11MP mid-term review neutral to property

KUCHING: The 11th Malaysia Plan (11MP) mid-term review last week proved to be ‘neutral’ to the property sector, analysts note, given the lack of impact on public listed property developers.

According to the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research), the 11MP mid-term review is neutral to the property sector as the Government’s commitment in promoting affordable housing is not expected to impact public listed property developers.

“Exposure of property companies under our coverage to affordable housing project by the Government is limited,” MIDF Research said.

“Developers such as Mah Sing Group Bhd and UEM Sunrise Bhd built RumaWIP due to requirement from local authorities.

“We think that property companies may consider to participate in Government affordable housing project if incentives offered are attractive.

“We will only be able to assess the impact of the greater private sector participation in Government affordable housing project on public listed companies when details on the plan made available.”

As for the adoption of Industrialised Building System ( IBS) by property developers, the research arm noted that it is expected to gain traction due to the cost saving system.

“Meanwhile, financial schemes for first-time homebuyers should improve sales for property developers with properties project priced within affordable price range and high buyer profile of first-time homebuyers.”

Overall, MIDF Research maintained its positive view on the sector as demand for properties remains healthy.

It also noted that according to loan statistics released by Bank Negara Malaysia, cumulative applied loan for purchase of properties in the first eight months of 2018 8M18 grew 4.1 per cent year on year (y-o-y) to RM227.1 billion.