Covid-19, Politics and House Prices

Holistic measures needed to address the country’s overhang issue

There were high hopes for the property sector which stated at a low base in 2009 which became highly-unaffordable today. Hope ran high among those in the sector that the new government would help resolve some old issues including the lack of affordable housing and high prices.

The last 22 months showed otherwise although to be fair, there were attempts to get the sector on a more even keel.

“The latest hype was that foreign buyer from Hong Kong and other countries would come ‘to rescue’ us from our property from residential and offices,” says a source.  

Property tycoon Tan Sri Desmond Lim Siew Choon, who is building the Pavilion Damansara Heights is one of the beneficiaries. It is uncertain how others perform with respect to their Hong Kong outing.

But one swallow does not a summer make. The success of one developer does not mean others share similar success.

The property consultancy VPC Alliance Sdn Bhd managing director James Wong says “Many developers are selling 20% to 25% below launching prices by giving a lot of freebies. So, prices have dropped, although indirectly”.

“We are adjusting to a political transition and the events of the past one week are the normal birth pangs of a new government”, Wong says.

On the coronavirus (Covid-19) outbreak, Wong and another property consultancy PPC International Sdn Bhd managing director Datuk Siders Sittampalam concur that this too would be temporary despite loud global headlines that the number of cases is escalating in Italy, Iran and South Korea.

Siders said Covid-19 will impact Malaysia’s industrial property sector if the outbreak worsens. It has already impacted the retail and hospitality industry.

If Covid-19 is a double whammy, the current political situation is a triple whammy.

The sources say he understands there is “a reshuffling of the card” at the moment, but “put the right people in the right portfolio and we will be fine.”

 


VPC Alliance Sdn Bhd - James Wong



PPC International Sdn Bhd managing director Datuk Siders Sittampalam



Source: Thestar @ Biz Property