important factor which explains the demand for gated and guarded projects. Homebuyers will be attracted to new lifestylefeatures that are aesthetically pleasing and functional at the same time.
If 2010 is indicative of improved market conditions and a good year due to return of market confidence, Sunway believes 2011 will display positive progress with vibrant and competitive outlook chiefly, due to strong offerings from developers for customers.So, to them, quality properties remain a safe and solid asset class.
Now, let us look at the view from the National House Buyers Association. It’s spokesman, Chang Kim Loong has this to offer.
“Unless the Government does more to curb excessive speculation, property prices especially in urban and even sub-urban areas,house prices will continue to rise beyond the reach of many wage earners, especially those fresh into the work force or about to start a young
family. Even middle income wage earners with joint salaries are unable to buy in.
One should notice that the pay cheque increase does not commensurate with the increase in
prices of residential property. People buy in on the premise that economy is growing or allegedly to be increasing. In an event of a downturn it would trigger a snow ball effect. Ask the man-on-the-street; don't just seek opinions of parties with vested interest i.e. developers, builders, real estate agents, property consultants who are property sellers”.
This is very sane advice!
Now, let us look at what the real estate people has to say. Reapfield Properties, Gerard Kho
Expects the property market to remain buoyant and vibrant in 2011. He felt that it was difficult to
specifically predict how much the market will continue to grow but he believes the market is sustainable
as there are many rosy factors
Firstly, inflation is going up and so will building materials go up in price. Secondly, there is upward pressure o nwages. Next, in-migration into urban areas calculated to be 3 million people into the Greater Kuala Lumpur area will cause housing pressure. Fourthly, improved infrastructure development such as the LRT and good networks will ensure growth. Finally, there is government stability. This will ensure investor confidence. The property market has been and will be a driver of the home economy. The real estate agency hope that banks can do their job in the area of home financing despite the LTV factor.
Let us have anotehr view from the real estate people. This time Sherry spoke to Khoo Boo Tee of Newfields Property.
Khoo feels that last year’s buying momentum is still there and should continue. He expects a steady trend .
His reading is that developers will still be launching new projects and people will still be buying. Most buyers will live in their newly bought homes. He does not see any adverse effect from the government LTV measure.
Khoo is of the opinion that the threshold population is there. Looking at the Economic Transformation Program (ETP), he envisaged the population in Kuala Lumpur to be approximately 10 million by 2020. The current population is possibly 6 million, he added.
So, he sees a good property market in 2011.
So, that my friends,is what the picture for property in 2011.
Are you buying?
