PropertyGuru: Property Prices Down By 1.79% Y-o-Y In Q1

PropertyGuru has reported a downtrend in overall asking prices by 0.84 percent Quarter-on-Quarter (Q-o-Q) and 1.79 percent Year-on-Year (Y-o-Y) to 87.86 index points for the first quarter of 2021 in their latest Malaysia Property Market Index (MPMI) report.

Country Manager of PropertyGuru Malaysia, Sheldon Fernandez said the drop is due to buyer apprehension as a result of the resurgence of Covid-19 infections and the imposition of a second Movement Control Order (MCO 2.0), which has impacted commercial operations.

“With the backdrop of outbreak-related economic uncertainty, we believe that consumer sentiment will remain cautious in the coming months, as the property market is expected to see fluctuating price patterns.

“However, the increased rate of vaccinations among Malaysians will bring more stability and improve consumer sentiment as the year progresses,” Sheldon said.

He also stated that the Government’s decision to extend the Home Ownership Campaign (HOC) until the end of 2021 is a welcome boost for the industry as it will continue to play an important role in the consumer interest as the economy improves throughout the year.

“The HOC has proven to be an effective stimulus to the economy and it has undoubtedly helped to reduce the burden of house buyers during this difficult time.

“If the government does decide to extend the duration of the HOC until year-end, we encourage home seekers to take advantage of the available incentives, current low prices, and conducive interest rates,”  he said.

According to MyPropertyData, investors made up 79 percent of the property transaction in Malaysia last year, an increase of 38 percent from the previous year. The price correction trend observed in KL, Johor, and Penang may continue to spur this growth.

Meanwhile, the overall asking prices dropped by 0.66 percent, 0.29 percent, and 1.36 percent respectively Q-o-Q in Kuala Lumpur, Johor and Penang, while Selangor sees asking prices remain in the positive territory at 0.01 percent.

The overall asking prices in Malaysia have dropped both on a Q-o-Q and Y-o-Y-basis, in contrast, the MPMI found that the overall supply listings tracked on PropertyGuru saw a growth of 2.71 percent Q-o-Q and it also recorded a spike of 15.85 percent Y-o-Y in Q1 2021, the highest growth since Q1 2020, indicating an upward trend.

In Penang specifically, the state recorded the highest spike in yearly supply volume, registering a 34.17 percent Y-o-Y increase, and a 1.19 percent Q-o-Q gain a positive growth for the third consecutive quarter.

Sheldon said the property prices in these key markets are stabilising and adjusting to a more affordable range, and the continuous decline in asking price makes this a buyer’s market now.

“The price corrections across KL, Johor, and Penang represent strong opportunities for the investment and purchase of properties.

“Despite the current challenges, Johor has strong potential for the future due to its symbiotic relationship with Singapore and the geographic advantage it offers in terms of lower-priced properties.

“The robust turnaround of supply volume in key regions in Malaysia is likely due to the Government’s decision to allow the construction and property development industry along with other vital sectors to continue operating during recent periods of heightened movement restrictions,” Sheldon said.

Additionally, PropertyGuru said this indicates that developers are confident that recovery is on the horizon while the current environment of once-again eased restrictions offers room for improvement in Q2 2021, the property market is expected to put in a mixed performance for the duration of the year due to persistent uncertainties.

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