Property market saw gentle recovery in 1H18

KUALA LUMPUR: The Malaysian property market saw a gentle recovery during the first half of 2018 (1H18), following the strong economic growth momentum after the 14th General Election.

Estate agency, residential and commercial proper ty consultancy firm, Frank Knight Malaysia said active participation of key industrial and logistics players, both local and foreign, bode well for the local industrial property market.

In a statement yesterday, it said as the government continued ecommerce initiatives, demand for larger Class-A warehouse faci l it ies was expected to increase.

Malaysia Capital Markets Executive Director, Allan Sim said the industrial property sector presented a popular alternative asset class for developers and investors, in addition to traditional residential and commercial ( office and retail) markets.

“Moving forward, we expect to see more township developments with industrial components, business parks and logistics hubs being built,” he said.

On the residential segment, Frank Knight said market sentiment improved during 1H18 and Kuala Lumpur remained one of the well-liked destinations for property buyers and investors.

“During the first half, potential buyers and investors switched away from a ‘ wait- and- see’ approach and are now genuinely seeking good bargains in the market.

“This trend reduced the chances of a sharp correction in the residential property market as we expect stronger demand to continue and the oversupply situation to be less severe,” said Malaysia associate director of residential sales and leasing, Kelvin Yip.

He said developers are more aggressive in promoting their products and based on current trends, more transactions are expected in 2H18.

Commenting on the retail market, Retail Leasing and Consultancy Associate Director Rebecca Phan said retailers did not experience a major uptick in business during 1H18.

“Although the zerorisation of the Goods and Services Tax was good news, the impact was limited. While consumer goods among the mid- to lowerend market are showing good movements, it did little to boost up spending in the middle to upper-middle lifestyle segments such as fashion, beauty, and food and beverages,” she said.

Phan said consumers held back on spending due to uncertainties that may impact the economy.

“We expect the retail market to show clear signs of recovery in 2019, provided the economy performs well in 2H18,” she added. — Bernama