Malaysian home prices to rise this year

31-01-2012

Leading property developers in Malaysia expect home prices to rise over the next 12 months, based on a report from the Real Estate Housing Developers' Association Malaysia (REHDA).

The research reveals that three-quarters of REHDA's members believed that residential prices will surge this year, with 36 percent predicting an increase of between 10 percent and 20 percent, while one in three members expects an increase of five percent to 10 percent.

However, business optimism and confidence levels in the country's property sector are lower compared to six months ago, said REHDA.

"Our members are more cautious towards market conditions due to more compliance requirements imposed on the housing industry, global economic uncertainty and inadequate information and data with regards to on-stream demand and supply," said Datuk Seri Michael Yam, Association President.

Meanwhile, the proposed new mortgage scheme for the low- and middle-income household bracket can keep the capital "thriving, vibrant and youthful," said REHDA.

This is a commendable plan. However, its conditions and terms must be well drafted for it to be a success. Factors like income limits and geographic boundaries must be properly defined.

"Another thing that should be considered is risk management," noted Yam.

Last Saturday, Prime Minister Datuk Seri Najib Tun Razak announced a special funding scheme to help low- and middle-income families own a house in the capital, which will take effect on 1 March. This will cover units under the National Economic Action Council's People Housing Programme and the public housing programme of city hall.

Many young Malaysians have stated positive views about the proposed scheme.

"It can improve living standards for those in the city," said Asyraf Syahir, a university student.

"I hope the scheme's terms will be favourable because houses in Kuala Lumpur are expensive. I would like to own a house here someday," said Christine Leong, IT specialist.

Source