Evolving Property Buying Behaviors Dr Gerard Kho Futurist
Evolving Property Buying Behaviors Dr Gerard Kho, Futurist, Dehinc. Asia National Real Estate Convention Company Proprietary and Confidential
Food for Thought… § What are the purchasing behaviors today? § What drives buyer behaviors? § What to watch out for in anticipating the changes in changing consumer patterns? § How do we more effectively reach & influence these buyers?
Where Data Comes From Central Agencies UNITED NATIONS
7 -step Purchasing Process in MY Source: Property. Guru, Research data of Google research 2013.
63% are Investors & 1 st Time Buyers Source: IPSOS 2013 & 2014 Base: 630 Malaysian property seekers
Understanding the Drivers that Could Impact Buying Process • • • • Population growth Migration patterns Urbanization Labour workforce participation Personal income Fertility rates Household sizes Life expectancy Literacy Communications Investment into Communications Productivity Energy Transport Infrastructure R&D Investments
Today’s Buyer Behavior: Price & Location Key Concern NOT Size or Type of Property Source: Property. Guru & Research data of Google research 2013.
Price: Decreasing Savings Level Since 2008…. . Savings is now less than 30% of GDP dropping after 2008 and has not recovered since then Savings as a percentage of GDP (%) Source: World Bank
Household Consumption Rising Since 2008… Consumption has escalated steadily since 2008 primarily due to housing costs increased post 2008 Household Final Consumption Expenditure (% of GDP) Source: World Bank
Consumption is Anticipated to Increase with GST? GST will lead on to increased costs of properties and general consumption Source: International Futures
Good News: Everyone’s Income Is Set to Rise Good news is that income is anticipated to increase in an accelerated manner Source: International Futures
Excess Savings Should Still Be Increasing? Does this mean that savings could be negatively impacted because of increased burden from GST? Source: International Futures
Location: Population + Urbanisation Growth +160 m SEA people in 40 years… +22 m SEA urbanites in 40 years… Population (millions) 1980 2010 2050 Urbanisation (%) 1975 2000 2050 SE Asia 359 593 759 SE Asia 23. 3 38. 2 65. 4 Cambodia 6. 5 14. 1 19 Cambodia 4. 4 16. 9 43. 8 Indonesia 150. 8 239. 9 293. 5 Indonesia 19. 3 42 65. 9 Malaysia 13. 8 28. 4 43. 5 Malaysia 37. 7 62 87. 9 Myanmar 32. 9 48 55. 3 Myanmar 23. 9 27. 8 62. 9 Philippines 47. 1 93. 3 154. 9 Philippines 35. 6 48 69. 4 Singapore 2. 4 5. 1 6. 1 Singapore 100 100 Thailand 47. 5 69. 1 71 Thailand 23. 8 31. 1 60 Vietnam 54 87. 8 104 Viet. Nam 14. 6 24. 3 54. 9 Source: United Nations, World Population Prospects
2015 – 2020: 3 m Moving to Urban Areas Good news is 3 m people anticipated to move to urban centres (same as what’s happened in the previous 5 years) Source: International Futures
But Urbanization to Reach Saturation Point in 15 yrs However, the urbanization would start to slow down in about a decade, could this impact demand? Source: International Futures
Moving is No Big Drama, so could Open Up New Urban Centres
Mobility Could Fuel Migration and Extension of Boundaries of Cities………. Source: International Futures
Today’s Buyer Behavior: Size or Type of Property NOT a Major Concern Source: Property. Guru & Research data of Google research 2013.
Property Size: Population Will Increase But at Slower Pace However, because of the slower rate of population increase compared to previous decade could mean demand for properties could be impacted Source: International Futures
And Population Growth will Hit a Plateau by 2050 Impact of slowing population will be felt even earlier – in next 20 years time Source: International Futures
Birth Rates Drops but Stabilises fr 2040 onwards More people choose to have less children Source: International Futures
Less Infants in Absolute Numbers Source: International Futures
Does the Future Buyers Really Want/Afford More Space/ What Would this Mean for Future Demand?
Good news: Labour Force Continue Growing so Purchasing Capacity Could Still Grow Size of work force increase until 2045 and then starts to dwindle Source: International Futures
Good News: 1. 2 m Joining Workforce in Next 5 years Last 5 years, 1. 2 m joined the workforce (the same growth as last 5 yrs). Demand thus should remain strong. Females contribute 3% every decade last 2 decades. Source: International Futures
Female Participation in Workforce Biggest Growth, so Would Women Affect the Types of Properties Demanded Source: International Futures
Reaching/Influencing the Buyers: Malaysians Allocate 23 months to Search & View Source: Property. Guru & Research data of Google research 2013.
Online Is Primary Source For Property 97% www. 78% uses Property Portal as key source of information of property seekers search for property online In Singapore: In Thailand: In Indonesia: 95% of property seekers search 97% of property seekers 95% of property seekers search for property online; 72% uses Property Portal as 62% uses Property Portal as 74% uses Property Portal as key source of information Source: IPSOS
Global Online Landscape
Internet Penetration Growing Rapidly 80 70 Percentage (%) 60 Singapore Malaysia 50 Thailand 40 Indonesia 30 20 10 0 2005 Source: World Bank 2006 2007 2008 2009 2010 2011 2012 2013
Literacy is no Longer an Issue…. Source: International Futures
Better addressing the needs of property seekers during these info search and consideration stages, help drive conversions Source: IPSOS 2013 & 2014 Base: 630 Malaysian property seekers
Internet Speed in Asia Huge room for improvement…. Imagine when our internet speed is like HK!
Investment into ICT Sector as % of GDP MY is focused in this area…… Source: International Futures
Influence Buyers Where They can be Engaged….
Not Forgetting that the >65 yrs Population Keeps Growing Source: International Futures
Don’t Forget the Seniors……
Almost ¼ of Mobile Users Search For Property Source: Google “Our Mobile Planet”
Which Part of the House Is Gaining Importance?
Infra Investment into Mobile Broadband in Malaysia Highest investment is into Broadband Mobile for the next 15 yrs Source: International Futures
Access to Mobile With Broadband Importance of mobiles Source: International Futures
Mobile Broadband per 100 Convergence of the new frontier…. Source: International Futures
Huge Potential for Growth to Connect with Buyers… Online Consumption Leads Ad Spend SINGAPORE MALAYSIA INDONESIA THAILAND AUSTRALIA Internet as % of total media consumption time 45% 42% 28% 60% Internet ad spend as % of total media ad spend 18% 9% Source: Nielsen, ADMA Digital Marketing Handbook(2014) 4% 7% 52%
Summary Post-GST The Real Impact on Buyers: Tomorrow’s Trends Today Company Proprietary and Confidential
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