Oversupply causes of double storey terrace houses in Johor Bahru

Abstract

Malaysia is currently facing an increasing problem in housing oversupply with Johor holding the second largest share in the nation’s oversupply stocks. Thus, this paper investigates the factors affecting housing oversupply in Johor, focusing on double terrace houses in Johor Bahru. The first objective reviews the causes of housing oversupply. The second objective evaluates the level of influence of factors on double storey terrace house oversupply in Johor Bahru. Questionnaires are distributed to 21 real estate agents in Johor Bahru to obtain their views on the housing oversupply factors. The level of influence of housing oversupply factors are ranked based on mean score. The study observes that housing unaffordability caused by expensive house prices and tight lending conditions strongly influence the housing oversupply in Johor Bahru. Thus, all parties in the property sector must work together to improve the buyers’ housing affordability to reduce housing oversupply in Johor Bahru. The findings of the study guides the developers, planners, policy makers and financial institutions in making property planning and financing decisions. Future research may attempt to investigate factors influencing the oversupply of other housing types or extend the study area to allow further understanding on housing oversupply problems in Malaysia.