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Iskandar needs MORE homes yea, hundreds of thousands more.

Posted in Iskandar / JB Property

When it comes to property investment, my personal guide has always been the 4Ps; People, Price, Policy and Preference. The first P which is People. Without population in the first place or a continuous growth in population, we can forget about the potential for the property we are about to buy. This explains the mature and the upcoming neighbourhoods. The second P is Price and if the homes are just too expensive for the general population, how would we sell in the future? The 3rd P; Policy may have some effects. For example, Free-Trade Zones or even Tax-Free Status. These policies would usually help to build up some potential catalysts for other Ps to start moving up. In Iskandar, it has often been stated that there’s just too many homes versus the demand for it. Let’s look at an article in dailyexpress.com.my: Iskandar Malaysia needs 1.2m residential units by 2025

Well in the article, this was what Iskandar Regional Development Authority (Irda) Chief Executive Officer (CEO) Datuk Ismail Ibrahim has to say. Iskandar Malaysia needs another 1.2 million residential properties by 2025.This is because of the economic region’s rapidly growing population. He shared, “When we launched Iskandar Malaysia in 2006, the population was about 1.49 million. Today, the population has grown to 1.95 million and by 2025, it is forecast to reach three million. This growth resulted from migration, many are coming here to seek employment. Based on this, we anticipate for residential properties to climb to about 1.2 million units by 2025.” At this moment, there are only about 700,000 residential units currently available in Iskandar Malaysia. Please refer here for that full article for reference. 

He then shared something very important. This is the 2nd in the 4Ps of property investment. He said, “When we talk about supply, we must be able to meet the demand based on household purchasing power. That is why it is very important for us to work together with authorities and housing developers to ensure the supply of future housing matches demand, especially from the less affluent groups.” (By the way, this is also the reason why we cannot let the market correct itself. If we need more affordable homes, the government must intervene and make it happen. It is very certain that more homes are definitely needed. The only issues is the type of job that is currently available and this will determine the salaries being paid which will in-turn determine the price level of the homes that these new professionals in Iskandar Malaysia would be able to pay. In brief, homes are NEEDED but the request for lower property prices must be HEEDED. Happy following the story of Iskandar Malaysia.

written on 8 Aug 2018

Next suggested article:Expert Series with Ryan Khoo: Iskandar Malaysia’s potential and what’s really happening

 

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