Let’s cut to the chase, 2020 didn’t go quite the way most of us predicted. If not for Covid-19, the world would have witnessed another Olympics, a European Football Championship and countless other major events. The pandemic no doubt threw a spanner in the works for most industries, causing adverse impact for the foreseeable future.
The real estate market in particular was affected by the health crisis with negative demand registered across various sectors according to a report by the New Straits Times. Still there were positive sparks from the property market such as in Selangor where the state recorded a positive demand for properties, spurred no doubt by the sheer affordability and appeal of areas such as Shah Alam, Puncak Alam and Cyberjaya.
As a New Year dawns, many expect the real estate market to rebound in 2021. For buyers, the property market in the months ahead may spring some positive surprises. Regardless if you’re a buyer, speculator or investor, here’s what the coming year could potentially deliver for the real estate market in Malaysia…
Great For First Time Buyers
The tabling and approval of the 2021 Budget has delivered several promising incentives targeted specifically for first-time home buyers. Amongst the main benefits that were rolled out by the Malaysian government are full stamp duty exemptions for those who are purchasing their first home. The exemption of stamp duties is for properties priced up to RM500,000, valid from 1 January 2021 to 31 December 2025. In addition, the government will also work alongside financial institutions to roll out Rent to Own (RTO) initiatives specifically for PR1MA properties and first-time buyers. The RTO scheme is expected to be implemented until 2022 involving approximately 5,000 PR1MA houses with a total value of RM1 billion.
Home Ownership Campaigns
As announced previously, the government is continuing to stimulate the real estate industry with the HOC 2020 (Home Ownership Campaign), which will go on until May 2021, adding further incentive for buyers of new homes. The government will also offer stamp duty exemption on loan agreements and memorandum of transfers (MOT) rescue contractors (new contractors who take on abandoned projects certified by the Ministry of Housing and Local Government) and original buyers of abandoned houses from January 2021 to 2025. This will no doubt help to expedite the completion of projects that have yet to be finished.
Lower Interest Rates, Better Deals
The continuation of the Real Property Gains Tax (RPGT) exemption for Malaysian owners who dispose of their residential property until 31 December 2021 will continue to incentivize sellers to dispose of their properties and attractive prices. In addition to Bank Negara lowering the overnight policy rate (OPR) to 1.75 per cent, which will effectively reduce interest rates for homes to about three per cent. This will provide buyers an opportunity to not only secure a property at an attractive price but with the added benefit of a lower interest rate and monthly repayment. It will also no doubt help clear the current overhang of developments in the market.
Stability & Growth Across Key Areas
Although the National Price Expectations Index remains on a downward trend with an expected 4.8 per cent reduction over the next year, some states are forecast to register growth over the two-year period. According to IQI’s Property Survey and Index Q3 2020, Penang and Perak are poised to see a price growth for properties of 15.9 per cent and 14.3 per cent respectively. Both Kuala Lumpur and Selangor also continues to appeal with a forecast price growth of 8.5 per cent, which secures their position as viable areas for real estate. Overall, the Malaysian real estate industry is expected to experience a market rebound over the next two years. With a forecast cumulative growth rate of 10.6 per cent over the next two years, securing a property in 2021 may well prove to be a wise investment.
This article is able to accommodate issues of economic status with knowledge of outbound as well as coverage of inbound situations in the market place which results a remarkable scene on financial aspects of business. Therefore, it’s useful in monitoring decisions by entrepreneurs to tackle fluctuating markets in their industry.
Agreed. Small & Big players require a “cutting edge” such as this!! Very good. Perfect!!
Searching for double story house
Which area? Buy / rent ?
Hi Thila, Elaine, which is yr preferred area ?tq
senang dapat
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