The State of Malaysian Real Estate

Many people emailed and asked me about my ideas and opinions about the Malaysia real estate market in 2013. The frank answer is that my crystal ball is broken, and for the first time in my many years as a real estate broker I have no clue how the Malaysia property market is going to perform this year.

BrickHouse The reason for this is simple enough, really. General election is coming soon, and as any seasoned real estate investor will tell you, the key to growth in any property market is political stability. Now there’s a general “wait and see” attitude among property buyers and sellers, and as a result, the property market is suffering.

But still, I remain bullish with the prospects of the Malaysian real estate market. Land is scarce, especially in places like Penang where prices of properties have jumped over the recent years. There are pockets of growth at places such as Mont Kiara, Subang Jaya (especially in SS15), Bangsar, Sentul and the famed KLCC (Kuala Lumpur City Centre). The key is to identify these hot areas, and carefully research these properties. With the availability of online tools (such as MetroSherpa.com which is a map search tool) and property reviews, it is a breeze to gather data about real estate developments and land properties.

There is also huge growth in terms of real estate agencies over the past few years, with huge agencies such as Reapfield and Hartamas dominating the mass market. There are also boutique property agencies which focuses on the higher end of the market. Correspondingly, commercial real estate is also growing despite a glut of office space for rent in the Klang Valley area, especially in Damansara Heights and KL Sentral.

If you are looking to invest in your very first property then my advice to you is to stay put – at least until the general election is over. With political stability property growth is a sure thing. Also, consider investing in foreign properties – markets such as the United Kingdom (i.e. London) and Singapore are hot with Malaysian real estate investors. If you have sufficient cashflow then consider going overseas to look for real estate investment opportunities.

Now looking at the domestic market, consider investing in places like Mont Kiara. This area was super hot a few years ago with some choice developments by reputable developers such as Sunrise Berhad, but is relatively quiet over the last two years or so with some slight overheating of the market. This area is popular with expatriates, and continues to fetch good rental prices. Commercial developments such as One Mont Kiara are popular, but older places such as Plaza Mont Kiara is already showing some fatigue. Still, Mont Kiara gets my vote of confidence given its strategic location near the center of Kuala Lumpur and also its position as the number one preference for expatriate families next to Kuala Lumpur City Centre. Some good Mont Kiara condominiums are MK10 and Lumina. Go check them out!