Entering Second Half of 2021 with Greater Optimism?
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TECHONOLOGY, FINALLY RIPE FOR THE PICKING PLUS Market Comeback Interrupted by Rising Cases & MCOs. pg 6 Cheras North. pg 8 Benefits of Performing Business Valuation. pg 10 Will Writing 101. pg 12 JULY - SEPTEMBER 2021 Entering Second Half of 2021 With Greater Optimism? had to close their shutters with their staff real estate agents and negotiators required to work from home. whose source of income is from commissions earned from closing deals, To make matters worse, when the this is a very depressing state of affairs number of Covid-19 positive cases and those without sufficient reserves to continued to shoot up, the government tide them through this difficult period, implemented firstly MCO 3.0 and then have turned to other avenues to put a full lockdown under a Full Movement rice on their tables for their families eg. Control Order (FMCO) from 1 to 14 home based food catering businesses, June which was later extended to food deliveries and working as e-hailing 28 June. Worse is to come as the drivers or taking up a full or part time government has just announced an job in other industries for those lucky Enhanced Movement Control Order enough to find alternative employment (EMCO) for 14 localities in Kuala Lumpur under current trying times. and 34 mukims in Selangor under which Tang Chee Meng even stricter control over movement of What does the rest of the year hold for residents and operation of businesses all of us? e have now entered the will be enforced. second half of 2021. The The property industry, like the stock first half of the year has been All these lockdown restrictions had a market, requires a number of key Wanything but uneventful. First, the Prime significant impact on all businesses and ingredients to be in place for it to Minister Tan Sri Muhyiddin Yassin sought in particular, hit the retail trade as well boom and flourish. Firstly, the country and secured the the Yang di-Pertuan as those involved in the tourism and should be recording positive economic Agong Al-Sultan Abdullah Ri’aya tuddin hospitality industries badly. For those of growth as this will put more money Al-Mustafa Billah Shah’s approval to us in the property services sector, only into the pockets of everyone which declare a state of emergency for the staff involved in property management will then find its way into the property whole country effective from 11 January were allowed to operate as usual but with market, amongst other things. It is also 2021 to 1 August 2021. Under the rules of strict SOPs. Those dealing in real estate important for investors’ sentiments not the emergency, various restrictions were agency and project marketing were the to be negatively affected by adverse placed on movement of people not only most badly affected as these were not developments in not only the economic from one state to another but also from considered as essential services. There sphere but also the country’s political one district to the next. Parliament was was at least one case being circulated on situation. The speed at which the suspended and only companies offering social media, though not independently country reaches herd immunity in its essential goods and services which were verified, of a real estate agent being fight against the Covid-19 pandemic listed by the Ministry of International fined together with his clients for being is also crucial in restoring normalcy in Trade and Industry were allowed to open caught conducting a property viewing the daily lives of the people so that for business whilst those which were not, and the fines were not small sums. For businesses can recover and grow, and KDN PP18893/11/2015(034373) for the investors to return to the equity On the economic front, the Finance together and take the right steps to and property markets. So where are we Minister Tengku Datuk Seri Zafrul Abdul lead us out of this dark and harrowing in all these areas? Aziz has indicated that his ministry is period in our history. Although the studying whether the GDP growth rate government has unveiled another In the political arena, the current for 2021 as projected in his budget RM150 billion aid package called administration appears to be more speech last November needs to be Pemulih to assist businesses as well as unstable compared to a year ago. revised. 2020 saw the country registering the B40 and M40 groups, the decision The surge in Covid-19 infections a negative growth of 5.6% which was of the government to put Kuala Lumpur despite the proclamation of a state of the second worst decline after the 7.5% and Selangor, where the country’s emergency as well as the constant flip negative growth in 1998 brought about economic engines are located, under flops in government announcements by the Asian Financial Crisis. The general an EMCO will have a drastic impact on on the SOPs plus the perceived uneven consensus is that the business slowdown the economy, especially if the lockdown treatment of VIPs and celebrities caused by the declaration of emergency is extended for too long and will lead compared to normal folks have led and the introduction of FMCO will to increased business closures, pay to a feeling that the government is certainly have a negative impact on cuts and retrenchments, and ultimately unable to handle the pandemic and economic growth and will bring down impact investor’s confidence. With have given rise to frustration as well as GDP growth from the earlier projection this in mind, our house view is that anger against those in power. of between 6 to 7.5%. This may in turn the property market will not show any translate to a slower recovery of the dramatic recovery for the remaining In a recent development, the Yang property market. months of the year and at best, growth di-Pertuan Agong has met with the will be flattish. If the government is leaders of all the major political parties The most positive development is the able to achieve its targets set under to discuss the situation and has then recent ramping up of vaccination rates the NRP, we may see a more marked met with his brother rulers to seek from the under 100,000 shots given improvement in the market in 2022. their views on the current state of out per day before June 2021 to above affairs. The Palace as well as the rulers 250,000 vaccinations a day currently. In Let us pray and hope that we will be have issued statements suggesting fact, the government has confidently able to celebrate our New Year, Chinese that Parliament be reconvened as projected that the vaccination rates New Year, Hari Raya, Deepavali and soon as possible although this quickly would go above 400,000 shots a day Christmas in 2022, the way we have became a point of debate between the in August in order to achieve 80% herd always been doing before the pandemic opposition and government leaders as immunity by September. came and disrupted our lives. to how soon is “as soon as possible”. The royal statements also mentioned As at 24 June 2021, a total of 6.3 million To all our readers, stay safe and stay that there would not be any need for doses were reported to have been given healthy and please remember to the emergency to be extended beyond out to 1.73 million people or covering observe the SOPs at all times. its current 1 August 2021 end date. about 5.4% of the population. Achieving herd immunity is the key to returning to On the day before the meeting of the a state of normalcy and recovery of the Tang Chee Meng rulers, the Prime Minister came up with economy; the sooner we achieve it, the Chief Operating Officer a post pandemic exit plan (NRP) which less financial pain and emotional stress set various targets for the four phases suffered by businesses and the rakyat. Footnote: of the plan to map out its recovery Since the writing of this Editor’s Note: path out of the pandemic. Although For the property market, there a) The government has announced short on details and panned by the was some good news for property that Dewan Rakyat proceedings will opposition, the plan is at least a step developers in that the Home Ownership take place from 26 to 29 July and 2 forward in the country’s journey out Campaign (HOC) which was due to end August whilst the Senate will sit for of the economic quagmire brought in June 2021 has now been extended to three days from 3 to 5 August. about by the pandemic. Nevertheless, December 2021. Some equity analysts b) The Minister of Finance has also the royal call to reconvene parliament have predicted the property market to indicated that GDP growth for 2021 asap has taken another dimension as stage a gradual recovery in the second will likely be closer to 4%. the opposition could well use this as half of the year due to the current low c) As of 12 July 2021, the country has a way to bring down the government interest regime, wider availability of administered more than 400,000 which it claims has lost its majority and affordably priced products and reduced daily doses of the Covid-19 therefore the legitimacy to continue to pricing which may encourage people to vaccination. rule. The months ahead would certainly take the opportunity to own a home.