HEAVY BURDEN: Buying interest falls as a result of increase in house prices, says PropertyGuru
REAL estate portal PropertyGuru International (Malaysia) Sdn Bhd says the outlook for the property market does not look too bright from the buyers’ perspective.
This is the findings of its survey conducted at the end of last year involving more than 1,000 respondents.
The study shows a decrease in purchase intentions, with 68 per cent of potential buyers not satisfied with the increase in prices.
“As a result, buying interest dropped and interest in owning condominiums/apartments declined by nine per cent, the desire to own terraced houses plummeted 23 per cent and the demand for ‘other landed/commercial properties’ slipped 16 per cent,” PropertyGuru country manager Gerard Kho said yesterday.
Kho pointed out that property prices have increased by 30 per cent in the Klang Valley.
The average household debt is also a big issue that needs to be dealt with, he said, adding that the Malaysian household debt to gross domestic product ratio as at end-2013 was 86.8 per cent.
He also noted that in order to control the country’s rising household debt, simply relying Bank Negara Malaysia’s abolishment of the interest capitalisation scheme and Developers Interest Bearing Scheme, andbanks being required to fix their loan-to-value ratios based on a property’s net selling price rather than gross selling price, might not be enough.
He said one of the major problems lies in the rather slow supply of new houses because of the long approval process, resulting in first-time house buyers being burdened by large downpayments.
By BUSINESS TIMES
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