Part 3 Different Perceptions of Affordable Luxury
Sarkunan said the usage of Industrialised Building System (IBS) and reducing the cost of construction will mean that developers can offer more luxury facilities to the development. Keeping the land cost low and applying for the increment of plot ratio instead of buying land with higher allowable plot ratio at a high price is another way to reduce cost, he said.
The future for affordable luxury properties look promising. “From what we are currently seeing in the market, the demarcation of luxury and affordable will be blurred further,” Aina said.
“More developers are going to market their products as luxury even though in reality those products might be more suitable for affordable market.
The impact is that products that are supposed to be in the affordable market segment will be priced as luxury products.
“This might lead to property overhang that may affect the industry or the developers, or worse, it may lead to a group of unsatisfied buyers,” she warned.
Knight Frank’s Sarkunan also expressed similar fears. Individuals from the M40 group may overstretch themselves by reaching for a luxury perception that they cannot afford and end up with a debt they cannot service, he said. It is the M40 who are more demanding when it comes to the luxury aspect, he said.