By FARA AISYAH / Pic By MUHD AMIN NAHARUL
The property market will not be affected by the central bank’s hike in Overnight Policy Rate (OPR) by 25 basis points to 3.25% as it is not an enormous increase, said LBS Bina Group Bhd MD Tan Sri Lim Hock San (picure).
Lim said the interest-rate hike might impact the industry a little, but people will get used to it after some time.
“I don’t think there is any impact on the property industry at the moment. There was also no significant impact on the market when we had a hike in OPR previously.
“So, 0.25% is not a very big increase — the total loan repayment might be increased a little, but borrowers can absorb it,” Lim told the media after LBS Bina’s EGM in Petaling Jaya last Friday.
Instead, Lim said, the long overdue increase in OPR is beneficial for the country’s overall economy.
He added that raising the OPR will be advantageous for Malaysia’s economy as it will attract more foreign funds and directly strengthen the ringgit.
Touching on the gross domestic product, Lim said it is possible for Malaysia to reach more than 5.5%, and go up to a 7% growth this year.
He is confident that LBS Bina is on track to reach its RM1.8 billion sales target for 2018, despite the hike in OPR.
“We have achieved RM101 million in sales as of last Thursday.
“When we set the target of RM1.8 billion, we have already factored in the probability of interest-rate hikes in this year,” Lim added.
LBS Bina currently has 16 ongoing developments including 1Malaysia Civil Servants Housing Projects in Bukit Jalil, Batu Pahat and Alam Perdana, as well as Rumah Selangorku housing in Bandar Saujana Putra.
The monetary authority raised the OPR for the first time in 42 months as the global and domestic economic conditions favour such a hike and to curb the rising risk of inflation.
The interest-rate hike was expected as key economic indicators had been favourable to support such an increase. The ringgit appreciated 3.69% this year alone to RM3.88 against the US dollar last Thursday compared to a 12-month low of RM4.46 against the greenback.
Malaysia’s economy has also been bolstered by strong exports figures, better than expected economic growth and higher crude oil prices.
However, inflation risks have swelled in the last 12 months with the Consumer Price Index rising to 3.5% in December.
Inf lat ionary pressure peaked when the index, which tracks prices of a basket of goods, rose to an eight-year high of 5.1% in March 2017.
Global monetary authorities tend to resort to interest-rate hikes to curb inflation.