RHB IB confidently foresees a robust surge in property sales momentum from 2023-2024. This exceptional progress will be propelled by the remarkable impact of infrastructure projects, the stability of interest rates, and the potential review of the MM2H program.
Kuala Lumpur, July 17 – RHB Investment Bank research maintains a positive outlook on the property sector, projecting robust sales momentum for the next two years. With positive news flow and a stable interest rate outlook, the market sentiment is expected to improve. Notably, the potential review of the Malaysia My Second Home (MM2H) program is seen as crucial for the sector’s recovery.
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Sustained Growth in Property Sales
RHB Investment Bank research remains optimistic about the property sector, predicting strong sales momentum in 2023 and 2024. The market is poised for growth, driven by favorable factors such as the revival of major infrastructure projects, potential catalytic developments, and a stable interest rate outlook. This positive sentiment is expected to uplift the overall property market.
Johor Property Market: A Sustainable Recovery
In its latest sector update, RHB IB highlights the sustained recovery of the Johor property market. The region has shown signs of a steady rebound, fueled by various factors contributing to its growth potential. These factors include proposed initiatives such as the Johor-Singapore special economic zone and the potential revival of the KL-Singapore high-speed rail project. The positive momentum in the property sector has already been witnessed since early July.
Identifying Top Picks: UEM Sunrise, IOI Properties, Matrix Concepts
RHB IB has identified UEM Sunrise Bhd (UEMS), IOI Properties Group Bhd (IOIPG), and Matrix Concepts Holdings Bhd (MCH) as top picks within the property sector. These companies have displayed strong potential for growth and profitability, making them attractive investment options. Investors are advised to consider these key players when looking for opportunities within the property market.
The Crucial Role of MM2H Program Review
A crucial aspect of the property market’s recovery lies in the potential review of the Malaysia My Second Home (MM2H) program. RHB IB emphasizes the significance of this review in boosting market sentiment and stimulating demand. The MM2H program has historically attracted foreign buyers, contributing to the growth of the property sector. Any favorable updates or modifications to the program can provide a much-needed impetus to further drive the recovery and expansion of the market.
Currency Depreciation Spurs Foreign Spending
The sharp depreciation of the ringgit during the second quarter impacted equity market sentiment. However, this has resulted in a positive outcome for the property market. The weakened currency has encouraged spending by foreign visitors, particularly those from neighboring Singapore. RHB IB’s recent visit to Johor revealed a notable increase in visitors from Singapore, not just on weekends but also starting from Fridays. The completion of the Johor Bahru-Singapore Rapid Transit System in 2026 is anticipated to amplify this trend, resulting in increased visitor traffic and subsequent positive effects on the property market.
Stable Interest Rate Outlook
Looking ahead, the interest rate outlook appears stable, bringing a sense of certainty for homebuyers and property investors. The market expects either no further rate increases or at most one more interest rate hike in the second half of the year. The normalization of interest rates is a positive development, reinstating confidence in the market. Mortgage rates currently stand at approximately 4.5% to 4.7%, aligning with pre-pandemic levels.