KOTA KINABALU – Sabah’s housing market is expected to experience its worst stretch this year primarily due to the effects of the Covid-19 pandemic, said the state’s Housing and Real Estate Developers Association (Shareda).
Residential property value slumped by 10% in the first quarter of the year and is expected to drop a further 15% in the second quarter, Shareda president Datuk Chew Shang Hai told The Vibes.
The drop in value did not translate to a rise in sales, Chew added, citing the state’s Home Ownership Campaign in June which only netted RM50 million in purchases, a 90% drop from last year’s campaign
“It is not a good sign. But if we could achieve half of what we did last year, we are already happy,” Chew said.
Shareda has had to postpone two exhibitions to next year due to the pandemic and the Sabah election.
The state’s rental market has also seen a shift, Chew said, with tenants moving out of expensive addresses and into more middle-class neighbourhoods, despite being offered discounts, primarily due to the coronavirus lockdown.
Tenants, he said, would move out of high-end luxury condominiums in Kota Kinabalu and move out to mid-range flats in Bundusan, Penampang.
But there are few positive signs, according to two property agents. Independent agent Joel Lo said there is still an appetite for affordable homes.
“Demand for affordable housing is the biggest one we encounter, especially from the HOCs. There’s an average of 15% to 20% in demand.”
Property Hub’s Enoch Khoo, on the other hand, points to a rationalisation of property prices.
“One positive trend we observe is property owners are more willing to let go of their properties based on market value and having more realistic pricing as compared to previously.”
But Khoo warned of continued downward pressure as a sizable number of South Koreans and West Malaysians may not be able to return to Sabah for work due to Covid-19.
Any upside, he said, would come from the availability of a vaccine, which would then spur market confidence.
But this, he estimates, would take at least up to 16 months for the state housing market to return to normalcy. – The Vibes, October 18, 2020
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