It’s an uphill struggle for the property market to stage a rebound this year. Chief Editor Jan Yong lists 8 reasons why.
Despite the many incentives by the government to stimulate the property market (see below) due to the pandemic’s negative effects, the downward pressures are too strong to see a rebound in prices this year.
1. Overriding political concerns with a general election expected at any time (probably November). Political uncertainty is not conducive to long-term plans nor inbound foreign investments.
2. Covid-19 pandemic is only expected to recover fully in 2021 or 2022, or maybe never just like AIDS where a vaccine has yet to be found. Globally, fear of a second or even third wave will slow down global demand and supply. Global commodity prices especially oil are projected to trend lower.
3. The six-month loan moratorium will end on 30 September except for individuals who have lost their jobs, on nopay leave or have had a salary cut. What happens to those who do not fall into these categories? As of June, there was an estimated 1 mil job losses. Expect more auctions coming due to many more desperate sellers as more companies retrench staff or close down.
4. Continuing oversupply / overhang that is not being adequately addressed.