DTZ's latest report suggests there will be positive times ahead for the sector if the state of commercial property is anything to go by. "While uncertainties over the date of the general election have evidently affected the pace and negotiation of transactions in the early part of the year, the trend in H1 proved that political consideration does affect real estate investments, at least in timing over the short term," DTZ explained to the Sun Daily. "Now that this is over, we can expect stronger momentum in government-linked mega projects such as Tun Razak Exchange (in Kuala Lumpur)."
This activity will have a knock-on effect for the residential market and DTZ expects more scheduled housing launches in the second half of 2013. In Q2, the release of new homes had been curtailed, as developers were unsure of the outcome of the general election. This affected the supply of property, driving up real estate values. PPC International Sdn Bhd chief executive Siva Shanker told Business Week that values in the main cities will increase by ten per cent in 2013.
Luckily, tighter controls on finance will help to keep growth in check, preventing a much-feared price bubble. Bank Negra Malaysia recently announced it will introduce maximum tenures for mortgage finance to prevent households from falling into debt. Finance for residential and non-residential properties will have a maximum tenure of 35 years. Finance extensions for personal use will have a maximum period of ten years, while pre-approved personal financial products have been banned.
Yet activity in the Malaysian market remains high and new properties are springing up across the country. Q2 saw 40 units completed in the Kuala Lumpa city centre compared with 1,442 units in Q1. By the end of the year, 2,704 units are expected to enter the market