Fri Mar 17 2023 07:45:31 GMT+0000 (Coordinated Universal Time)
Think it might be time to start shopping for a home?
Since the implementation of the Movement Control Order (MCO) on 18th March 2020, the real estate market seized up almost overnight. Now, with the recovery MCO well underway, the market is slowly coming back to life in various parts of the country. But buyers and agents will find that real estate hunting might look different than before the pandemic with stricter rules currently in place to minimise physical contact and prevent Covid-19 transmission. The rules about how showings and closings can take place and what agents can do will vary depending on local public health regulations, real estate association guidelines and individual comfort levels.
Masks, sanitizing wipes and temperature recordings are the new norms, which also includes personal data forms for contact tracing and limited viewing times to reduce contact hours between buyers and agents. These are the new realities of many industries, including real estate, and are likely to stick around while the virus remains a threat and a vaccine or cure is not found.
Maintaining the Buyers’ Market
The recent launch of the PENJANA Economic Recovery Plan included the revival of the Home Ownership Campaign (HOC) which included stamp duty and RPGT exemptions that are targeted to benefit both homeowners and investors. Moreover, many industry experts continue to predict that the market will continue to be skewed towards the buyers in the coming years before stabilising itself and swing to benefit the sellers.
As summarised by iProperty, by the end of last year, the number of unsold completed residential properties had soared above 45,000 units valued at over RM30 billion. According to the National Property Information Centre (NAPIC), this supply overhang has been growing in the last four years. This has created the current buyers’ market condition where those looking to invest in properties have the advantage. According to CBRE WTW’s Managing Director Foo Gee Jen, it may take more than five years for unsold residential units to be absorbed into the market.
As a buyer, you should also take into account whether you are buying a house to make it your home or for investment. These are very different reasons and will have different impacts on how you plan your finances. The best time to buy is when you are financially ready, regardless of how the property market is performing. We have listed several key points to boost buyers’ confidence that now is the right time to buy if they have the available resources.
Relooking at sales tactics post-MCO
The best way to sell a house is by creating a perception of value as commented by Mr Ikhram Merican, the Director of a property consulting firm, Living Space Ventures Sdn Bhd. Despite the low demand for available housing and high volume of property overhang, there are still buyers and investors who will be looking to capitalise on the soft market.
Charles Tan, founder of independent property blog kopiandproperty.com, opined that it is important to understand the reason to sell in the first place. Several key considerations need to happen before putting a house for sale such as the reason for selling which may be due to the need to settle some financial difficulties given the rate of job and salary cuts in recent times. Sellers will also need to consider that the property price would have undergone some form of readjustments to become lower than the median transacted prices if there is an oversupply in the area.
However, if the sellers are selling solely because the sentiment is negative, then it is best to just hold on and rent it out instead, he noted. Despite the current downtrend in market price, historical figures indicate that the property market will eventually climb again the economy recovers and buyers gain more confidence in their financial standings. Several considerations can be taken for sellers who are keen on putting their properties up for sale.