MALAYMAIL. 8TH MAY: Global real estate technology group Juwai IQI believes the housing market will remain robust with moderate price increases and demand continuing to grow despite the rise in the Overnight Policy Rate (OPR) by Bank Negara Malaysia (BNM) recently.
Global real estate technology group Juwai IQI believes the housing market will remain robust with moderate price increases and demand continuing to grow despite the rise in the Overnight Policy Rate (OPR) by Bank Negara Malaysia (BNM) recently.
Co-founder and group chief executive officer Kashif Ansari said in a statement today that housing market indicators have been positive over the past three quarters with rising transaction volume and declining overhang.
“We are confident this positive trend will continue in the second quarter. Although the higher rates make purchasing and developing housing more expensive, we believe the real estate market can absorb this increase.
For buyers, the higher mortgage is offset by improved household financial circumstances among many families, he said in a statement.
The OPR rise would increase borrowing cost for developers.
“We could see a moderating in the number of projects being planned and those starting construction over the next six months.
“In 2022, construction started on 98,000 landed and high-rise residential units. By the end of the year, just over 89,000 units were in the pipeline for future construction,” said Kashif.
He also said that BNM is determined to rein in inflation and ease the economy into a soft landing, balancing growth and inflation.
“Growth prospects are resilient, even with this latest rate rise, and growth will support the housing market,” he said.
On May 3, 2023, BNM raised the OPR by 25 bps to 3.00 per cent.
The need to raise rates again underscores the fundamental strength of the Malaysian economy in 2023.
“It is much better to have a strong economy and the need to raise rates to keep it from overheating than to have a sputtering economy that needs policy stimulus,” Kashif added.