A Review on the Impacts of Macroeconomic Factors on Business Values of Property Developers: Case Study of Malaysia

Chai Woei-Chyi, Cheng Chin-Tiong, Tham Kuen-Wei and Chong Kim-Wing
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Chai Woei-Chyi: Tunku Abdul Rahman University of Management & Technology
Cheng Chin-Tiong: Tunku Abdul Rahman University of Management & Technology
Tham Kuen-Wei: Tunku Abdul Rahman University of Management & Technology
Chong Kim-Wing: Tunku Abdul Rahman University of Management & Technology

International Journal of Research and Innovation in Social Science, 2025, vol. 9, issue 3, 2157-2166

Abstract: The COVID-19 pandemic significantly impacted the business value of property developers worldwide, including Malaysia. This study reviews the effect of the pandemic on the price-to-earnings (PE) ratio of property developers, focusing on the top five developers in Malaysia, whose collective market capitalization represents 30% of the total listed property developers in the country. Statistical analysis indicates that the PE ratio of these developers experienced a drastic decline during the pandemic, reflecting the economic uncertainty, reduced consumer demand, and disruptions in the real estate sector. However, as the market adapted to new conditions, government interventions were introduced, and economic recovery gained momentum, the PE ratios rebounded post-pandemic, signaling renewed investor confidence and market stabilization. The findings align with global trends in stock market volatility and economic downturns, underscoring the real estate market’s vulnerability to macroeconomic fluctuations. This review contributes to a deeper understanding of the pandemic’s impact on business valuation within the property sector and provides insights for future investment strategies and policy considerations.

Date: 2025
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