What is it about?
This paper aims to examine the determinants of house prices in Malaysia, including those such as income, population, foreign inflow and speculation. Our findings showed that the rapidly increasing house price is not caused by speculation activities in the housing market. More precisely, Malaysian income is capable of catching up with the increasing house prices.
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Why is it important?
Many studies in Malaysia have ignored the effect of foreign inflow on the Malaysian housing price. This study utilised state level foreign purchase data on housing, obtained from the Valuation and Property Services Department, Malaysia (JPPH), to represent foreign inflow. Therefore, the results will reflect regional foreign inflow better.
Perspectives
Financial innovation in financial system now regards houses as a financial asset and speculation vehicle. Therefore, a house purchase is made not merely to acquire a necessity but also to acquire a financial asset which can generate future returns.
Dr Lee Chin
University Putra Malaysia
Read the Original
This page is a summary of: Housing prices in peninsular Malaysia: supported by income, foreign inflow or speculation?, International Journal of Housing Markets and Analysis, June 2019, Emerald,
DOI: 10.1108/ijhma-01-2018-0001.
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