5 Reasons for Property Market Recovery in 2021
Many people ask me if the property market recovery will happen in in 2021 since I wrote this article: Property market transactions for WP Putrajaya, KL and Selangor showing V-shaped recovery. By the way, property market recovery does not depend on property market alone. It depends on the economic growth, on the actions taken by the government, monetary policies by Bank Negara Malaysia and many other factors including a positive sentiment which encourages people to buy a big ticket item such as a home.
Below would be the reasons for property market recovery according to PropertyGuru.com Their full press release is here. These are the five reasons which will help the property market to recover in H2 2021. Please note, they predicted recovery only in H2 2021. Before then, we may have much more action than right now. Do read on for the 5 reasons.
1. Conducive interest rates to encourage homeownership
The Monetary Policy Committee (MPC) of BNM kept the Overnight Policy Rate (OPR) at 1.75% in its most recent review in November, citing significant improvement in economic activity during Q3 2020.
Lower OPR allows buyers to lock in lower interest rates favourable to current financial standings, especially those finding it difficult to fork out higher monthly loan repayments.
2. Continuation of mega infrastructure developments to create multiplier effects
The Budget 2021, which was tabled at Parliament in November, has seen the Government allocated RM15 billion to revive and ensure the continuity of several mega projects, such as the Mass Rapid Transit Line 3 (MRT3) in Klang Valley, Rapid Transit System from Johor Bahru to Woodlands as well as Pan Borneo Highway across Sabah and Sarawak.
Additionally, the development for Kwasa Damansara, a massive township bordering Kota Damansara and Sungai Buloh with a gross development value of RM50 billion, will create more than 100,000 jobs and have about 10,000 affordable houses.
3. HOC continues to spur buyers’ interest
The reintroduction of the government-initiated campaign has proved to be an effective measure to boost the market, which offers a number of incentives to homebuyers, and is expected to remain in play for much of the first half of 2021.
4. Property Technology On the Rise
One positive outcome of a pandemic-challenged property industry is increased innovation and a greater focus on digital solutions. Key property players have accelerated the efforts to market products and engage with buyers through online initiatives. This bodes well with millennials who are well versed with e-commerce habits and make up a large segment of the house buying market.
PropertyGuru hosted the region’s first largest multi-country virtual property expo which brought together 300 developers over 10 countries on one platform.
Other game-changers include data solutions, whereby easy access to real-time property transaction data would help create greater transparency within the property ecosystem – for buyers, sellers, agents, developers and financiers. PropertyGuru leads the fore with the recent acquisition of MyPropertyData.
5. Affordable housing for the B40 segment
The Budget 2021 revealed that the government will be focussing on affordable housing in the coming year, announcing several measures that will incentivise homeownership among the lower-income (B40) segment of the populace.
This measure will allow private developers to focus more on free-market housing while allowing the government to take the responsibility to provide more cohesive housing for the rakyat.
This article was originally published by Kopiandproperty.com