clock 26-04-2021
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To Own or Not to Own, That Is the Question?

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In this modern age, Malaysia has an ever-growing population and rapid development that demands the levelling of land in order to make way for residential and commercial undertakings. With more and more focus placed towards the development of high-rises such as apartments, condos as well as offices, available land in Malaysia is getting scarcer by the year.

Yes, high-rise living may seem more idealistic in recent years, but some may still argue that living in landed properties for example terrace houses, semi-detached and bungalows would be unsurpassed. Though, it is hard to pinpoint which is better as it depends on the homebuyers themselves. To each their own as the saying goes. 


Discovering Opportunity in Uncertainty


It has been demised that through curiosity and looking at opportunities in new ways that one would map their path, and if such a window of opportunity were to appear, it is best not to pull down the shade.


The magic word here being ‘opportunities’, homebuyers must assess the value of a particular area, the price of the properties as well as the motive behind purchasing such big-ticket items, before making the ultimate leap. Despite the fact that prospective buyers may have an edge in a downed market when property sales are slow or when there is a surplus of homes for sale, there are no guarantees that their purchases would wield a profit. 


With the demand for landed properties being on the rise in recent years, statistics have shown that the acquisitioning of high-rise residentials are much higher in comparison due to its affordability factor and abundancy in supply. Nevertheless, with the lack of land space, the capital gain to be had would be much higher in relation to landed properties. 


Landed vs Condo – Which Is Better?


Let’s say one has RM800,000 to invest in properties, how should one go about it? Would it be better to invest it in landed properties or high-rises? While most would opt to get apartments or condominiums due to their high demand and availability, one should always first look into the pros and cons of landed properties versus high-rise residentials before making up one’s mind.


Back to the investor who has RM800,000 to spend. Should they decide to go for a condominium in a good residential area, then they would probably get a 3-bedroom, 2-bathroom, and at least 1,100 sq. ft. of space. However, should they opt for landed property in the same residential area, they might be able to get a 4-bedroom, 3-bathroom house with approximately 1,900 sq. ft. of space, not to mention sufficient land outside for a garden and a backyard.


Resale Value


Let’s talk about resale value. For landed residences, in most cases the value of such properties almost always appreciates. And down the line, when land becomes less and less available, the prices of landed properties will increase more drastically in comparison to high-rise residentials.


Even if these high-rises were to appreciate twice in value, the resale value will definitely be lower than landed properties. Of course, its common knowledge for condominiums and the such to require the maintenance to be borne mutually between all its residents.


Therefore, in the event that a large number of residents fail to pay their maintenance fees for instance, the result would be the condominium itself becoming derelict as time goes by. Further to this, it is important to look into the performance of the building management because an incompetent management will also drive the property price down and reduce the sale ability of the unit itself.


Hence for these reasons alone, landed properties will inevitably have a better resale value compared to high-rise buildings.


Maintenance Fee


With all the added amenities made available in high-rise residential, one will have to pay the maintenance fees regularly irrespective of what services are being used, be it common areas such as gardens or gymnasiums for example.


The maintenance fee charged to residents is usually done on a monthly basis, and the fee usually ranges from RM0.20 per sq. ft. to RM0.35 per sq. ft. depending on the developers. For landed properties, the responsibility for the maintenance of the premise is borne by the homeowners themselves, therefore not subjected to regular maintenance fees by a particular management company, unless of course it is situated in a gated and guarded neighborhood.


Privacy and Space


Most landed properties include a small plot of land that can be fully utilized by homeowners to do as they please. Some transform it into gorgeous gardens, some into recreational areas for their children to frolic around in. Some even go to such extents as to build extra parking lots. Due to this, landed properties are more appropriate for those planning on raising families and those who enjoy the freedom to renovate or expand the place without worrying about size constraints.


In relation to privacy, most landed properties have more space between them thus making it harder for one’s neighbours to hear noises coming from their household in comparison to high-rises where residents in condominiums, for example, are more prone to noise complaints due to close proximity living. 


Facilities


What high-rises lack in space, they make up for in common facilities, such as swimming pools etc. that are privy to residents only. Residents of landed properties, more often than not, would have to travel to certain locations to enjoy the facilities mentioned above, unless they live in bungalows with all the facilities built into them. 


Safety and Security


Landed properties lack security protection except for the gated and guarded communities that are equipped with proper fencing and security guards who monitor the movement of visitors. Nevertheless, some homes are usually fitted with their own security system, such as house alarms and CCTVs. High-rise buildings on the other hand, are generally safer as they are equipped with at least a 3-tier security system, including security guard checkpoints, 24/7 CCTVs and the usage of residents-only access cards.


With regards to long-term value, maintenance, facilities as well as safety, not forgetting if one is single or a married couple looking to buy their first home, a high-rise may be more sensible in terms of cost and space needs. Though, if one has a large family, and are in need of more space as well as buying for long-term living, then a landed home may be a better choice to cater to one’s needs.



The views and opinions expressed in this article are those of the authors and not intended to malign any company, individual or necessarily reflect the official policy or position of any agency or organization. Focal Times is a subsidiary of Maxworld Consulting Sdn Bhd, a regional organization founded by a mixture of agile and experienced corporate finance, venture capital and industrial experts. This establishment focuses on sharing current banking affairs, latest property developments and updates and more. 






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