Malaysians’ ire over property prices at highest level, survey shows

A view of condominiums near Subang, near LDP. A condo costs RM500,000 on average in the Klang Valley. — Picture by Saw Siow Feng
A view of condominiums near Subang, near LDP. A condo costs RM500,000 on average in the Klang Valley. — Picture by Saw Siow Feng

KUALA LUMPUR, Oct 20 — Dissatisfaction over “expensive” home prices has increased to the worst level since 2013, with just one in four respondents of a survey expressing approval over developments in the property sector.

According to the poll conducted by real estate website propertyguru.com, respondents also felt that the government was not taking the necessary steps to rein in prices of homes, with 78 per cent blaming Putrajaya for rising prices — up five percentage points from 2013.

The severity of unhappiness also increased in the same period, with the group that was least satisfied with property prices nearly doubling from 15 per cent in 2013 to 27 per cent this year,

“Since the 1st half of 2013, there has been a constant decline in satisfaction among consumers. It has now hit the lowest thus far, with 75 per cent saying market conditions are unconducive. 

“Aside from the many reasons given, we have noticed another growing factor; with 1 out every three respondents citing difficulty in attaining approval for bank loans as a key source of dissatisfaction for them,” Sheldon Fernandez, propertyguru.com’s country manager, said in the accompanying release.

Sentiments were also expected to deteriorate further in the next six months, Fernandez added.

Although existing prices was the most-cited reason for the unhappiness, over half of respondents also said the “laggard economy” was contributing to their unease.

Respondents also blamed the Goods and Services Tax (GST) introduced in April for worsening sentiments in the sector, even though homes are exempted from the consumption tax.

Despite saying Putrajaya is not taking steps to mitigate the issue, fewer than one in three applied to join programmes introduced by the federal government to encourage home ownership.

While 36 per cent said they did not qualify for such schemes as the 1Malaysia Housing Programme (PR1MA), another 37 per cent said they did not try to participate.

“Expensive” home prices have become a perennial problem in Malaysia, with most Malaysians saying that property is virtually unaffordable to most wage earners, creating the risk that the country could face a “homeless generation”.

High and rising property value is also compounded by stricter lending rules introduced by Bank Negara Malaysia, which now considers borrowers’ ability to service all their debt when measuring their eligibility for additional financing.

Difficulty in securing home loans also appears to have weighed on the success of affordable housing schemes, with housing developers citing it as among the main reasons for low uptake of such programmes.

The propertyguru.com survey polled 1,483 Malaysians using online questionaires in the first six months of 2015.