Growing Demand for Serviced Residences
Landed properties remain more popular with buyers than serviced apartments.
However, iProperty.com.my’s “1H2019 Portal Demand Analytics” report shows that there is increasing demand for the high-rise dwellings.
Two months ago, the property portal, which is part of REA Group, launched a set of demand-driven findings, based on its user visits and listings data compiled from January to June 2019.
From the analysis, it showed three interesting trends in the market — pent-up demand in the serviced residence segment, the emergence of property hotspots in the outskirts of Kuala Lumpur and Selangor, and a shift of buyer interest to mainland Penang.
Serviced residences experienced the most significant growth in demand at 14.7 per cent, contributed by visits shifting over from condominiums.
Despite the higher demand, serviced residences (with 11 per cent of total visits) still has to play catch-up game with condominiums (with 23 per cent of total visits).
REA Group Asia General Manager (customer data solutions) Premendran Pathmanathan said there is a shift in demand from condominiums to serviced residences due to affordability reasons and location.
“The median price has depreciated by 8.2 per cent to RM490,000, thus making serviced residences more affordable with a slightly lower entry price within and around city centres.
However, at a national level, this building type median price is somewhat similar to condominiums (RM500,000) because serviced residences provide convenience and accessibility,” he said at the launch of the report.
Premendran said serviced residences should have the right address, accessibility to public transportation and availability of commercial elements.
Recent supply of this building type in the right location with the right elements has resulted in growing interests.
Terrace houses, meanwhile, have seen robust growth in demand by 3.7 per cent (with 32 per cent of total visits). This housing type, which makes up more than half of the residential property transactions in Malaysia, is still popular and has maintained positive capital growth of 6.7 per cent with a 3.7 per cent year-on-year increase in demand.
The analytics concludes that among the top four housing markets in Malaysia — Kuala Lumpur, Selangor, Penang and Johor, KL’s demand increased 3.8 per cent and Selangor’s was up 9.8 per cent, while that of Penang and Johor dropped by 4.4 and 16.1 per cent, respectively.
The “most-in-demand” areas in Kuala Lumpur are Batu Caves, Keramat, Sentul, Taman Tun Dr Ismail, Wangsa Maju, Damansara Heights, Pantai, Bandar Tasik Selatan, Kepong and Cheras.
Batu Caves, which tops the list, maybe officially a town within the Gombak district in Selangor. However, part of it intersects and falls in Kuala Lumpur. Batu Caves performed well in the first half of 2019, with 73.8 per cent year-on-year growth in demand compared to the previous year as there was an increase in the supply of serviced residences that were completed last year.
The “most-in-demand” areas in Selangor are Dengkil, Gombak, Semenyih, Cyberjaya, Sepang, Sunway, Bangi, Petaling Jaya, Klang and Bandar Utama.
Dengkil did well thanks to new launches by reputable developers. The recent opening of the RM150 million Gamuda Cove Interchange in the area may attract more visitors looking for subsale properties to iProperty portal.
The interchange provides direct access from the North-South Expressway Central Link (Elite) highway to the 615.06ha Gamuda Cove township’s commercial business district. Two additional linkages to connect Gamuda Cove and Cyberjaya via Persiaran Cove Selatan are in the pipeline.
In Penang, Batu Kawan tops the list as new townships and housing projects have started there.
The Penang Designer Village and the IKEA shopping centre, which opened its doors in mid-March, have also generated more interest in properties in Batu Kawan.
Others in the list are Nibong Tebal, Balik Pulau, Kepala Batas, Seberang Jaya, Simpang Ampat, Teluk Kumbar, Bukit Mertajam, Bukit Minyak and Sungai Ara.
Batu Pahat takes the No.1 spot in Johor, followed by Senai, Kulai, Pasir Gudang, Gelang Patah, Johor Bahru, Skudai, Permas Jaya, Ulu Tiram and Masai.
These areas were ranked according to the area/property listings which garnered the highest number of unique visits from Jan 1 to June 30, 2019.
The report, with additional data compiled from brickz.my, provides a transparent macro view of the current demand trends in the local residential property market.
The four states — Kuala Lumpur, Selangor, Penang and Johor — command more than 60 per cent of the property transaction market share.