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Domestic Property Market To Continue Resilience In 2024, Says JLL Malaysia Report

KUALA LUMPUR: The domestic real estate market is expected to see continued resilience in 2024, with certain segments demonstrating sustainable growth.

JLL Appraisal & Property Services Sdn Bhd head of research Yulia Nikulicheva said stakeholders’ primary focus continues to be on the three core segments with the highest growth potential – residential, logistics, industrial, and data centres.

According to JLL Global Capital Outlook 2024, this positive trend is expected to be fueled by several key factors, namely stable macroeconomic growth partly attributed to multinational companies’ wider adoption of the ‘China Plus One’ strategy.

By diversifying their operations beyond mainland China, these companies are expected to drive increased business activity in Malaysia’s office, logistics, and industrial sectors, contributing to overall economic growth.

Secondly, real estate growth is also due to the financial markets anticipated to demonstrate stability, fostering optimism among investors.

This stable environment is expected to encourage continued investment in the real estate sector.

Furthermore, strong domestic demand is expected to play a significant role in bolstering the market.

This robust demand will support growth across various segments, ensuring a well-rounded market performance.

Further, the continued development of technology and the implementation of relevant measures are expected to enhance and innovate the real estate industry.

These advancements can streamline processes, improve transparency, and open up new opportunities for buyers and sellers.

Overall, the report said 2024 appears to hold promise for the Malaysian real estate market.

Supported by stable macroeconomic growth, financial market stability, strong domestic demand, and technological advancements, the market is well-positioned for continued resilience and sustainable growth.

“We have observed that investors are displaying a more positive outlook towards the Malaysian real estate market,
driven by the favourable dynamics and robust recovery witnessed over the past six quarters.

“However, their primary focus continues to be on the three core segments with the highest growth potential – residential, logistics and industrial, and data centres,” JLL Appraisal & Property Services Sdn Bhd head of research Yulia Nikulicheva said in a statement.

On risks, the JLL Malaysia report said one potential concern is the escalation of local conflicts worldwide.

This could ripple effect, leading to rising global inflation and further disruptions to global supply chains.

Both of these factors could dampen the positive outlook for the real estate market.

Another potential roadblock is a slowdown in the Chinese economy.

The report said that as China is a major player in the global market, a significant slowdown in its growth could have implications for various industries, including real estate, potentially impacting Malaysia as well.

Finally, slower growth in key global markets, such as Western Europe (particularly Germany) and the United States, could also significantly impact the dynamics of the Malaysian market.

This is because Malaysia heavily relies on exports of manufactured goods to these economies, and their performance directly influences future market conditions.

While these risks cannot be ignored, it is important to remember the underlying strengths of the Malaysian real estate market.

By acknowledging these potential challenges and proactively developing strategies to mitigate them, stakeholders can ensure the market continues its trajectory of resilience and sustainable growth in the coming year, the JLL report noted.

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