Stocks Investing – My Road to Wealth & to Help People

Is this another indicator saying that our economy will slow down? This is a problem and also an opportunity for me.

Problem because I have to increase my spending because of inflation.

Opportunity because less potential buyers in real estate and more desperate owners to sell their properties.

The Star – Bumpy ride ahead for second-hand market

http://biz.thestar.com.my/news/story.asp?file=/2008/6/2/business/21401748&sec=business

IN contrast to the industry outlook forecast for auto companies, used car dealers are bracing for a rocky road ahead.

Challenges include stiff lending policies, rising fuel prices and weakening economic conditions, said various Klang Valley-based used car dealers.

Sonny Soh Sdn Bhd owner Sonny Soh said the various concerns had seriously dampened the value of used cars lately.

“Financial institutions are tightening up their loan approval process. It is much harder to obtain loans for used cars nowadays and the value (of used cars) is dropping,” he told StarBiz.

Soh said sales for the first five months of the year had been poor and he forecast that the trend would continue for the rest of the year.

“Fuel hikes will have a huge impact and high capacity cars would suffer the most,” he said.

The used car company sells both local and foreign used cars.

“So far, sales of local cars have been slightly better because they are generally cheaper,” Soh said.

Bangsar-based Zaibi Motor Sdn Bhd is also not optimistic about the used car trade.

Manager Dave Foong said the year thus far had been “quiet” in terms of sales.

“Oil prices are escalating and the economy is slowing down. Going forward, I see a drop in demand for used cars,” he said.

Another used car dealer from Kuala Lumpur-based Syarikat Motor SP also said the value of used cars had been depreciating over the past few years, attributing it mainly to increasingly tougher loan policies.

“Market demand for used cars has been dropping. Sales for the year so far have declined. The hike in petrol prices and dwindling economic conditions will only worsen conditions,” the dealer said.

A dealer from another KL-based used car dealership also had less-than-optimistic views about the trade.

“Sales so far have been bad and we predict it would continue to be bad for the rest of the year. Market demand has dropped and the economy is slowing down,” the dealer added.

Another dealer said sales had been flat and would continue to remain flat for 2008.

“We do not see any upturn (in sales) for this year,” he said.