|
After a prolonged downturn following the Asian economic crisis, real estate markets across southern and eastern Asia are heating up again, with prices starting to climb rapidly in major cities and resorts throughout the region.
One of the market leaders to date, and the location with possibly the best growth potential for the future, is Malaysia, analysts say. The Malaysian market has undoubtedly been helped by steps to boost investment by the government, including the so-called Ninth Plan that runs from 2006 to 2010 and aims to improve infrastructure and boost economic development.
A recent relaxation of property laws to make it easier for foreigners to buy and the introduction of the ‘Malaysia, my second home program’ has also helped stimulate purchases. However, the real boom is probably yet to come.
Biggest work force incease in Asia
Malaysia is set to be the Asian country with the biggest increase in its work force through to 2013, with worker numbers increasing to 13 million – a staggering a 27.9% rise over a 10-year period.
More workers – coupled with high incomes (GDP is growing at close to 6 percent per year) – will undoubtedly drive domestic property buying, keeping prices and returns high for the foreseeable future.
Malaysia’s demographics, however, are only one of several forces driving the market. Increasing numbers of westerners are choosing Malaysia to buy vacation and second homes and still others are opting to retire there. The stability of the Malaysian government and economy, the country’s tropical climate and above all the low value of the Malaysian ringgit compared to the US dollar, euro and pound are key factors in boosting property purchases by Americans and Europeans. Interest from the Japanese, Indians, Chinese, Singaporeans and investors from the Middle East is also increasing.
Tourism has also played a role, with visitor numbers having reached 16.5 million in 2005 – a 160 percent increase on 2000.
According to official estimates, most areas of Malaysia have experienced a 15 to 30 percent increase in property values over the last five years, with analysts expecting that rate to quicken over the coming years. Rental yields, meanwhile, average about 8 percent in Kuala Lumpur and slightly less in tourist areas on the coast.
|
