Every time someone tells me that property prices are spiralling out of control, I would just smile. It’s hard to debate with someone who has a totally different idea about property prices and affordability. Reminder. Property prices can only keep increasing when people could afford it. Here’s one earlier article. Key driver for property demand will always be affordability If people could not afford it at all, the property bubble will burst to make the property prices affordable again OR… people buy a little further for cheaper properties OR… developers build smaller units to manage the prices. Between these three situations, one is actually within our control. The world can be unfair to us but we could not change the world, we could only change ourselves.
Let’s refer to Brickz.my for the median prices for all major towns in Malaysia. At least it will show that prices are not spiralling out of control. This is also the site which I refer to nearly daily because it’s important to verify whatever people are saying. For example, your friend could tell you that last year he sold his property for RM500,000. If you know the address of his property, you could check it out and verify if he’s telling the truth! 😛
We can see that among major towns / cities here in Malaysia, that little place which is most expensive is KL city centre (Think KLCC and surroundings). The median price is RM940 per sq ft and RM1,000,000. In other words, RM1,000,000 will buy us a unit slightly bigger than 1,000 sq ft. I think my good friend will be happy to see this. She is only 32 this year but already own two units within KLCC surroundings. It’s important to have KLCC at the top of the list because this will be the main driver for price growth in areas surrounding it and further away. Remember, if KLCC is still RM500 per sq ft today, there’s no chance for further away areas to reach RM500 per sq ft.
The last in the list is Ipoh, my hometown. When it comes to median, it’s only RM196 per sq ft and the price is RM204,750. If everyone thinks this is the typical property price, then I can safely tell you that it is not true. It’s just that for many of the established areas, it’s already a mature neighbourhood and not many transactions come from these areas. With more homes being built further away, it becomes more affordable and this is why the transactions are also showing this trend as well. Happy referring to all the rest and please feel free to comment as well. Happy understanding.
written on 26 Jan 2019
Next suggested article: Median price below 30, think property perhaps?