RHB Investment Bank said in a note today that ongoing market headwinds such as rising inflationary pressure and the weakening of the ringgit have continued to dampen the market sentiment.

“Coupled with the expectation of higher interest rates ahead, potential house buyers may defer their big-ticket item purchases over the next six months,” it said.

It said that although the incentive to drive demand has been reintroduced, costs remain a big concern for developers grappling with rising material costs and the labour shortage.

As a result, it said, earnings in the coming quarters for developers are likely to be affected. As such, it was maintaining a “neutral” rating on the property sector.

Last Friday, Prime Minister Ismail Sabri Yaakob launched the Home Ownership Programme (HOPE), which offers stamp duty exemptions for first-time house buyers on the instrument of transfer and loan agreement under the Keluarga Malaysia Home Ownership Initiative (i-Miliki).

The exemption is to be given to purchasers of properties priced up to RM500,000, while those who buy properties worth RM500,000 to RM1 million will be given a 50% discount.

These are applicable for properties for which the sale and purchase agreement is signed between June 1, 2022 and December 2023.

CGS-CIMB said the impact of the stamp duty exemption could be limited given the macro headwinds and less lucrative incentives compared to the Home Ownership Campaign (HOC). Under HOPE, there is no minimum 10% discount for residential properties.

“The i-Miliki incentives are applicable for first-time house buyers only, whereas the HOC has a wider coverage,” it said.

The research house said macro headwinds, such as increasing interest rates and inflation, could potentially dampen buying sentiment.

“It remains uncertain whether people will purchase big-ticket items during challenging times, despite incentives given, as property prices have more than doubled from 2009,” it added.