by race4home Disclaimer : This report is published only for general information and guidance. No action should be taken solely based on this report before obtaining specific professional advice. Race4Home.com.my will not be responsible or liable for any loss and damages of any use, misinterpretation, misused, or reference to the content or context of the report.
March 26, 2022 – There was a substantial increase in rental demand and sluggish home seeking activities observed starting from fourth quarter (Q4) of 2020, as home buyers face difficulties obtaining loans during implementation of Movement Control Order (MCO 1.0).
Malaysia Property Market Report (MPMR) Q1 2022 showed a substantial increase in the Rental Demand Index in Q4 2021, with a hike of 30.53% quarter-on-quarter (QoQ) and 57.91% year-on-year (YoY).
The Rental Demand is expected to grow further in the current quarter as consumers shift their focus from buying to renting. Also the increment could be in rapid rate as Malaysia’s Consumer Price Index (CPI) expected to increase beyond 5% yearly rate from the preceding year, driven mainly by the global economic situation impacted by covid and also Urkrain – Russian War.
In the beginning of 2022, the top 5 highest rental price transacted areas are still dominated by mature and established neighborhoods such as Mon Kiara, Brickfields, Setapak, Damansara & Subang Jaya. We foresee significant growth in the rental rate due to our economic is expected to further recovered in coming Quarter as Malaysia will reopen its borders to international travellers starting April 1.
Top 10 Demanded Areas In The Klang Valley Q1/22
| 1. Petaling Jaya |
| 2. Putrajaya + Cyberjaya |
| 3. Brickfields |
| 4. Setapak |
| 5. Shah Alam |
| 6. Ampang |
| 7. Cheras |
| 8. Bukit Jalil |
| 9. Wangsa Maju |
| 10. Mont Kiara |
Top 10 Suppllied Areas In The Klang Valley Q1/22
| 1. Setapak |
| 2. Petaling Jaya |
| 3. Brickfields |
| 4. Putrajaya + Cyberjaya |
| 5. Cheras |
| 6. Subang Jaya |
| 7. Ampang |
| 8. Bukit Jalil |
| 9. Shah Alam |
| 10. Salak Tinggi |
Top 20 Highest Average Transaction Areas
The overall transacted price on has been increase rapidly since commencement of Movement Control Order (MCO 1.0) in Q2 2020. This is mainly due many potential homebuyers are temporarily putting their purchasing plans on hold to ride out this period of economic volatility and causing demand build up rapidly over supply in the rental market especially within Klang Valley Area. Mont Kiara and Brickfields remained in its strong position in the top transaction price areas.
| RK | Area | Avg Rental Transaction Price | Rental Yield |
|---|---|---|---|
| 1 | Mont Kiara | RM3,050 | 4.27% |
| 2 | Brickfields | RM2,450 | 4.81% |
| 3 | Setapak | RM2,100 | 3.94% |
| 4 | Damansara | RM1,950 | 4.88% |
| 5 | Subang Jaya | RM1,850 | 5.17% |
| 6 | Petaling Jaya | RM1,800 | 4.74% |
| 7 | Sentul | RM1,750 | 6.80% |
| 8 | Ampang | RM1,700 | 4.51% |
| 9 | Shah Alam | RM1,650 | 4.63% |
| 10 | Bukit Jalil | RM1,600 | 4.57% |
| 11 | Cheras | RM1,575 | 4.30% |
| 12 | Batu Caves | RM1,500 | 4.20% |
| 13 | Puchong | RM1,500 | 4.42% |
| 14 | Sungai Buloh | RM1,420 | 4.80% |
| 15 | Kepong | RM1,400 | 3.90% |
| 16 | Putrajaya + Cyberjaya | RM1,350 | 4.01% |
| 17 | Wangsa Maju | RM1,300 | 3.92% |
| 18 | Sepang | RM1,200 | 4.80% |
| 19 | Kajang | RM1,150 | 4.70% |
| 20 | Salak Tinggi | RM850 | 3.04% |
The overall optimistic mood is also reflected not only in the rental market but also Sub-sales and New Launch performance.
According to the Property Market Review 2021/2022 report by Rahim & Co International Sdn Bhd, which was officially launched on Jan 27, in the first nine months of 2021, Malaysia recorded a total of 201,065 property transactions worth RM98 billion, a slight drop of 1.8% year on year in volume. However, there was a notable increase of 21.4% y-o-y in value.
Rahim & Co director of research Sulaiman Sahed says that after property market transactions fell in 2020 (-9.9% in volume and -15.8% in value) from 2019’s pre-Covid environment, the first half of 2021 saw a significant rebound as the economy and market gradually adjusted to a pandemic environment with a 21% jump in volume and 32.1% in value. However, the overall performance was dragged down in 3Q2021, when the FMCO kicked in. Among others, the residential sector has seen the most significant slowdown in terms of transactions.
“[Residential property] transaction activities showed growth in the first half but slowed down in the third quarter, resulting in an overall growth of 2.6% for the first nine months of the year. On the supply side, new launches in the primary market had dropped, as developers were still adjusting and affected by the pandemic and the country’s containment measures,” Sulaiman says, in presenting his speech at the launch of the report, adding that sporadic quick sales were observed for owner-occupier and domestic-focused markets.
It is also worth noting that several states in Malaysia have recorded encouraging residential property transaction performance, such as Kuala Lumpur (+10.1%), Selangor (+11.5%), Penang (+18.8%) and Sabah (+8.4%). Overall, residential property transactions in Malaysia grew 2.6% in the first nine months of 2021.
“The [residential] market recovery efforts were further supported by the extended HOC (Home Ownership Campaign) till the end of 2021, the exemption of RPGT (real property gains tax) and the initiatives provided under Budget 2022. A more holistic support was also given by the economic stimulus introduced throughout the year that aimed to restore the livelihoods of Malaysians and revive the business sectors,” Sulaiman explains.
Looking at overall property marketing in Malaysia, The secondary residential market accounts for 70% to 80% of total property transactions in the country, has lead the recovery in property market and it will continue to dominate the market, especially property within Klang Valley Area. It’s cleary seen from the data source shared by Rahm & Co publish on the report dated 26 February 2022 at The Edge Malaysia.
Disclaimer : This report is published only for general information and guidance. No action should be taken solely based on this report before obtaining specific professional advice. Race4Home.com.my will not be responsible or liable for any loss and damages of any use, misinterpretation, misused, or reference to the content or context of the report.
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