The Malaysian property market, which is expected to enter the down cycle next year, will still be resilient enough to survive the onslaught of a softening global economy.
The government's RM7 billion stimulus package, including the reduction of Employees Provident Fund contributions from 11 to eight per cent, coupled with lower interest rate and inflation, will provide the bright spark to the market.
The market still has ample liquidity as banks continue to give out financing despite worries about an increasing credit crunch in the US.
Association of Valuers and Property Consultants in Private Practice Malaysia president, James Wong Kwong Onn, said although the property market was expected to see a slowdown in the take-up rate, there would not be a major correction as there was still room to grow.
He said Malaysia was in a better position compared to Singapore, Hong Kong and Thailand which were more exposed to the US sub-prime crisis.
Wong, however, said the association did not expect the market to burst as there would be a moderate reduction in property prices.
He said the property market, especially for residential and commercial, has been 'red hot' for three years up to the third quarter of this year but the softening economy has put a pressure on it.
According to Real Estate and Housing Developers' Association president, Datuk Ng Seing Liong, the property market would see a slowdown of between five and 15 per cent in 2009.
He attributed the economic slowdown as a dampener to the enthusiasm of buyers.
Ng said sales generally would be ongoing but in small volumes as most purchasers adopted a wait-and-see attitude while most developers downsized their new property launches for next year.
An analyst from Aseambankers Malaysia Bhd said buyers were holding back their investments until the economic environment was stable. He anticipates home buyers to return to the market in the second half of 2009. - Bernama
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