Impact Of Slower GDP Growth In The Property Market

Contributed By Sheldon Fernandez, Country Manager, PropertyGuru Malaysia

The slowdown in gross domestic product (GDP) growth to 4.3 percent is well below earlier estimates of 4.8 percent, and more recent projections of 4.5 percent. This is in line with our neutral outlook for property this year, with strong macroeconomic headwinds.

Slower economic growth translates to reduced accumulation of wealth, which is a prerequisite for home ownership.

As such, we anticipate further impacts to home seeker sentiment, though this may be buffered to some extent by Bank Negara Malaysia’s (BNM’s) timely Overnight Policy Rate (OPR) revision.

It should be noted that GDP expansion does not directly correlate to growth in the property market, with the latter influenced by other factors such as urbanisation, construction and demographical trends, typically following a cyclical pattern. However, the truism that a rising tide lifts all boats – as well as its inverse – applies.

Finally, while the recent global outbreak of the novel 2019-nCoV coronavirus strain has impacted supply and markets elsewhere, we see no direct impact on Malaysian property to date, though increased interest in domestic properties from international purchasers is possible in coming quarters, particularly in Penang.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest News

Bank Muamalat Approved 83% SME Payment Assistance Applications

With Covid-19 surge currently being experienced by the country seeing no sign of abating, many SME's who were already struggling during MCO...

Weekend Golf Getaway in Horizon Hills and Ponderosa

With Covid-19 looming, overseas travel is far and beyond anyone's wishes at the moment, but for frequent travelers keeping oneself locked up...

Coach Inspired By NYC Skyline

This holiday, Coach is updating its seasonal collection with the joyful release of its Coach 2020 Holiday Collection – the designs are...

Maxis Makes Top Management Changes After CTIO Departs

Maxis is seeing major changes in its top management, starting with the departure of its Chief Technology and Information Officer (CTIO), Morten...

Preparing for post-pandemic opportunities

Businesses in Malaysia must begin planning and preparing now to be able to leverage the opportunities that come with the eventual post-pandemic...

Must read

4 reasons why customer experience is the key to success

Vincent Tang, Regional Vice President, Asia, Epicor "Customer service" and "customer experience" are often used interchangeably. But there's a...

Deloitte report finds Malaysia among regional leaders in digital life adoption

An extensive survey conducted by Deloitte across age groups in eight countries in South and Southeast Asia showed that consumers aged between...

Malaysia needs to brand its startup ecosystem as one of world’s best, says KJ

Khairy Jamaluddin, Minister of Science, Technology and Innovation, said the country’s entrepreneurship ecosystem was on par with the world’s best, but Malaysia...

How today’s technology is key to industrial and manufacturing sector business continuity in a post-Covid-19 world

By  Dr. Ravi Gopinath, Chief Product Officer AVEVA , How the world does business was changing before the outbreak...