by FARA AISYAH & RAHIMI YUNUS/ pic by HUSSEIN SHAHARUDDIN
THE property prices in Malaysia will not be affected by the influx of Hong Kong buyers in the country although they are driving demand in the country’s real estate market.
According to Asiacap Valuer & Property Consultants Sdn Bhd property valuer Kit Au Yong, these buyers will not be able to absorb enough supply to move the market, unless the purchases surge like when the mainland Chinese came to acquire the units in Forest City, Johor.
“I doubt it can change the equilibrium of the market very much, based on the fact that Hong Kong is not a largely populated area like China,” he told The Malaysian Reserve.
In addition, he said the floor price of RM1 million is required for the Hong Kong buyers, and such sector certainly needs more demand today.
Au Yong said although there is certainly an increase of interest from Hong Kongers, it might be too soon to assess whether it has translated into sales.
VPC Alliance (KL) Sdn Bhd MD James Wong concurred that buyers from the Pearl of the Orient will not hike Malaysian house prices.
“There is a huge glut of homes in the country, and Hong Kongers are purchasing only a small fraction of this glut. It will not affect the overall oversupply situation in the residential market.
“They are also discerning buyers who have many friends, relatives and business associates in Malaysia, so they will check and compare the prices before buying,” he said.
Wong added that these buyers are not being treated any more special than local buyers as they are being offered the same discount and packages in the high-end market.
Juwai.com — the No 1 Chinese international real estate portal — said there has been a steady increase in demand from Hong Kong-based buyers wanting to invest in properties in Malaysia even as demand from China remains strong.
Juwai.com executive chairman Georg Chmiel said official Hong Kong government data shows that the number of locals seeking police checks has surged by 48%.
“These ‘good citizenship’ documents certifying that they do not have a criminal record are crucial to enable them to
apply for the Malaysia My Second Home Programme (MM2H) and other foreign visas. Applications increased 12% in June, 41% in July and 48% in the first two weeks of August.
“This is evident that many Hong Kongers truly are seeking to move to Malaysia for work or education. This will inevitably create new economic ties between Malaysia and Greater China,” he said.
He added that the data does not show with certainty that people are applying for these police checks for their foreign visa applications, nor specifically that all are applying for visas in Malaysia.
However, he said it is rare to seek these documents for any other purpose, and Malaysia is the top destination for Hong Kong buyers.
Chmiel said the top searched areas for mainland and Hong Kong buyers are Kuala Lumpur (KL), Penang and Johor Baru.
As such, he said, the delay in clearing the visa applications and the lack of information on when the new MM2H applications would be approved need to be significantly improved.
“We hope that with the upcoming Budget 2020, set to be announced in October, the government will look into reviewing the scheme to make it more appealing so that it can contribute to Malaysia’s international image and its future economic growth.
“Malaysia is a great investment destination, yet fewer than 3% of Malaysian properties are owned by foreign buyers. There is great potential to lure more investors and residents to grow the economy and ease the current glut in the property sector,” Chmiel said.