REA Group Ltd, a global online real estate advertising company headquartered in Melbourne, Australia, believes that Malaysia can maintain its reputation as one of the key property safe havens in Asia.
The group’s chief economist Nerida Conisbee recently told Bernama that real estate investors generally want three things when looking at investment-worthy countries – strong economic growth, low political risk and high levels of transparency.
She said that while political risk continues to be a challenge for Malaysia, the global view on safe havens is changing, particularly with traditional markets such as the United States and the United Kingdom. Both countries are no longer looking safe following Brexit and the shock outcome of the US elections.
“What this means is that the traditional view of what is a safe market is likely to change in 2017 as investors look for other opportunities,” said Conisbee.
She pointed out that Malaysia has a low interest rate environment, which would attract more foreign buyers amid the weak economic outlook regionally and globally. If funds are easily accessible, then the low cost of borrowing can be a factor in attracting international investors.
“If economic growth continues to be strong in Malaysia, this will attract investment from overseas,” Conisbee said.
With more than 20 years of research experience in the Asia Pacific region, Conisbee believes that it is crucial for Malaysia to remain affordable if it hopes to spur further economic growth. Low levels of affordability would make living conditions difficult and less attractive, ultimately leading to economic stagnation.
She also suggested that Malaysia adopt a similar system to the Housing Development Board (or HDB) flats applied in Singapore, as it has been successful in being both affordable and providing a high level of homeownership.
Singapore HDB flats are home to over 80 per cent of Singapore’s resident population.