KUALA LUMPUR: Some enhancements in housing market activity are seen heading into 2022, though the variety of unsold homes remained excessive at 180,702 models within the third quarter (Q3) of 2021.
Disruptions brought on by the pandemic partly contributed to the slower clearance of unsold housing inventory regardless of ongoing residence buy incentives, mentioned Bank Negara Malaysia (BNM) in its Financial Stability Review (FSR) for Second Half Review 2021.
Nonetheless, the excessive variety of unsold homes continues to replicate pre-existing affordability points, which have worsened for the reason that onset of the pandemic as client incomes have been affected.
In this regard, the supply-side changes have continued with extra housing launches shifting in the direction of decrease and mid-price market segments.
The share of property launches priced at RM500,000 and beneath elevated considerably within the third quarter of 2021 (Q3 2021: 88.1 per cent; H1 2021: 67.7 per cent; 2015-2019 common: 65.9 per cent).
This ought to assist to cap an additional important enhance in unsold housing inventory, mentioned BNM.
Nonetheless, the majority of latest launches stays past the inexpensive worth phase, with solely 35.6 per cent of latest launches since 2015 priced beneath RM300,000, indicating additional room for worth and provide changes to enhance total housing affordability.
However, broader reforms to enhance housing affordability stay essential to comprise the debt burden of households and mitigate dangers of future monetary hardship.
Meanwhile, market activity is predicted to enhance within the fourth quarter (4Q) of 2021 pushed by the resumption of financial actions. Correspondingly, increased mortgage functions have been recorded throughout all worth segments within the second half (H2) of 2021.
The important enhance in mortgage functions within the last two months of 2021 coincided with the Home Ownership Campaign that ended on Dec 31, 2021.
Improving employment prospects and the low rate of interest atmosphere would additional assist housing demand.
Demand for housing was largely pushed by owner-occupiers, with 57.3 per cent (H1 2021: 55.8 per cent) of accepted housing loans within the second half of 2021 granted to owner-occupiers.
In the business actual property (CRE) sector, BNM mentioned the shift in the direction of versatile working preparations and the accelerated tempo of digitalisation arising from the pandemic will proceed to rework how bodily areas are utilised.
These tendencies might exacerbate current oversupply considerations in chosen CRE segments equivalent to workplace and retail areas.
Direct linkages between the CRE sector and monetary system are largely contained, thereby considerably mitigating dangers to monetary stability.
However, additional progress in resolving extra provide stays vital given the excessive multiplier results of the development sector on the broader economic system. Large deliberate incoming provide of workplace and retail areas continues to pose dangers.
For Malaysian actual property funding trusts (REITs), that are principally funded by massive institutional buyers equivalent to pension funds, this remained a nascent and small market, representing lower than 3 per cent of complete Bursa Malaysia market capitalisation. – Bernama
