Malaysians still keen on property investment as hedge against inflation

KUALA LUMPUR – 53% of Malaysians are still keen on buying extra property in the coming year citing investment reasons.

The data released by PorpertyGuru Malaysia’s biannual Consumer Sentiment Study for H1, 2022, found that locals are viewing real estate as a hedge against inflation.

The Department of Statistics Malaysia revealed that there was a significant increase of 2.5% to the national inflation for January to December 2021. This was compared to a negative 1.2% for the same period in 2020.

PropertyGuru.com.my and iProperty.com.my Country Manager (Malaysia), Shylendra Nathan said that the company believes more Malaysians are turning to the real estate as an attractive investment option.

“With the inflation as Malaysia is starting to recover from the pandemic, we believe Malaysians are choosing the housing market to invest in as an alternative to the uncertain stock market.

“Our Consumer Sentiment Study also found that more than half of the total respondents (55%) expect property prices to increase post-COVID-19. Hence, it is no surprise that those who have the means to are considering purchasing an investment property, especially in this current low interest rate environment,” he added.

Post-COVID Home Buying Trends

The study showed that 55% of house seekers are looking towards properties around city outskirts. Several top reasons for these were because of the serene environment, affordability, more greenery, and larger sized housing units.

The incline towards properties outside the city centre is attributed to the remote working trend fuelled by COVID-19.

The study showed 1 in 3 Malaysians surveyed said they are working from home and will continue the arrangement after the pandemic is over. This shows the importance of having home office space.

79% answered they believe it is vital to have additional rooms when new properties are developed, even after the pandemic.

“At the start of COVID-19, Malaysians weren’t sure whether their companies’ work from home policies are permanent or just a reaction to the mandated lock-downs. Now that they are confident the flexible working arrangement is here to stay, more Malaysians are open to moving to the suburb to enjoy larger spaces at lower prices.

“A longer commute to the office is an acceptable compromise for them if they don’t have to make the trip daily, as the advantages of living in the outskirts of the city still outweighs the drawbacks,” Shylendra said.

When it comes to the process of homeownership after pandemic, 2 in 3 respondents said they would be comfortable shortlisting and viewing the properties online.

10% of Malaysians are comfortable conducting the homeownership process online. These respondents are hoping that the property industry would accelerate digitalisation to meet evolving consumer behaviours.

Hurdles in Buying Homes

The study showed that the various government initiatives such as loan moratorium and Home Ownership Campaign (HOC) benefited both the homeonwners and seekers category.

46% of respondents said the moratorium helped them manage cost of living with 26% saying they rebuild their savings with the moratorium.

Meanwhile, the Real Estate and Housing Developers Association (REHDA) reported that HOC contributed to 73,503 residential sales worth RM47.38 billion after discounts between June 2020 to Sept 2021.

Consumers have called for government initiatives to help those unable to purchase houses.

According to the study, non-property owners said they have difficulties securing home loans due to inconsistent salaries (47%) and inability to afford for down payment (41%).

53% of the respondents hope that the government would extend housing loan tenures from 35 years to 40 years. This is to help reduce the monthly repayment sum and enables higher loan eligibility.

“Only 12% of Malaysians perceive that the government is doing enough to make housing affordable in the country, which is the lowest score recorded by our Consumer Sentiment Study since 2017.

“As Malaysians are just starting to get back on their feet and slowly rebuilding buyer confidence after persevering through the pandemic, more incentives are needed to help spur the property market. We at PropertyGuru, are committed to supporting both the government and consumers alike to help more Malaysians own their dream homes wherever we can, with the right resources and data-driven insights,” Shylendra explained.

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