KUCHING: Sarawak Housing and Real Estate Developers’ Association (Sheda) Kuching Branch chairman Sim Kiang Chiok opines that Sarawak is facing a brighter economic outlook in the next half year.
According to Sim, the World Bank has forecasted Sarawak’s economic growth at 4.7per cent for 2019 and 4.6 per cent for 2020 and that Malaysia will be a high-income nation by 2024.
“Since the change in May 2018, the Pakatan Harapan federal government is still struggling to keep up to the promises in its manifesto and has not injected much confidence into the market with its many non-positive or even contradictory statements on the debt level.
“Its direction on the economic policy and target have not been able to attract many foreign investors, the share market is weak and so is our Ringgit.
“However, Sarawak outlook is better with a forecasted GDP growth of 5 per cent for 2019. This is attributed to the huge expansionary state budget of RM11. 1 billion with RM9 billion for development of infrastructure, digital economy, logistics and the ongoing Pan Borneo Highway which is funded by federal government.
“This will create job opportunities and spinoffs which will drive the economic growth of the state,” he said in a press statement yesterday.
Sim said the housing market was slow in the first half of 2019 due to difficulties in raising end-financing by purchasers over the last three years and strict lending guidelines based on proven income method instead of collateral-based lending.
“I foresee that this condition will still be enforced until the price escalation of properties slows down to a manageable level while not affecting the increase in overhang properties and new properties can continue to be launched,” he said.
He noted that Bank Negara had cut interest rates from 3.25 per cent to 3 per cent which was a sure indicator that the economy was slowing down. Hence, there was a need to lower the interest rates to encourage more economic activities at a lower cost.
“This is good for all house owners with housing loans as the repayment will be lowered, new purchasers can afford higher priced houses or enjoy lower repayments. This is good for developers as it is easier to sell their houses and reduce their capital cost.
“Housing is a basic need of all humans and there will always be demand for houses when the population is growing with good jobs, banks are supportive of lending.
“Developers will build when the market and economic conditions are right. I foresee Sarawak’s economy for the second half of 2019 will be better than the first half.”
