Sabah Projected to See Biggest Swing in Rental Rates by 2022
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In the “Property Survey and Index Q3 2020” by Juwai IQI, the Malaysian real estate industry expects a strong market rebound in 2022 after a prolonged sluggish growth for the next 12 months.
Released in September 2020, the research company sees the National Price Expectations Index remains its downwards trend with a 4.8% fall over the next 12 months, before climbing again to post a cumulative growth rate of 10.6% over the next two years.
“Covid-19 and the resultant economic slowdown has had a significant negative impact on the real estate industry’s outlook for residential prices over the next 12 months. Residential prices are expected to fall nationally and in every state,” said the report.
The states with the strongest forecast price growth over the next two years are Penang and Perak, with price growth of 15.9% and 14.3%, respectively. Kuala Lumpur and Selangor have the lowest forecast price growth over the next two years with a lower but still impressive rate of 8.5%.
Meanwhile, the industry outlook is for rental rates to follow a similar trajectory as residential prices, by first falling substantially before recovering strongly. However, in the case of rental rates, the swings look less extreme.
“On a nationwide basis, rents are expected to drop 3.8% over the next 12 months, before recovering to post 7% growth through Q3 2022.
“Sabah is projected to see one of the biggest swings in rental rates, with an 8.7% drop in rents over the next 12 months before recovering to post 4.9% growth by the third quarter of 2022,” the report said.