Property Growth In 4 Major Malaysian States Despite COVID-19
As COVID-19 continues to rage throughout the country, these uncertain times can be felt across all economic sectors equally.
According to our Consumer Sentiment Study H2 2021, the worsening of the pandemic has caused many to feel that impact on their property buying decisions.
Malaysians continue to be uncertain about property prices, and experience delays in property transactions due to factors like the Movement Control Order (MCO), and various SOPs introduced.
It has also become more difficult to get a home loan approval, or even sufficient information regarding properties, as in-person visits to subsale homes and project showrooms are not allowed under strict lockdown measures.
Now, although COVID-19 has had a long-lasting impact on all Malaysians, the property market has begun to recover slowly, as more sectors open up in light of the ease of restrictions to salvage Malaysia’s economy.
Furthermore, at least 73% of Malaysians surveyed were keen to change their living situations – whether through renovation, owning their own home, or moving out.
Understandably, being forced to spend more time at home has made many realise the importance of comfortable living!
As consumer optimism towards property begins to gradually improve, we took a look at the areas in four major states that are currently witnessing increased popularity, so that you can have an idea of where to home hunt.
1) Kuala Lumpur
Compared to the last four quarters where prices contracted consecutively, things are finally looking up again as the median asking price for properties in Kuala Lumpur has rebounded to a 1.56% quarter-on-quarter (QoQ) gain in Q2 2021.
This is a rough indication that asking prices and the property market have begun to stabilise, in line with increased vaccination rates and business sectors slowly but steadily returning to normalcy.
Within the city centre, areas experiencing increased popularity and median asking prices are Jalan Ampang in KL City (+9.55% QoQ), Kenny Hills in Bukit Tunku (+6.60% QoQ), and Happy Garden in Kuchai Lama (+5.50% QoQ).
A popular neighbourhood, Jalan Ampang houses the symbolic Embassy Row and is one of Kuala Lumpur’s prime areas experiencing constant growth amongst convenient, family-friendly settings.
With various types of properties ranging from low-rise apartments and terraces, to luxurious high-rises such as Latitud8 and Agile Embassy Garden, local and international residents will be able to find a suitable, strategic home for them.
Close to Solaris Mont Kiara and Bukit Damansara, Kenny Hills in Bukit Tunku is regarded as Malaysia’s ‘Beverly Hills’ as it is one of the most exclusive and luxurious residential areas, with many prominent figures calling it home.
Although property prices in Kenny Hills may have faced a downward trend previously, it appears as the golden needle in a haystack for luxury property buyers itching to get their hands on exclusive homes at attractive prices.
Positioned right between Taman United and Taman OUG, Happy Garden in Kuchai Lama is a strategic, mature township that’s instantly recognisable due to its sturdy, long-standing presence since 1963.
Even so, Kuchai Lama continues to accelerate as it attracts investors searching for homes just beyond the border of the city centre. High-rise residential projects such as Residensi Far East and M Oscar are just some to look out for.
As all three areas are just a stone’s throw away from downtown Kuala Lumpur, they appeal greatly to working professionals based in the city. Even if their jobs aren’t city-based, its proximity to a myriad of amenities is highly favourable.
Selangor has been one of the hardest hit states throughout the COVID-19 pandemic. Nevertheless, median asking prices managed to remain resilient, growing by 1.18% QoQ in Q2 2021, a marked improvement from a mere 0.01% QoQ in the previous quarter.
The positive growth could be attributed to the state’s rapid effort of vaccinating its citizens, with about 71.2% administered with their first dose. This is a momentous feat as Selangor is one of the most populous states in West Malaysia.
Within Selangor, locations marking a decent growth in the median asking price are USJ Heights in Subang Jaya (+11.39% QoQ), Balakong in Kajang (+11.00% QoQ), and Jenjarom in Kuala Langat (+8.28% QoQ).
Properties in USJ Heights are in high demand for spacious, landed, and affordably priced homes in one of Subang Jaya’s most popular and strategic neighbourhoods.
Coupled with easy access to Klang, Shah Alam, Puchong, and Petaling Jaya, the well-matured area has everything needed – healthcare, emergency services, trendy cafes, shopping paradises, business centres, public transport hubs, and more.
Located on the fringe of Kuala Lumpur and just next to Sungai Besi, Balakong’s major shift stems from the existence of the Batu 11 Cheras MRT station, as well as up-and-coming shopping malls.
These provide extra leverage for new properties to appeal to investors, as the rest of the well-established neighbourhood is already populated with schools, medical centres, markets, eateries, and recreational amenities all around.
Although relatively small, Jenjarom is a growing location perfect for homeowners seeking peace from the busyness of big cities. It is also well-connected to other parts of Selangor via various highways and roads.
