Demand for secondhand property for the year 2020 was better for cities outside Kuala Lumpur, an overview of subsale property demand by property site iProperty.com shows.
According to iProperty’s 2020 Property Demand Analytics, the cities of Shah Alam and Seremban recorded positive demand of +1.7% and +0.9% respectively while demand for subsale property in the Kuala Lumpur City Centre contracted by -8.9% with an 11% decline in capital growth.
“The property demand for Kuala Lumpur dropped by -1.3% with apartment and flat user visits declining as well, as one of the groups hardest hit during the Covid-19 pandemic is the B40,” REA Group Asia general manager of customer data solutions Premendran Pathmanathan said in a presentation today.
He added that the suburban areas in Selangor had benefitted from the population outflow brought on by the pandemic.
On the higher demand for subsale units outside Kuala Lumpur, he said several factors are involved including an increase in population migration and the new trend of working from home.
This has seen people moving to affordable housing areas in the suburbs of Selangor and other states, leaving Kuala Lumpur’s property market muted.
“These residential suburbs offer larger properties with better value for money and have seen some of the fastest growths in demand,” he said, listing districts such as Puncak Alam, Dengkil and Semenyih.
Selangor has been the only major state to record a positive demand in subsale property since the start of the pandemic, with Serendah chalking up the biggest growth in demand in 2020 due mainly to apartments and flats priced below RM100,000 and with built-up spaces of below 750 square feet.
Meanwhile, cities like Kepala Batas and Balik Pulau in Penang and Muar, Batu Pahat, Iskandar Puteri and Kluang in Johor have also attracted buyers, contributing to the overall trend of subsale property demand in 2020.
Premendran said the decline in property demand in Kuala Lumpur was expected sooner, when the movement control order was implemented.
“The Covid-19 pandemic has shifted the way everyone lives and works, and 2021 will be a challenging year as the property market is dependent on the economy of the country,” he said, adding however that the property market would likely recover once vaccines have been rolled out.
He also spoke of government efforts such as the extension of stamp duty exemptions to the secondary market under Budget 2021, the progressive reduction of the overnight policy rate and the reduction in EPF contribution which he said is expected to provide opportunities for property seekers to explore subsale residential properties and ease home loan repayments which have sparked interest in property purchase among middle and upper-income households.