KUALA LUMPUR, Jan 18 — Local property developers are likely to venture more into affordable housing that is high in demand despite cooling elsewhere in the sector, according to real estate firm CBRE|WTW.
Its managing director, Foo Gee Jen, also said property remained a more popular investment destination in the country than most other sectors.
“The good side is a lot more developers would be venturing into affordable housing.
“And generally if the government pushes up the supply of PR1MA homes and others, I think residential part will see a slight improvement but overall commercial and other segments will be very flat,” he said at the presentation of CH Williams Talhar & Wong’s 2017 Asia Pacific Real Estate Market Outlook.
He said, however, that consumers were responsible for dictating market prices in the sector that is rife with complaints of unaffordable property.
Foo explained that developers would have no choice but to discount if demand was not present for their projects or shift attention to segments that are under supplied, such as affordable housing.
“I believe it starts happening. A lot of them are suffering as some of the high-end products are not selling. So they have to make sure they are selling products that are acceptable to the masses, what the public wants,” he said.
Demand for small and flexible offices (SOHO/SOFO) were also set to fall by up to 15 per cent compared to 2015, he said before adding that the decline could last another three to four years.
Foo added 2017 would be a challenging year for developers as Malaysian consumers become savvier.
This will be exacerbated by other factors such as the weak ringgit, commodity prices and markets elsewhere.
