Open AccessASSESSMENT OF BUBBLES IN THE MALAYSIAN HOUSING MARKET
Author(s) -
Rohayu Ab Majid,
Rosli Said,
Chong J.T.S
Publication year - 2017
Publication title -
planning malaysia
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.232
H-Index - 7
eISSN - 1675-6215
pISSN - 0128-0945
DOI - 10.21837/pm.v15i3.295
Subject(s) - property market , business cycle , bubble , property (philosophy) , economic bubble , residential property , economics , housing industry , business , crash , finance , macroeconomics , real estate , engineering , economic geography , parallel computing , telecommunications , philosophy , epistemology , computer science , programming language
Property cycle and housing bubble have been a noteworthy subject of discussion since decades ago. The economic and business cycles have been closely associated with the property cycle as the economic and business factors have certain definite effects on the property market. At some point of the property cycle, the housing bubble will occur. The housing bubble is a trend of unreasonable increase of house prices where the increase is supported by factors that are not economics related. It causes the house prices to be intolerable in terms of housing affordability and the bursting of this housing bubble would lead to the crash of the property market. This paper focuses on using the economic indicators to identify the phases of the residential property cycle in Malaysia from the year 2000 to 2012. Having done so, housing bubbles were analysed using ratio analysis for the year 2012. The results show that housing bubble is yet to become a significant threat to our national property market as it only affects certain areas and housing types.