Tag Archives: General Election

General Election Pose Risk to Property Sector?

malaysia property

Although there is no property bubble, the recent hike in real property gains tax (RPGT) causes the consumer remain caution of rising housing prices. Such policy could put a pause to home purchasers who may anticipate further measures which would improve the affordability. This in turn could hurt the developers’ new sales of property.

However, any drop in demand would be temporary until the general election is over, and the general election results could bring major impact on people confidence and demand.

malaysia house prices by state

There could be stock market volatility just before and after election as was in the 2008 election, which could affect home purchaser’s decision making. There could be higher possibilities that many purchasers will stay on the sidelines for election to be over before making any purchases. Thus, this would likely hurt the property demand in the 1st half of the year.

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Will General Election Affect Bursa?

Most of us still can remember the year 1997 economy crisis which hit whole Asian countries. Those countries that major affected are South Korea, Malaysia, Indonesia, Hong Kong, Laos and Philippines. At that time, we can see that all these countries currencies dropped to a lower level against the US dollars.

Kuala Lumpur Composite Index KLCI

During that year, the economies of Southeast Asia were the main attraction for foreign investors due to its high interest rate. We observed that the hot money pumped into these regions various sector such as properties, stocks and so on. The growth domestic product rate was 8 – 10 % for these countries.

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