Yuan's devaluation to impact on the Johor property market
KGV International Property Consultants (M) Sdn Bhd director Samuel Tan Wee Cheng said that, it is still ‘too early’ to gauge the effect of yuan devaluation on the property market of Johor, reported The Star.
“The top range of well-heeled Chinese buyers tend to buy in the United States, Hong Kong and in the countries with more stable currencies. Malaysia and other South-East Asian destinations will attract the less wealthy of the lot,” said Tan.
He noted that the decline in the number of Chinese buyers will be mitigated by the entry of buyers from Singapore as the Singapore dollar has strengthened against the ringgit.
With the cheaper ringgit, properties in Johor will be more appealing for lower range Chinese buyers and Singapore buyers. In fact, these buyers may even go for a
landed property, instead of a high-rise unit since it appears to be a better proposition.
“People buy properties based on hope and future. Foreign exchange gain is another factor,” said Tan.
Hong Kong-based Credit Suisse property analyst Du Jin Song said the Chinese have been buying properties abroad during the past several years. If the current devaluation in the yuan is just ‘the beginning’, he expects many to buy properties overseas.
“The Chinese may buy in Hong Kong, the United States or in countries whose currencies are strengthening,” he further adds.
Meanwhile, Landserve (Johor) Sdn Bhd executive director Wee Soon Chit said buyers from Singapore have a higher probability of purchasing a property in Johor than Chinese buyers, but it is still early days.