PETALING JAYA: More than two-thirds of nearly 350 Malaysian real estate agents expect offshore buying of Malaysian real estate to return to pre-Covid levels within 18 months or by the end of 2023, according to a recent Juwai IQI survey.
Juwai IQI said in a report that within this subtotal, 15% of agents believe foreign buying will return to its previous levels as soon as the end of this year. Of those who think that foreign buying will only hit its previous levels next year, 30% believe that milestone will be reached by June, while an additional 23% believe it will reach that level by year-end.
Juwai IQI co-founder and CEO Kashif Ansari (pix) said the pandemic has almost passed and due to public sector support and the vaccination campaign, Malaysians have learned to cope with it.
He said the reopening of borders and the resumption of travel mean that foreign buyers are beginning to return. As a destination for foreign investment, Malaysia’s economy will benefit from the current global environment of commodity price growth, which sets it apart from many other Southeast Asian countries.
“Strong economic and employment growth is likely to lead to strong property market performance. As inventory is sold down and prices begin to rise, foreign investors will find the Malaysian market irresistible. Most investors want to purchase in a rising market, and few have the fortitude to buy when prices are falling.
“Since 2017, Malaysia has leapt from being Chinese buyers’ 10th favourite destination to their fifth. Australia and Canada have also become more popular with Chinese buyers during this time. This data from Juwai IQI is based on buyer enquiries made through our platform and agent network,” he added.
Kashif said Chinese buyers’ demand for Malaysian homes is at about one-third the level it was before the pandemic but has already begun climbing back up, The drop was due to a reduction in travel between the two countries. Even today, Chinese travellers who want to come to Malaysia have to undergo an extended quarantine upon returning home. As a result, most Chinese have avoided overseas travel.
He observed a similar increase in property market activity from Singapore-based buyers after the border with the neighbouring country reopened earlier this month.
“China’s borders remain closed but people are ready to move beyond the pandemic. When China’s borders reopen to free travel, the rebound in Chinese property acquisitions will gain pace as visits climb. There will be a fair amount of making up for lost time,” Kashif said in a statement.
The Malaysian home market remains appealing to buyers from across Asia due to the high quality of life on offer and relatively low prices. Buyers also believe that Malaysia has great potential for price and rental appreciation in the coming years, making this a good time to purchase.
The National Property Information Centre reported that RM18 billion of residential property was sold in the third quarter. The Q3’21 Juwai IQI Property Survey & Index said Malaysia found that foreign buyers account for 10% to 15% of new and second-hand transactions in Malaysia’s largest cities. It is estimated that foreign buying of real estate per quarter is in the range of RM1.8 billion, or RM7.2 billion per year.