“We are likely to see property developers adding value (to their projects or units offered) and the asking prices on properties will decrease,” said PropertyGuru Malaysia country manager Sheldon Fernandez.
Apart from that, he said, the financing environment would also be more conducive, thanks to Bank Negara Malaysia’s (BNM) overnight policy rate (OPR) cuts, compared with eight to nine per cent or double-digit rates in the past.
On the other hand, he cautioned that buying property requires long-time commitment and investment.
“Therefore, it may not be a good option if one cannot afford it over a period of time, although prices are expected to fall in the short term post-COVID-19, with prospects for recovery in the near future,” he said in a virtual conference on “To Buy Or Not To Buy Property Post-COVID-19?” organised by PropertyGuru Malaysia.
He said although the government recently announced a few measures to assist the people such as the moratorium on loan repayments and the restructuring of outstanding credit card balances for six months, these are not suitable for those seeking a short-term solution.
Looking back at the 1997/1998 Asian financial crisis, he said high-rises and terrace houses were the more resilient types of property compared with others throughout the crisis and recovery period.
Nonetheless, he said, the result may not be the same for post-COVID-19, as this is an unprecedented situation never been experienced before.
On March 3, BNM cut the OPR by 25 basis points to 2.50 per cent. The ceiling and floor rates of the corridor of the OPR were correspondingly reduced to 2.75 per cent and 2.25 per cent, respectively.
With more domestic liquidity and a sharp fall in loan applications, banks and financial institutions will be looking for quality borrowers, according to another panelist, MyProperty Data chief executive officer Joe Hock Thor.
“The current conditions may favour speculative investors as they have the options to secure good assets. The only factors are demand and time. I also believe the decreasing prices and low-interest rates will lead to an improvement in rental yields,” he said.
On the technology front, he said it is important for property industry players to adopt the Industrial Revolution 4.0 to future-proof their property business transactions and volume.
“However, regardless of the use of advance technology such as virtual or augmented reality and artificial intelligence, the need for physical human touch would still be required to detail out certain needs by clients,” he added.