PropertyGuru: Malaysians view property as an investment hedge

PETALING JAYA: Malaysians see real estate as a hedge against inflation, with 53% of homeowners looking to buy an additional property next year and keeping their current property for investment reasons, according to PropertyGuru Malaysia’s biannual Consumer Sentiment Study for H1 2022.

From January to December 2021, the Statistics Department reported a national inflation of 2.5%, compared to a negative 1.2% in the same period of the preceding year.

PropertyGuru’s country manager for Malaysia Shylendra Nathan believes more Malaysians are turning to the housing market which presents a more attractive investment option given the emergence of inflation just as the economy started to recover from the pandemic, compared to the more 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 said in a statement today.

In their purchasing decision, the study found 55% of respondents are considering properties located in the outskirts of the city with quieter environment, better pricing, more greenery, and larger homes cited as the top reasons. It noted that the growing preference for homes outside of the city is a direct reflection of the remote working trend which was fuelled by the pandemic.

According to the study, one in three Malaysians surveyed said they are currently working from home and will continue to do so after the pandemic is over. Subsequently, this influences the perceived importance of home office space, with 79% of Malaysians believing it is vital to have an additional room when developing new properties, even after the pandemic.

Shylendra said that at first Malaysians were not sure if their companies’ work from home policies are permanent or merely a reaction to the mandated lockdown due to Covid-19. Now they are confident the arrangement is here to stay and is more open to moving to the suburbs 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,” he said.

On homeownership, consumers have called the government to provide support for them to overcome the barriers. The study found that non-property owners face difficulties in taking a home loan due to their unstable salary (47%) and inability to afford the down payment (41%).

One of the measures that 53% Malaysians want to see from the government is the extension of the home loan tenure from 35 years to 40 years, so that this can help reduce the monthly repayment thus enabling a higher home 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,” said Shylendra.