4 Things Real Estate Investors Can Expect in 2016

by - April 28, 2016

One of the most lucrative investments to make a few years ago was in real estate when the bubble was still fully intact, but as everyone knows, it burst eventually. However, as the economy and the property industry it self continues to recover, prospectors are once again looking to market for potential investment opportunities. The overview of 2016 for real estate is that the market is still evening out and regulating itself. The GDP will show a little less growth than in 2015, but unlike an economic crisis, it’s not fluctuating wildly. Keeping the market steady is important, and as 2017 creeps up, it’s more essential than ever to continue to monitor trends. Here are four things that investors can expect in the Malaysian real estate market for the rest of the year.



1. What Was Expected, and What to Expect

To summarize the Malaysia property market, PropertyGuru Malaysia simplifies matters by stating that the national economy is slated to slow down in 2016. However, that also doesn’t mean that the market is about to crash. The growth of the GDP will grow by a predicted four to five percent this year, as opposed to a solid five percent in 2015. This isn’t an indicator of a downward spiral, but rather, a slow recovery. However, although this is good news in the long run, that doesn’t mean that it’s the perfect time to invest. Generally speaking, there are a lot of pros and cons when it comes to real estate investment at all times, no matter what the economy is doing. However, the reasoning behind purchasing real estate for investors versus would-be homeowners is very different. While the market isn’t bad for people who are looking to purchase property they intend to reside in, investors should be more wary.

2. Property Market Trends and Predictions

According to the Malay Mail Online, experts predicted earlier this year that for 2016, the first half would see real estate transactions total at RM35 billion, as compared to RM36.38 billion in the first half of the previous year. In other words, the market will not fluctuate wildly, nor will it crash. Although seeing profits skyrocket is always desirable, in the long-term, it’s actually best for investors to allow the market to stabilize and develop again, rather than forging forward without recognizing the trends. Right now, the market is not prime for investors, but it’s not continuing to spiral downward. The state of other economies as well, such as China and Singapore, will also directly impact how real estate fares in the second half of 2016.

3. The Current State of the Real Estate Sector

The Star Online points out that although investors might be willing to pay high prices for choice real estate, there’s no guarantee that rental prices will then match the amount. This is another way of saying that if you’re hoping to break even with only a small margin of error allowed, it’s not the right time to invest. Buyers with more leeway to absorb losses and who can afford to fail, but want to try nonetheless, are the only major real estate investors in the current market. Any smart investor will wait until market prices match what rental incomes can be, and then go from there. If you’re an investor with a solid but humble financial portfolio, now is not the right time to purchase property. Watch the market as it recovers, and wait for demand to also meet supply. In order to adjust due to the Malaysian real estate bubble pop a few years ago, many developers halted building new units until the residential housing market was ready to pick back up. As such, if you’re being financially conservative, then don’t jump in when the market is still cloudy and in recovery.

4. Continued Power of Online Search Portals

As is to be expected, the power of the Internet continues to be a force to be reckoned with even outside price trends and market values. Sites that allow investors to search properties and compare prices at the click of a button empower buyers and brokers alike, presenting a snapshot day by day of what the real estate market is actually doing. Keeping in tune with these tools is especially important to investors monitoring the mood of the market, including both buyers and renters.

Overall, real estate can be a risky business if you jump in headfirst without a plan. Many investors just a few years ago were rash, completely absorbed into the fantasy world of when real estate was at its peak and garnering huge profits. However, that all ended after the worldwide economic recession and the backlash of the Malaysian real estate bubble popping. The best advice investors can take in 2016 and going into next year is that sure and steady is the best advice possible. Keep your eye on exactly what you want your investment to bring you and for a time when the market is up. That’s the time to invest.


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6 Comments

  1. Jom beli "bumi" ... hi hi hi... banyak iklan "Earth for sale" kat sini... hi hi hi

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  2. Replies
    1. Sila-sila.. tapi jangan juling sudah tau..hehhee :D

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  3. Replies
    1. hamboiii bulan.. nasih baik bukan planet lain.. keh keh keh .. terus jadu angkasawan.. :p

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