A combination of COVID-19, an oversupply in residential properties and a lukewarm economy have made it a buyer’s market.
By Khalil Adis
Buying a property in Malaysia is a complex process unlike in Singapore.
Being a small country, one can rely on the Urban Redevelopment Authority’s (URA) masterplan to check for planning developments that will be taking place in the next 30 to 40 years.
In Malaysia, however, such information is scant making property buying an arduous and risky process.
When looking to buy a property, you should target the most affordable property but with the greatest potential for capital appreciation.
How can you do that? Easy, simply by applying the following 5Cs:
#1: Check the masterplan
A masterplan would typically define a township’s development in the next one to two decades.
It would also showcase the different designated land use and transportation plans within that particular township.
An area deemed highly desirable will attract businesses and residents.
Think about why properties in KLCC and Bukit Bintang are expensive whereas other areas like Bukit Beruntung are not popular.
With this in mind, you should find out as much as possible about your new neighbourhood.
#2: Check the transport masterplan
Generally, properties close to transportation hubs such as MRT or LRT stations can command a premium of between five and 10 per cent over the long term.
This is because people generally want to live close to transportation hubs explaining why Transit Oriented Developments (TODs) have become very popular in KL and Greater KL.
This demand translates to an appreciation of one’s property.
Are there MRT or LRT stations that are being planned in your area? What about expressways?
Study the upcoming Sungai Buloh-Serdang-Putrajaya (SSP Line) and LRT Bandar Utama–Klang Line (Klang Valley LRT Line 3) prior to your property purchase.
#3: Check budget allocation from the government
Government policies do have an indirect impact on a property.
For example, budget allocation for improvements in public infrastructure and new economic drivers will have an impact on new and existing homes in and around the vicinity.
So check where the government is building new hospitals and so on.
One good example is the development of the Malaysia Vision Valley in Negri Sembilan.
#4: Check for economic drivers
Have you ever wondered why properties in KLCC are so expensive?
This is because it is home to a number of industries such as petrochemical, banking, finance, tourism and so on.
The best strategy is to buy in an area that is not yet developed but where there are plans for various economic drivers.
A government-mooted economic corridor or a reputable developer that has experience in building townships are great indicators if the area will succeed or not.
#5: Check for job creation
This is like feeling someone’s pulse.
You need to check if the township you are eyeing for is going to be a ghost town or a happening place.
If it is the former, perhaps you should stay away.
If it is the latter, more and more workers will be drawn there, becoming a magnet for people and a hive of activity.
People are the lifeblood of a neighbourhood.
As the area becomes highly desirable, people will naturally want to live and work in and around the vicinity.
As there is an increase in demand, property prices in that area will also rise.
That is how a property appreciates over time.
Good luck in your property hunt!
An independent analysis from yours truly