Amidst the outbreak of the coronavirus or now known as Covid-19, stakeholders in the property industry turn to tech to keep interests alive.
Citizens of Wuhan in China's central Hubei province have been placed under quarantine along with 15 other cities as the outbreak worsened (Photo of Wuhan by Hector RETAMAL / AFP)
The novel coronavirus, now designated as Covid-19, can be seen affecting China’s already ailing property market.
According to the Wall Street Journal (WSJ), the growth of home prices in China is at the lowest level since July 2018 with a further decline expected.
Potential home buyers and tenants alike are either too fearful or unable to do the home viewings as sales of homes are postponed in areas as far the Guangxi province in southern China, as reported by the Financial Times (FT).
Effects felt across the globe including Malaysia
According to a report from Juwai.com and IQI Global, buyers from China accounted for RM8.4bil worth of property sales in Malaysia for 2018.
The South China Morning Post (SCMP) reported the USA and Thailand markets are staggering from the lack of interests from Chinese buyers as a result of the outbreak.
Malaysia is no exception. With the dependence on foreign buyers to help clear the property overhang, there is a cause for concern.
Malaysia Real Estate Promoting Association vice president Ronald Pua says that based on their research, it’s not just interest from foreign investors in China that are badly affected but investors from neighbouring countries as well.
Malaysian property developer Sheng Tai International has also seen interests from its large foreign investor base in Asia and Australia slow down slightly since the coronavirus outbreak.
“Some of them (investors) who have already registered for tours in February decided to postpone the date until further notice and we are still following up with them closely,” said Nicholas Leong, general manager of Sheng Tai.
"Nevertheless, some of our other markets are still maintaining its momentum, for example, the Japanese, who are still coming here in moderately large groups as planned. And as a responsible corporate citizen, Sheng Tai is putting in place all necessary measures to ensure our clients and staff's hygiene and safety at all times," added Leong.
Does the boon in real estate tech help ease the situation?
The recent decade has seen a wave of real estate tech such as Virtual Reality (VR) become mainstream as stakeholders seek to gain a competitive edge over industry rivals.
For example, prospective buyers can use VR to tour show houses from the comfort of their computer or mobile phones.
Sample of a Virtual Tour on StarProperty’s website. To view, click the link: https://www.starproperty.my/virtualhome
The question remains, however, does tech like virtual tours help mitigate the waning interests of foreign buyers?
With some customers unable or reluctant to leave their countries, Sheng Tai has shifted the emphasis to online marketing including creating live-streams of seminars, more virtual tours and use of social media platforms such as TikTok to promote Malaysia.
“..we need to promote Malaysia first for them (investors) to love Malaysia before buying a property here. Our (Sheng Tai) role is still property tourism, so technology and online selling play a major role”, mentioned Leong.
Others such as See Kok Loong, executive director of real-estate agency Metro Homes Realty Bhd, also attests to tech such as VR but believe further explanations by salespeople are needed to conclude the deal.
“Yes, it helps but for actual sales, it is still not that possible in Malaysia because it’s a big-ticket item and customers need to look at the details instead of the 360 images only,” said Loong.
Check out StarProperty's Starling Mall Digital Fair (24 Feb - 24 March 2020), a virtual property fair featuring exhibitors and properties offered during the physical fair at Starling Mall. Click here to view.
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