Property Prices Is Likely Come Down

Property prices in Malaysia are expected to come down this year reflecting the softer market and oversupply as global economic and financial crises dampen demand, said president of International Real Estate Federation (FIABCI), Datuk Richard Fong.

"The transactions have came down. The extent to which the prices will fall will also depend on the availability of financing now when the buyers are faced with financial difficulties due to job losses and uncertainties in the job market," he said at the 8th FIABCI Asia Pacific Regional Secretariat Summit 2009 here today.



Fong said to support the property market, banks should be flexible in restructuring the duration of housing loans to meet the financial requirements of house buyers who were struggling with their commitments.

"While the Malaysian economy is heading towards a pronounced slowdown, the banking sector remains relatively strong as compared to the 1997/98 Asian financial crisis," he said.

He said the financial and property sector would be in better shape when the global economy recovered and the effects of stimulative government policies and spending kicked in in the second half of the year.

Fong said the property market in Malaysia, as compared to Singapore and the rest of the Asean region, was also more stable as most of the property transactions in Malaysia comprised locals.

"In Malaysia, foreigners comprised only a small portion in property purchases. In Singapore, the market experienced a sharp drop in property prices, when foreigners exited the market and sell off their properties when recession hits the country," Fong said.

Earlier, secretary-general of FIABCI Asia Pacific, Kumar Tharmalingam, said while Malaysia offered the most attractive property investment return within South-East Asia, there were not much publicity and promotion and as a result Malaysian properties were not well-recognised among foreigners.

"We offer less restrictions as compared to other countries. Foreigners are able to purchase landed freehold properties while this is not possible among many countries in Asean," he said.