Slowly dipping its toe into urbanisation with its newest township project, Bandar Saujana Putra invites home seekers to upgrade their dwellings with fresh, affordable property types available for them.
After a long run of negative growth since Q4 2018, Penang’s median asking prices finally began to rise in Q2 2021 with an uptick of 0.95% QoQ.
This could be because of Penang’s low COVID-19 positivity rate – 3.36% in mid-June compared to Selangor at 46.08% – hence, more positive sentiments for the state when considering health and safety during a pandemic.
The areas seeing better asking prices in this region are Paya Terubong and Batu Uban (in Timor Laut) at +5.26% QoQ and +2.81% QoQ respectively, as well as Seri Tanjung Pinang in Georgetown at +4.12% QoQ.
Timor Laut on the island of Penang is one of the most popular cities in the north, combining the historic heritage of the past and modern 21st-century offerings for a cohesive, balanced lifestyle.
Here, anything and everything is within your grasp. This includes UNESCO World Heritage sites, shopping malls, diverse amenities and facilities, supermarkets, and of course, easy access to and fro the first Penang bridge to travel to the mainland.
Additionally, one can expect new developments such as Eco Terraces and Penang World City to liven up the area even more, attracting investors to strategic locations (Batu Uban) or green hills and nature (Paya Terubong).
Properties in Georgetown, the capital of Penang, are high-in-demand among locals and foreigners with a good mix of bungalows, semi-detached homes, high-rises, and terraces featuring attractive designs.
As there are several large-scale, seafront residential developments taking place near Georgetown, the allure of a beautiful seaview home coupled with reasonable prices and low-interest rates are hot on every investor’s list.
Median asking prices in Johor continued their downward momentum, with a dip of 0.15% QoQ in Q2 2021. Despite that, the decline is lower compared to Q1 2021, signalling the potential tapering off of the price drop trend.
One contributing factor to the dip in trend might be the Malaysia-Singapore border closure, in a bid to curb the spread of COVID-19.
As non-urgent travel is not allowed, this may have dampened the sale of Johor’s upmarket properties that rely heavily on interest from our Singaporean neighbours.
Certain areas in the state have been performing better in median asking prices in Q2 2021 – namely Taman Pelangi and Taman Universiti in Johor Bahru (+4.39% QoQ and +3.14% QoQ respectively), and Taman Nusa Bestari in Iskandar Puteri (+3.52% QoQ).
Taman Pelangi, located near the Malaysia-Singapore border, features landed homes as worthy investments for both countries alike.
The proximity makes it ideal for Malaysians working in Singapore, or Singaporeans working in Malaysia, to travel and call home temporarily.
The neighbourhood is well-equipped with schools, shopping malls, healthcare facilities, markets, and commercial areas for working adults and growing families.
In terms of accessibility, it is well-connected to Johor’s main roads and highways, along with regular public transportation options like buses and taxis.
With major appeal to students and academicians, Taman Universiti is just around the corner of Universiti Teknologi Malaysia (UTM).
The constant influx of new students and university personnel means a steady housing demand within convenient reach.
Property choices range from terraced homes, flats, and even a few bungalows that might pique keen investors.
The matured locale is also home to health clinics, shopping malls, mosques, supermarkets, and emergency services: All highly advantageous for students!
As for Taman Nusa Bestari, the neighbourhood consists of an eclectic mix of bungalows, apartments, cluster homes, terraces, semi-detached homes, and more to cater to every type of buyer.
Most notably, the Iskandar Puteri District Police Headquarters is stationed there. Hence, safety will not be a major issue.
Another plus point is that the homes in Taman Nusa Bestari are dominantly freehold, making them highly valuable for now, and in the future.
As we enter the last month of Q3 2021 and infection rates don’t seem to be slowing down just yet, it’s difficult for many to predict what may happen to the state of Malaysia’s economy and real estate industry.
Nevertheless, here’s what we might be seeing in the next quarter:
- Asking prices momentarily stabilised before moving back upwards, parallel to increased vaccination rates and a decrease in new infection rates.
- A tight race between developers as they compete to attract buyers with special packages or incentives, including benefits offered under the Home Ownership Campaign (HOC).
- Increased supply for residential sub-sale homes as owners cash out to lessen their financial burden.
- Good opportunities for investors and keen home seekers to have their pick of the property with attractive prices, low-interest rates, and interesting financial incentives.
While the lingering question of “Should I buy a property now?” is subjective to each person, bear in mind that safe and comfortable homes are needs, not wants.
With that said, good property deals don’t come by every day, so keep an eye out for the home you love and make sure to do all your necessary research beforehand!