Despite fears over an oversupply of houses, the Iskandar Regional Development Authority (IRDA) believes that Iskandar’s future population would be able to absorb the large number of residential properties being built by Chinese developers, reported The Straits Times.
From 1.45 million in 2005, the economic corridor now has a population of 1.8 million. But by 2025, the economic corridor is forecasted to house three million people.
Eight years from now, Iskandar would need around new 500,000 houses, said IRDA CEO Ismail Ibrahim. In comparison, the Chinese developers are constructing another 20,000 to 25,000 residential units.
If Iskandar’s population increases as forecasted, a supply glut is unlikely to happen despite the huge number of apartments being constructed by Chinese developers like Country Garden.
Last year, Country Garden sold 16,000 high-rise apartments in its Forest City project, which is sited on four man-made islands off Johor. It has also reclaimed 2.24 sq km of land since March 2015, and it intends to keep going until it hits 20 sq km.
Its other project is Danga Bay, which was unveiled in 2013. While this only has a total of 9,400 units, this development is still larger than those in Singapore, considering that developers in the city-state only sold around 8,300 private houses for the whole of 2016.
But due to concerns over a possible supply glut, experts revealed that the prices of luxury condominiums in Iskandar is estimated to have declined by 5 to 10 percent since 2013.
Despite reports of falling prices, many people are still investing in Iskandar properties. For example, about 30 per cent of buyers in the 9,400-unit Danga Bay project comprises Singaporeans, who will be receiving their keys in the next few months
Singaporeans are not just buying properties in Iskandar for long-term capital gains, but also to enjoy a better lifestyle as it’s more affordable to acquire a spacious landed home there, far from the bustle and hustle of Singapore.
“It is so tranquil, there’s no sound of traffic. My mother and wife are so happy there,” said 51-year-old Vivek Parasher, a business development director.
While he owns a condo in Singapore’s Bukit Batok area, he is eager to relocate to his landed home in Iskandar even though he has to spend to two hours daily to commute between his home and office.
But Vivek’s travelling time is expected to be shortened once the Rapid Transit System that links Woodlands to Johor Bahru is ready, along with the highly-anticipated Singapore-Kuala Lumpur High Speed Rail (HSR) that will pass through Iskandar.
Experts are optimistic that once these transport links are completed, more Singaporeans will buy houses in Iskandar.
In fact, enquiries about residential properties in the region have increased by 10 percent to 20 percent since 2015, said Eugene Lim, Key Executive Officer of property agency ERA.
However, he noted that demand remains lukewarm, with a “few hundred” Singaporeans at most mulling to reside there.
In contrast, ERA’s Regional Director for Malaysia Ryan Khoo is more bullish, estimating that “tens of thousands” of Singaporean retirees are tempted to live there, while leasing out their flats in Singapore to leverage on the stronger exchange rate of the Singapore dollar against the Malaysian ringgit.
Furthermore, IRDA CEO Ismail Ibrahim is confident on Iskandar’s long-term outlook, pointing out that the region secured RM32.15 billion (S$10.4 billion) in investment commitments, exceeding its RM25 billion target.
Among properties located in Iskandar Malaysia are:
Image sourced from Iskandar Insider
Radin Ghazali, Content Writer at PropertyGuru, edited this story. To contact her about this or other stories email radin@propertyguru.com.my
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