Condo has been a popular development favoured by many due due to location. Many wanted to stay close to where they work etc but landed has become too expensive and thus condo becomes a primary choice. Thus, more condos were launched, prices were continuously upped everytime a new condo is launched. Latest news, there are now too much supply versus demand in the market. According to C H Williams Talhar & Wong Sdn Bhd in The Malaysian Insider today, the vacancy rate at luxurious condominiums in the country is expected to rise to an alarming 35% – 38% this year due to oversupply. The oversupply happened over the past three to four years where the growth was way too much and this will lead to lower occupancy and rents.
It’s managing director, Foo Gee Jen further elaborated that new supplies for this year would be concentrated on the few hotspots such as KLCC, Mont Kiara, Ampang Hilir and Bangsar. The continuous launch of new condos are due to the population in Klang Valley getting more affluent and thus this has resulted in the launch of more high-end condominiums, Foo further added. Overall, however, the vacancy rate for condo market including the lower and mid-segment market would see a vacancy rate of 20% for 2014.
If we look at the stats carefully, we can see that overall basis, for mid to lower end condominium, the occupancy remains very high, lesser than 20% are not occupied. Personally, I feel that luxury condominium is targeting a totally different market altogether. If I have just enough, I would not buy a luxury condo to stay. I would buy a mid to low end condo to stay and save more money for other investments or expenses. Urbanisation will continue in Klang Valley due to the various work opportunities. Many of these young executives shun away from flats but are acceptable to pay RM1,200 – RM,1500 on a sharing basis to stay in lower end condos. The only consideration would be the area that they chose because majority would also not want to be stuck in jams for hours just to get to and fro from office. Where are these lower end condo? Check online please.
written on 20 march 2014
Next suggested article: The story of Coffee and Property