KUALA LUMPUR, Jan 26 — More people are seeking houses in outskirt areas, lowering demand and residential property prices in the cities, according to iProperty.com.my.

Its spokesperson and REA Group Asia general manager (Customer Data Solutions) Premendran Pathmanathan citing the property portal’s 2020 Property Demand Analytics said Shah Alam and Seremban recorded positive demand of +1.7 per cent and +0.9 per cent, respectively.

On the other hand, iProperty found that housing demand in Kuala Lumpur City Centre contracted by -8.9 per cent with -11 per cent capital growth decline; similarly, demand in Georgetown contracted by -11.9 per cent with -8.7 per cent capital growth decline.

“The trend of moving outskirts is mainly because of the reduction in commuting as people are working from home and they want to look for bigger and more comfortable houses.

“Among areas that are also gaining traction are Kepala Batas in Penang, Muar in Johor, and Puncak Alam in Selangor,” Premendran said in his virtual presentation on iProperty’s analytics today.

The report noted that the national demand for subsale property in 2020 fell by -1.3 per cent year-on-year (YoY). The demand for high-rise properties is down in line with prices while the demand for terrace houses remained positive at a capital growth of +2.6 per cent.

As of December 2020, Premendran said unique visits to iProperty’s portal for subsale property listings saw an upward recovery of 85 per cent since the imposition of the movement control order (MCO) in March 2020.

He said positive direction has also been observed for home loans applied, where the surge in user visits to iProperty.com.my is aligned with the increase in value of home loans applied by Malaysian consumers in November 2020, based on official national data.

“However, as people are also facing challenges in pay cuts and losing their jobs, interest in properties within the lower priced property range listings has dropped, hence there was also a drop in visits in the portal.

“On the other hand, we hope the initiatives provided by the government in Budget 2021 including  reducing some upfront costs would be able to help especially first time buyers to have more disposable income and increase their chance of getting loans approved,” he said.

He mentioned the upfront costs as exemptions of stamp duty and waivers on legal fees, reduction in Employees Provident Fund (EPF) contribution and the progressive reduction of the Overnight Policy Rate (OPR) to 1.75 per cent,

Moving forward, he said the subsale property demand is expected to remain challenging in the first half  2021 due to the surge in Covid-19 cases, and MCO 2.0 which limits people’s movement.

“As economy is highly connected to mobility, people may not be able to look for houses and this will likely soften the property market.

“Rules such as limiting visits by (potential home buyers) to apartments and condominiums are also contributing to this factor,” he said.

Nevertheless, he said iProperty believes that the property market will recover after the much anticipated roll out of the Covid vaccine programme which could help to boost the economy. — Bernama