KUCHING: PropertyGuru Malaysia’s Property Market Report (MPMR) Q1 2023 highlighted that property prices grew despite declining buyer demand, expanding the buyer-seller gap.
PropertyGuru reported asking prices up 1.5 per cent QoQ in its news release on Thursday (Feb 16). Last year, the overnight policy rate climbed to 2.7 per cent, potentially boosting house ownership costs.
The Sale Demand Index declined 14 per cent QoQ, showing buyers may remain concerned about affordability or market prices.
Country Manager, Malaysia (PropertyGuru.com.my and iProperty.com.my) Sheldon Fernandez stated, “While the property market has sustained robust activity throughout 2022, our recent reports have shown that Malaysians are becoming more conservative when making important purchasing decisions.
“Inflation and rising borrowing rates have constricted purchasers’ budgets, causing sellers to hike prices to meet property investment costs.
“The price gap between both sides has grown, contributing to the house affordability crisis we’ve been observing for a year.”
The Renting Demand Index reached 32.9 per cent in 2022 as potential homeowners rented due to rising property costs, diminishing demand. PropertyGuru’s rental listings rose 19.6 per cent as landlords sought alternative income to combat inflation.
According to the Property Market Report, Q4 2022 rental demand declined four per cent QoQ after successive increases. Rental costs grew 2.8 per cent QoQ last year, which may have dampened rental demand.
Malaysian industrial rental premises would expand after the government eased industry restrictions to speed up foreign worker hiring.
After three quarters, Malaysian home prices increased 1.5 per cent in Q4 2022.
This rising trend should continue as homeowners raise dwelling prices to offset higher lending rates.
In 2022, the Malaysian economy increased 8.7 per cent YoY, the most since 2000, according to the Ministry of Finance (8.9 per cent). Q3 2022 unemployment declined to 3.6 per cent from 4.2 percent in Q1.
Due to economic improvements under the new government, property owners felt less pressure to sell.
“As the Malaysian economy increases four to five percent in 2023, the property market should strengthen. Year-end holidays and festivities may have impacted Malaysia’s homeownership plans, lowering sale and rental demand in 2022.
“Property players should consider home affordability and expect sales demand to drop in the first half of the year.
“Many Malaysians are waiting patiently for government support in the next re-tabling of Budget 2023 and an improvement in inflation before making their significant acquisition.”
