Serviced residences record demand growth of 17.3 pct in 2019

Last update: 17/01/2020

KUALA LUMPUR, Jan 17  -- Serviced residences recorded the highest demand growth of 17.3 per cent last year among the three property types, followed by condominiums at 14.2 per cent, due to a modest drop in capital appreciation, according to the 2019 Portal Demand Analytics. 

REA Group Asia general manager of customer data solutions Premendran Pathmanathan said the serviced residences demand growth was also due to the lower growth in listings of properties compared with the higher growth in user visits on the property portal.

For the terrace house category which represents over 50 per cent of subsale residential transactions in the market, he said it posted a 9.0 per cent increase in demand last year. 

"For the capital growth, condominiums posted the lowest in 2019, declining 2.02 per cent, while serviced residences registered a drop of 1.66 per cent, while terrace houses recorded the highest with an increase of 3.16 per cent," he said. 

Premendran said this when presenting the report in conjunction with the opening of Home & Property Fair 2020 here, today. 2019 Portal Demand Analytics provide an overview of subsale property demand using the portal’s user visits and property listings data for residential subsale properties in Malaysia with a particular focus on Kuala Lumpur, Selangor, Penang and Johor.

Premendran further explained that Kota Kinabalu remained the top capital city with an impressive demand growth of 24.72 per cent year-on-year, while Petaling Jaya took second spot at 22.13 per cent, followed by Shah Alam (18.26 per cent).

"For Kuala Lumpur (KL), the demand growth improved to 19.8 per cent while its median pricing is still the highest in the country at RM516,000 in 2019. 

"The effect of Budget 2019's real property gains tax ruling which serves as a deterrent to property sellers has been most acute in KL, with owners of high-end properties unwilling to settle for a lower profit margin amid a slowing market," he added. 

Meanwhile, residential demand in Selangor grew 22.4 per cent in 2019 brought about by the higher number of visits especially by users checking out the terrace home category, while the number of listings remained constant.

As for Penang, the report revealed that the state saw a turnaround with demand figures surging to 10.6 per cent in 2019, attributed to the Penang South Reclamation (PSR) project, which was recently approved by the state government to be part of its multi-billion ringgit Penang Master Transport Plan (PMTP). 

"The government also announced that several PMTP projects including the PSR will be tendered out in the second half of 2020 and this has supported the demand growth," Premendran said. 

In the case of Johor, the residential property landscape remained sluggish toward the end of 2019 as it was the only major state to register a negative demand growth of 13.02 per cent due to property oversupply. 

"There has been an influx of property listings in the review period as a result of owners of numerous newly-built properties having received their vacant possessions," he added.