News

Property sector moving forward on positive note in 2h18 - Axis REIT

Last update: 14/07/2018

KUALA LUMPUR, July 14 (Bernama) -- The property sector is expected to do better in the second half of 2018 (2H18), opposing the general perception of the bearish property sector, as the knee-jerk reaction due to 14th General Election subsided, Axis Real Estate Investment Trust (REIT) Head of Investments Siva Shanker said.



He said the total transactions improved by four per cent in January and February this year.



"Market hibernate around the election time as people are taking a wait-and see approach and later euphoria of the election has caused the market to go into a celebratory mood and as I talked to property agents, they said there are more viewings and enquiries now.



For 2H18 and 2019, we will see the market beginning to level out and starts its upward trend again, contradicting with the gloomy 2017, which saw the transactions as the bottom of “U” curve,” he told the audience at the “Property Outlook 2018 and Beyond: What now?”.



The session was part of the 4th Affin Hwang Asset Management Investment Forum held here today.



He elaborated that despite the higher household debt, residential loan applications improved by 15 per cent, while amount of loan approved increased by 15.9 per cent.



"However, the ratio of approvals and applications stood at 42.3 per cent," he said, adding that the number could be improved.



He said that more efforts should be taken to address the issue of first time house buyers, which in a way, could be addressed via easy lending and more affordable housing projects.



"There is no such thing as oversupply of affordable houses, it is under supply and we have to define what is affordable as it varies from one developer to another," he explained.



Shanker also said the residential units reportedly facing an oversupply issue were those priced between RM500,000 and RM1 million, as well as those in the small or home office (SOHO) and small office/flexible office (SOFO) segment.



Apart from it, he said that the market should start offering alternative asset classes investment, which included commercial buildings, as it would sooner become popular among investors.



"This would give importunity for millennials to buy a house while investors can still invest," he said.



-- BERNAMA