Pasdec: Rising cost of living, tight financing to continue impacting property market
KUCHING: Issues of affordability, rising cost of living and tight financing are still expected to impact the property market in the foreseeable future, Pasdec chairman Dato’ Sri Adnan Yaakob commented in his statement in the group’s annual report 2017.
According to Adnan, despite the improvement in the domestic economy in 2017, Pasdec along with many other companies in similar industry had to contend with the still sluggish private and public sectors demand mainly due to bank lending restraints throughout the year.
“Even though developers have taken steps to address weaker sales number and falling revenues by lowering down prices and turning their focus on affordable housing segment, issues of affordability, rising cost of living and tight financing are still expected to impact the property market in the foreseeable future,” he said.
Adnan highlighted that in the year 2017, the Malaysian economy registered a robust growth of 5.9 per cent, compared to 4.2 per cent in 2016, as private sector expenditure continued to be the primary driver of growth with additional impetus from an improvement in external demand.
He went on to highlight that improvements in labour conditions and wage growth drove private consumption and domestic demand while public consumption grew by 5.4 per cent, compared to 0.9 per cent in 2016, due to higher spending on supplies and services by the Federal Government.
“The property market saw unsold completed units hitting a high of RM12.3 billion in the first half of 2017, up 40 per cent from the previous year same period.
“The Central Bank of Malaysia announced in November 2017 that the property glut in Malaysia reached its highest level recorded in the past 10 years.
“From the almost 150,000 unsold properties nationwide in 2017, 83 per cent were priced above RM250,000 and 61 per cent were high-rise properties.”