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Saturday, July 9, 2011

Yeah: Property market has strong support

PUTRAJAYA: The moderately strong performance of the Malaysian economy, together with favourable demographics, income and employment growth, urbanisation and accommodative financing conditions will support continuing growth of the property market.

RAM Holdings Bhd group chief economist Dr Yeah Kim Leng said Malaysia’s demographic structure was still a relatively young population, with a very low age dependency ratio and also high levels of rural-urban migration.

“Apart from that, as property becomes an important assets class with the rise in the household income, demand for properties especially the high-end will also continue to grow,” he said yesterday at the Malaysian Property Outlook 2011 conference.

Several large property-related Entry Point Projects (EPP) together with the new focus on affordable housing for first time buyers would boost the property market,” he said. “Construction sector, including infrastructure and property sector covering both residential and commercial properties are among the key beneficiaries of the ETP.”

Yeah said the total value of residential and commercial property stocks in the country was projected to increase at 8% to 10% annually over the present decade (2011-2020) from an average of 5.9% per annum achieved in 2001-2009 period.

The supply of credit to the property market had also shown steady growth, as the banking sector was less hesitant in giving out residential property loans, he said, adding: “Banking sector loans achieved high rates of approval despite higher interest rates. This is an indicative of pent-up demand for residential properties.”

However, Yeah said uncertainties over the next general election, the delayed of ETP implementation and inflation risks might somehow derail the growth of the property market.

The conference was jointly organised by property developer Encorp Bhd and Malaysia University of Science and Technology.

It was aim at providing an outlook on the economy and property market, as well as insights on current issues and developments within the property sector.

By The Star

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