by FARA AISYAH / pic by TMR FILE
THE property asking prices in Malaysia dropped by 1.34% quarter-on-quarter (QoQ) in the third quarter of 2020 (3Q20), against 0.38% growth in the previous quarter.
PropertyGuru Malaysia’s Property Market Index (MPMI) report revealed that all four key markets of Kuala Lumpur (KL), Selangor, Penang and Johor saw a fall in prices for the first time this year.
“With the latest implementation of the Conditional Movement Control Order (CMCO) after Covid-19 cases increased in a majority of states, PropertyGuru believed that under these new restrictions, current and future commercial activities will be impacted.
“This leads to a dampening effect on asking prices and the overall property market,” the proptech company said in a statement yesterday.
Johor registered the sharpest decline in 3Q20 where asking prices fell by 2.97%, while Penang saw a slight contraction of 0.64%.
KL and Selangor recorded weak figures as well with 1.35% and 1.04% contraction respectively.
On a year-on-year (YoY) basis, Malaysian property prices fell 1.49% against 3Q19.
The report also showed that overall new property supply rebounded and increased by 19.8% QoQ in 3Q20.
A 10.14% growth was captured on a YoY basis which indicates an upward moving trend.
Selangor recorded the largest increase in supply of new properties by 23.55% this quarter. This was followed by Penang (20.3%), KL (14.39%) and Johor (18.36%).
According to the National Property Information Centre’s Property Market Report for 1H20, the Malaysian house price index saw a marginal quarterly decline of 0.7% from 1Q20.
“With the loss of income and employment brought on by Covid-19, the property market and economy at large needs time to recover,” PropertyGuru Malaysia country manager Sheldon Fernandez said.
“The impact of the Covid-19 outbreak is undeniable, and it will take time to get the economy back on track as many Malaysians struggle with the loss of income and employment,” he added.
However, he said Bank Negara Malaysia’s move to extend 80% of loans for homes that are owner-occupied is expected to substantially reduce the likelihood of borrowers defaulting on their loans.
“Moving forward into 2021 with a climate of lower property prices, it is expect to see renewed interest and activity among younger buyers who have been actively saving for a property purchase, but have so far been priced out of the market,” Fernandez said.