KL Property Market - where is good?

[chrissy]

As a local, I feel that the property market in Malaysia is currently inflated.

Prices jumped significantly in the last 6 - 9 months for both units and houses. Whilst there may still be room for growth for houses, it is a general sentiment that the market for apartments (even high end ones) is saturated and overpriced. Whilst the Mont Kiara area is a nice place for expats to live in, I believe that rental yields for apartments are coming down due to oversupply. Also, was talking to a valuer and he also places Mont Kiara apartment current prices as being overpriced at the moment and will most probably soften. Landed properties are alright for the moment, and would represent better value in my opinion - as a gauge, a 2 story link house in Sri Hartamas (adjacent to Mont Kiara) is in the region of RM1.2mn (AUD400k+) which is pretty good value to me. Another consideration is security - there are frequent break ins, and a rather inefficient police force, so gated communities which are patrolled by security companies are gaining in popularity.

I believe that the property market in Malaysia actually gives better CG and rental yields than Australia based on past experience and current trends. However, as Scobie pointed out, racial discrimination against minority races in Malaysia is pretty overt and are a push factor for many to consider migration - We invested in a unit in Australia simply to ensure that we have a bolt hole in case anything happens (very unlikely, in our opinion, but we still want to be prepared!), and not so much the capital gains / rental yields which we believe would be markedly less than if investing in Malaysia.

 

[Melbournian]

As a local, I feel that the property market in Malaysia is currently inflated.

Prices jumped significantly in the last 6 - 9 months for both units and houses. Whilst there may still be room for growth for houses, it is a general sentiment that the market for apartments (even high end ones) is saturated and overpriced. Whilst the Mont Kiara area is a nice place for expats to live in, I believe that rental yields for apartments are coming down due to oversupply. Also, was talking to a valuer and he also places Mont Kiara apartment current prices as being overpriced at the moment and will most probably soften. Landed properties are alright for the moment, and would represent better value in my opinion - as a gauge, a 2 story link house in Sri Hartamas (adjacent to Mont Kiara) is in the region of RM1.2mn (AUD400k+) which is pretty good value to me. Another consideration is security - there are frequent break ins, and a rather inefficient police force, so gated communities which are patrolled by security companies are gaining in popularity.

I believe that the property market in Malaysia actually gives better CG and rental yields than Australia based on past experience and current trends. However, as Scobie pointed out, racial discrimination against minority races in Malaysia is pretty overt and are a push factor for many to consider migration - We invested in a unit in Australia simply to ensure that we have a bolt hole in case anything happens (very unlikely, in our opinion, but we still want to be prepared!), and not so much the capital gains / rental yields which we believe would be markedly less than if investing in Malaysia.

agreed - some areas are current on the high side. then again there are lots of areas to invest in in malaysia as you mention as they are bargains to be made.

However if many of the infrastructure projects go ahead - u going to see a big upside to property prices.

 

[HappyCamper]

Been watching this thread with interest. Can someone more familiar with the market comment on the gross rental returns for median priced property in KL / PJ? What are vacancy rates like? Are there strong tenancy laws to protect landlords?

Also, what effect has the $500k minimum for foreigners had on properties above and below this price?

 

[kum yin lau]

Hi, just back from KL. Prices have indeed gone up, even from last year. This is across the board, all properties. The house I sold in Sri Petaling for $310K back in 97 is $900K.

Condos probably haven't gone up as much.

Lower end properties, the boxes I considered buying last year, have gone up 25%.

Rents have gone up much further. $55K units rented for $500 per month, now $700 per month.

My friend showed me the low cost block near The Curve, the only low cost flats there. Paid $70K at auction, rented @ $700 per month to a restaurateur who wants it for his employees.

The look of the residents frightened me.

Individual rooms in low cost flats are renting for $350 per month.

Hope this helps.

KY

 

[Wunderbar]

The only reason you'll buy there is to hope for a major AUD correction to make that 20% gap.

 

[fuister]

Hi all,

Interesting read. I am a local to KL and I would not be investing in KL unless you are planning to live there.

Property prices are going through the roof, is it a bubble? i dont know but it is definitely rising too high too fast. I have got 2 family members that bought in Echo park, shah alam for 500k and its now 1 mil in 2 years I think. This is not normal.

The biggest risk about KL/Malaysia is political. The economy is doing well and so on true, but I think the on going tensions have the potential to blow out.

Also unless you are familiar with the msian market it is not easy to obtain fair value. The system is not as transparent and conveyancing can take a longggggg time.

This are all big picture views and may well vary in various suburbs/towns.

 

[Melbournian]

Hi all,

Interesting read. I am a local to KL and I would not be investing in KL unless you are planning to live there.

Property prices are going through the roof, is it a bubble? i dont know but it is definitely rising too high too fast. I have got 2 family members that bought in Echo park, shah alam for 500k and its now 1 mil in 2 years I think. This is not normal.

The biggest risk about KL/Malaysia is political. The economy is doing well and so on true, but I think the on going tensions have the potential to blow out.

Also unless you are familiar with the msian market it is not easy to obtain fair value. The system is not as transparent and conveyancing can take a longggggg time.

This are all big picture views and may well vary in various suburbs/towns.

Eco park is not something i would invest in. first it is largely linked to certain ethnic groups. and 1 million is too much

Yes - it is hard to find a malaysian place with fair value but there is if you search hard enouygh and if you're keen to have a 2nd home this would be the place. (behing the benefits of the scheme)