Property Slump Hit Asia Hard and Fast, Recovery may do Same

Sales of Asian property fell by an average of 70% in the 4th quarter of 2008, reports Asia Property Report. In the article, published Feb 26, Khalil Adis writes:

"Gateway cities experienced the greatest drop in real estate transactional activity in the fourth quarter of 2008 with Singapore experiencing a decline of 96 percent compared to the same period in 2007, DTZ latest report shows.

"Similarly, gateway cities like Hong Kong, Beijing and Shanghai also experienced a decline with just one deal each that was over US$10 million during the same quarter.

"Meanwhile, Asia's biggest real estate market, Japan, saw a 50 percent decline in the number of deals and an 84 percent drop in the value of transactions."

Asia was one of the hottest regions during the boom; such a massive drop in sales shows just how quickly the credit crunch took hold in the region, with sales having been strong in the first three quarters.

The slump being so fast and so great however gives way to hope that the recovery may be equally as quick.

The Malaysian Tourism Ministry has reported that it expects 20million foreign and domestic tourists in 2009, a fall of only 2million on last year, and a series of initiatives aimed at hitting this target.

Malaysia's Kuala Lumpur was one of the great Asian emerging markets, and its emergence, like the emergence of other parts of Malaysia, including the coastal areas of Sabah, was primarily fuelled by tourism. If high levels of tourism can indeed be achieved in 2009, it will help any green shoots of recovery that may shoot in 2009 to flourish.