First Time Buyers Priced out of KL Property Market

First Time Buyers Priced out of KL Property Market

First time buyers in Malaysia have been largely priced out of buying landed properties in Kuala Lumpur after massive price escalation. Stories like that of Joshua Nonis, who couldn’t find a quality landed property within his budget of 200,000RM, are becoming all too common.

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Nonis found to his dismay that every property within his budget was either located far out of the city centre, or part of a problematic development.

Even properties in need of significant renovation work, to the cost of around 80,000RM or more were priced just outside his budget, said Nonis. In fact the only properties in the city within Nonis’ budget were those on leasehold, with 30-40 years left on the tenure, he said.

The project development manager eventually paid 170,000RM for a well-maintained, 12-year-old apartment unit in USJ Subang Jaya, Selangor. Nonis said he believed the 92 sq metre-unit offered “the best value for the money”.

Jason Tan and his fiance, another couple buying their first home paid RM220,000, for a 90 sqm serviced apartment in Cheras, Kuala Lumpur. Tan believed this to be a reasonable price for the 3 bedroom, 2 bathroom property.

“We’re starting small because a start-up family tends to be small. After a few years, if we want to upgrade our house, we can sell the apartment and buy landed property,” said the marketing executive.

The best of the stories seem to be of those who take time to carefully consider their options. Piano teacher Wong Mei Shan decided after much contemplation and a near-sale that the RM220,000 condominium unit in Bukit Jalil was too big of a financial commitment.

While the initial price was within her budget, the instalments plus maintenance charges would see her handing over 1700RM each month (maintenance charges payable over first 30 years).

“Buying a house is a huge decision. Because of the big sum of money you’re parting with, there’s no room for error or misjudgement.

“Properties in KL are definitely pricey. One has to sacrifice so much to come up with a reasonable sum, which at the end of the day, can get you only a piece of property with a small value in the market.”

Wong confirmed what Nonis had said about landed properties, she said that they were out of the question for her, because they are either too expensive, or are located too far from the city centre.

Unlike Tong Wen Hui who is set on buying a landed property with his RM300,000 budget. The real estate boom has, however, forced the copywriter to be more diligent in her research.

“Who the developer is a big factor because ultimately, how my house turns out to be lies in the hands of the developer. I have to find one I can put my full trust in.”

Nonis said some houses came with a premium price tag because of added values like concept living, for example, resort-styled houses or eco-friendly housing. “It’s a lifestyle they are selling.”

Photo credits: Adamina via Flickr