The Real Estate Sector Is In For A Tough Time
According to Knight Frank Malaysia’s (KFM) half-year real estate report, the real estate market in Malaysia, including high-end condominiums, may face tougher times ahead.
The report inspects the market performance across the property mix of residential, office and retail, and highlights the trends and outlook in four key markets in Malaysia — Kuala Lumpur, Penang, Johor Baru and Kota Kinabalu.
Growth was still expected in the real estate market despite the cloudy outlook for other market sectors due to the weakening in the domestic economy and global uncertainties.
This is because the country’s economic growth would continue to be driven by significant increase in construction activities, in particular infrastructure projects.
These infrastructure-related projects will inevitably shift the focus of future developments, Sarkunan Subramaniam, Knight Frank Malaysia’s managing director, said.
More developments can be expected across various transportation routes as more people start taking public transport, said Sarkunan.
Klang Valley commuters would enjoy better public transportation once Phase 1 of the Mass Rapid Transit Sungai Buloh-Kajang Line begins operation by end of 2016.
“Penang is benefiting from the RM337 million Bayan Lepas Expressway that was opened to traffic in early April. Sabah is also set to benefit long-term from big infrastructure projects, such as the Pan-Borneo Highway and Bus Rapid Transport system,” he said.
It was also highlighted that the high-end condominium market would remain lacklustre as potential buyers and investors continue to adopt a “wait-and-see” approach.
Due to the attractive currency and competitive rental rates, more multinational corporations from marine and offshore sectors were enticed to relocate to Malaysia, said the report.