PROPERTYGURU Malaysia notes that asking prices for property have improved slightly in major markets in the country despite the unprecedented impact of Covid-19 and Movement Control Order (MCO) on industries across the board.
Its latest Property Market Index Report shows an overall marginal improvement in the first quarter, increasing 0.63% from 88.90 in the fourth quarter of 2019 to 89.46 in the first quarter of 2020.
The report further states that incoming supply dropped substantially by 10.47% over the same period, representing the steepest quarterly decline in three years as the MCO stagnated construction, listing and viewing activities.
“As necessary measures to stem the spread of the pandemic were put into effect towards the end of the first quarter of this year, the property market expectedly saw a sharp drop in activity across the board,” said country manager Sheldon Fernandez in a statement.
However, he said the moderation of price growth, as well as transaction volumes and values in recent years, may have had a buffering impact on the market.
“An upswing in asking prices in major metropolitan areas can also be seen in the first quarter, pointing towards a rise in interest in these areas as Malaysia takes a ‘soft-landing’ approach post-MCO,” he said.
According to the report, Selangor showcased the highest rise in asking prices, climbing 1.94% from 91.43 in 4Q19 to 93.20 in 1Q20, followed by Kuala Lumpur with a 1.81% increase from 94.90 to 96.62 over the same period.
While the time frame coincides with the onset of the Covid-19 outbreak and MCO in March, PropertyGuru anticipates the full effects of the pandemic to translate into steeper asking price drops in subsequent quarters.
However, it says the upswing points towards a strong interest in the central region, which is in line with increased investor activity in high-rise projects closer to metropolitan areas during crisis years.
Such assumption is further reflected in PropertyGuru Malaysia’s web traffic, with high-rises and condominiums ranging from RM900,000 to RM2 mil accounting for the majority of searches on the portal up to March and early April.
Meanwhile, Penang and Johor saw asking price downtrends continuing from recent years, though declines were at 0.13% and 0.59% respectively.
Penang saw its index fall from 95.39 in 4Q19 to 95.27 in 1Q20, while Johor saw the largest decrease across major markets, from 99.59 to 99.00 over the same period.
Healthy price movements in central areas were accompanied by steep drops in incoming supply, declining in Kuala Lumpur and Selangor by 11.53% and 10.19% respectively.
These patterns were also seen in other major markets to lesser degrees, with supply decreasing by 0.55% in Johor and 0.12% in Penang, said the report. -- May 13, 2020, Bernama