Share
Despite talk that the property market is seeing a slowdown and that prices for certain types of property are trending downwards, investors are still looking to buy real estate, albeit more cautiously.
“Investors feel sidelined and are very cautious mainly due to Bank Negara Malaysia’s new guidelines. Most of them are looking for good investments and the right product to come along. There is a lot of liquidity among investors, but they prefer to borrow and the guidelines are hampering that,” says Zerin Properties CEO Previndran Singhe (picture).
Bank Negara changed the bank loan computation from gross to net income from Jan 1 this year in an effort to curb household debt. Nevertheless, Previndran believes real estate is a much preferred investment in the current economic climate. He says local buyers are more affected by Bank Negara’s new guideline than by the current gloomy global economy.
“Surprisingly, the local economy seems robust with the rollout of the Economic Transformation Programme (ETP) and the government’s expansionary spending. Bank Negara has done what it thinks is right to protect the banks, but this may not be good for the short term as it affects liquidity, but for the long term, for example three to five years, it is a good move.
“I believe fiscal policies should punish the speculators on exit, for example via stiff real property gains tax, in the first and second years. Fiscal policies should encourage investment, not slow it down,” he says.
Still, there are a lot of properties out there for investors to look at, especially in hot spots like land-scarce Penang; Iskandar Malaysia in Johor; and Kota Kinabalu and Sandakan in Sabah.
In the Klang Valley, Previndran believes Petaling Jaya, the Kuala Lumpur city centre, Puchong, Shah Alam, Kajang, Sungai Buloh, Kota Damansara, Taman Tun Dr Ismail, Medan Damansara, Taman Desa and Cheras will continue to attract investors.
Previndran will be speaking at The Edge Investment Forum on Real Estate 2012. The forum, with the theme “Investing in Uncertain Times”, will be on April 28 at the Sime Darby Convention Centre in Kuala Lumpur.
In his talk, entitled “Property Market Overview and Outlook”, Previndran will offer his views on what investors can expect from the market for the rest of the year, whether it is a good time to buy and where, as well as the impact of measures to curb speculative buying and household debt.
This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 904, Apr 2-8, 2012
