PETALING JAYA: Despite the three stimulus packages announced by the government and two overnight policy rate cuts by Bank Negara, the residential, office and retail property market outlook is expected to be sluggish this year in the wake of the Covid-19 pandemic.
In Sime Darby Property Bhd’s annual report 2019, it said that buying sentiment in the residential market could be hurt by rising job cuts and global recession, posing risks to the recovery of the residential property market.
“In the absence of real estate-related interventions such as a reduction in the real property gains tax (RPGT) rate or extension of the Home Ownership Campaigns (HOCs) to directly encourage demand, the market will continue to be subdued, leading to potential price adjustments to address stalled demand, ” it added.
Looking ahead, Sime Darby said developers will focus on launching “demand-driven” products with a tailored pricing strategy, as they will be cautious about the scale, pricing and pace of their projects.
For the office market, it noted that the demand is likely to be driven by the trend of existing tenants’ relocations in the short to medium term.
However, in the short term, Sime Darby expects the office investment market to not gain any traction, as investors will remain highly selective due to the poor market sentiment, large existing and future supply, limited office demand, poor rental growth prospects and an overall prolonged slow market.
Sime Darby noted that the Covid-19 pandemic may adversely impact the demand and rental growth of office space due to the shuttering of businesses and restricted social activities.
On a positive note, although there are signs of a slowdown this year, it added that the fundamentals in the office market remains firm as high-growth tech, creative and business services companies continue to drive occupancy rates.
Besides that, Sime Darby said the retail market outlook is expected to be gloomy, as the pandemic is causing retail sales growth to deteriorate this year.
It added that the impact on the retail sector is more severe in the case of malls and rental contributions that are contingent on tenant sales and urban malls that have exposure to tourists.
“Leasing conditions are, however, expected to remain challenging with slowing or no short-term rental growth, curbed by downward pressure on profitability and a slow rebound in retail spending growth, ” it added.
https://www.thestar.com.my/business/business-news/2020/04/29/real-estate-to-remain-subdued
Created by savemalaysia | Nov 17, 2024
Created by savemalaysia | Nov 17, 2024
Created by savemalaysia | Nov 17, 2024
Created by savemalaysia | Nov 17, 2024
Created by savemalaysia | Nov 17, 2024
Created by savemalaysia | Nov 17, 2024
Real estate prices will go back to 2008 levels as banks will not provide anymore cheap credit to support higher prices.
2020-04-29 15:27
DickyMe
REAL ESTATE INDUSTRY must be banned!
It is this industry which caused enormous problem for humans.
Without REAL ESTATE people were free and happy.
2020-04-29 12:12