Currently, it is harder to buy a new property due to tightening loan regulation. Even commercial property sales are affected. This foresight and actions taken by Bank Negara should be applaused because the steps help to stabilize property market especially in Johor Bahru.
The hardest property segment being hit especially in Johor Bahru is high rise building such as service apartment. I got a new pamphlet from a developer, originally the smallest unit was launched at RM480,000, two years later the same unit was sold for RM380,000, now the same unit is sell for RM320,000. I don't bother to pay any visit to the showroom. So I do not know how this new price will affect the monthly maintenance fee. But the funny thing is there are still a lot of new development of service apartment in Johor Bahru. Those new developments may be already under planning and received approval for development before the property market is confirmed on the downside.
It is still okey if you buy the apartment for your own stay but it is not good strategy for rental. This also means it is buyers market now in Johor Bahru. However, property price for landed property segment is still strong in Johor Bahru. Even though developers have difficulty to sell some of their units, those who already bought the property should be happy about it. The scenario help to stabilized the rental market. The population growth in Johor Bahru is getting stronger. A few years ago, traffic jam only happened during time to go to work or back from work. Now, it is a bad timing if you try to go to Johor Bahru on Saturday. Some major roads are always under traffic jam on Saturday.
The good news is economy activities in Johor Bahru is still strong. In fact, there are a few more new investment in Johor Bahru which can offer high salary for those who qualify. This definitely can offset the slowing down in oil and gas sector. Oh I forgot, this sector is still small in Johor Bahru which focused in Pengerang, Kota Tinggi. Most of contractors who got the benefits are from Klang valley. In addition, Oil and Gas sector does not employ as many people as in manufacturing sector.
Some manufacturers who depend on old products and technology cannot sustain in Malaysia especially with the raising cost of manpower.If they fail to automate their process and reduce manpower, the operational cost cannot be sustained in the long run. Hence, a few companies already shutting down their operation in Johor Bahru. But, new manufacturers in Johor Bahru are value added manufacturers and use a lot of process automation. Thus, minimum salary requirement is not a problem for these new manufacturers. In fact, a few more companies are in discussion to invest more than RM1 billion each of them in Johor Bahru.
If this scenario can be sustained, job market in Johor Bahru will continuously be stabilized and improved. Hence, the property market can also be maintained. Since developers have to slow down in their property development in Johor Bahru while job market is sustainable, this also mean property rental market is also sustainable.
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