Fewer Hong Kong house buyers eyeing Malaysia now

by FARA AISYAH / pic by TMR

THE number of Hong Kong property buyers purchasing Malaysian real estate has slowed compared to the earlier days of protest in the special administrative region, Malaysian Institute of Estate Agents (MIEA) CEO Soma Sundram Krishnaswamy said.

“Based on the feedback from MIEA members, there was a big influx of Hong Kong buyers into Malaysia, (but) right now after a few months, it has slowed down,” he said at the PropertyGuru 2020 Market Outlook Forum in Kuala Lumpur (KL) yesterday.

The government’s move to lower the house price threshold for foreign buyers to RM600,000 from RM1 million won’t have any serious impact on the domestic property market, he added.

“They (foreign buyers) would go for main areas, for example the KL city centre, where you can’t get a property at that price,” Soma said.

Hong Kong buyers come to Malaysia because of what happened there and not because it has been a traditional foreign market in Malaysia, according to Jones Lang Wootton ED Prem Kumar.

“A number of developers I know have actually quite a number of Hong Kong buyers, for units above RM1.5 million in good locations such as KL.

“That trend is continuing. How long it is going to continue is depending on the situation in Hong Kong. If the situation improves, we might not have that kind of influx anymore,” he said.

On the other hand, there are buyers from China coming to Malaysia to buy units of a project in Genting Highlands, Pahang, Prem said.

Soma concurred, adding that he expects the influx of China buyers into Malaysia to continue.

“There is one project targeting China buyers into Malaysia. That is the trend. I think China buyers will come because there is too much money in the country,” he said.

The Malaysian Reserve (TMR) reported in August that buyers from Hong Kong bought local properties worth over RM500 million since the protests in Hong Kong began.

Speaking to TMR, VPC Asia-Pacific property consultant Bruce Lee said Hong Kongers snapped up at least 300 units to 500 units in KL and Johor since June.

Meanwhile, PropertyGuru Malaysia country manager Sheldon Fernandez said the outlook for the property market for the first half of 2020 (1H20) is neutral.

“We will see the same downward trend in asking prices. It depends on how rentto-own schemes fare in the market and the impact of lower threshold for foreigners. “People will wait and see the market performance in 1H20 before deciding their actions,” he said.

Homeowners and sellers are adjusting their asking prices downward amid mixed macroeconomic indicators as the national Home Ownership Campaign draws to a close, according to the PropertyGuru Market Index (PMI) for the third quarter of 2019 (3Q19).

The overall PMI for the country declined 0.9% year-on-year (YoY) and 1.2% quarter-on-quarter (QoQ) in 3Q19, underscoring bearish sentiment among industry stakeholders in both the short and long term.

Asking prices in most major Malaysian markets, including KL, Selangor and Penang, saw similar QoQ decreases and long-term declines, the PMI revealed.

However, Johor recorded a marginal growth of 0.3% YoY and sideways QoQ movement in 3Q19.