As the fundamentals of the property market continue to improve, property developers and real estate agencies should enjoy an improvement in their bottom lines this year, according to RHB Group Research.

The brokerage notes that new home sales has continued to see momentum, which resulted in healthy unbilled sales for property developers that will be progressively recognised upon completion in 2021.

It points out that most property developers – with a high proportion of recurring income streams (50-80%) from investment properties – should also see a rebound.

This will come on the back of an absence of rent rebates and an overall pick up in the economy, it says.

Moreover, the brokerage adds that it does not anticipate further write downs in 2021, or impairments to capital values, with cap rates remaining stable.

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“These factors should help sustain a healthy rebound in earnings and dividends for developers and real estate agencies,” RHB analyst Vijay Natarajan writes in a note dated Jan 6.

RHB has maintained its “overweight” rating for the real estate sector.