Melaka for property investment? “I thought it’s just a holiday destination.”

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Where are the 4 major property investment destinations in Malaysia? The Klang Valley (or Greater KL), Iskandar in Johor, Kota Kinabalu in Sabah and Penang island. If one has invested in a property, it’s most probably within these four places. When it comes to property investment, it’s always about identifying opportunities earlier than others. Else, we will then come to the statement of ‘Aiya, I should have invested earlier.’ If you ask me when was the best time to invest in a property, I would tell you it’s at least 20 years ago. 1998 would have been a perfect year for property investment. Properties were cheap and nobody was buying. That ‘best time’ has PASSED. Today, the best time to buy a property is when we are ready to buy a property. Here’s one potential in Melaka (starts from RM233k). Ready in terms of our financials (please do not borrow from Ah Long to buy a property), knowledge (please do not simply buy) and investment mindset (overview and long term).

Today, we talk about Melaka for property investment. Everyone knows this is a favourite tourist destination for Malaysians and non-Malaysians. I know because I am there at least twice a year and I am always surrounded by foreign tourists. From our neighbouring countries to China, Japan, Korea and even European countries, they just love historic Melaka. Looking at this number versus the property market meant opportunities open up.

Tourism is HUGE. (lots of tourism ringgit into Melaka every year) For 2018 alone, it is estimated that 17.8 million visitors will visit Melaka. Article here. This is 18x more people than whole population of Melaka; 900,000. This meant that the demand for accommodation is growing fast. This is also one main reason why choices for accommodation becomes limited if we were to book very close to our travel period.

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Residential oversupply in Melaka? Erm… At a time when the whole Malaysia is worried about the unsold and completed units which is at a record high, Melaka’s oversupply numbers are very low. In fact there does not seem to be any issue at all. On a yearly basis, within the past 10 years, total unsold residential units in Melaka is only 725. Briefly, this is just 73 units per year for a state with 900,000 population. Article in MalayMail here for reference. TheMalayMail Online, This is why when we are looking at buying a property, perhaps residential units at affordable price and attractive design should be a key choice. Here’s one potential.

Industrial sector remains key sector in Melaka. Before everyone thinks Melaka is only about tourism, we should also note that within just 9 months in 2018; Jan – September, MIDA approved RM1 billion worth of investments into Melaka. The investments were into 7 sectors; medical, food, electronics, petroleum, transportation, metal manufacturing and non-metallic mineral sectors. All these will continue to create job opportunities and this will in turn drive up demand for properties too. Melaka was also said to be one of the few sites being considered for the New National Car Project too. 

Multiplier effects from Melaka Gateway. Melaka Chief Minister Adly Zahari has reiterated that the Melaka Gateway project is continuing. Based on earlier reports, this is a RM43 billion development. It consists of three man-made islands and a natural island that will include the Melaka International Cruise Terminal, developed in partnership with US-based Royal Caribbean Cruises Ltd (RCL) on its first island. Chief Executive Officer and Founder of Melaka Gateway Datuk Michelle Ong shared that the project is estimated to create between 40,000 and 45,000 jobs over 10 years. Projected economic multiplier anticipated is RM1.188 trillion for the local economy as well as drawing further local and regional investment.” Full report here.

Accessibility is key. It’s easy to notice Singaporean registered cars in Melaka because there are many. Beyond just Johor which the Singaporeans could go daily, they may prefer to drop by Melaka during the weekends too. Melaka is also a favourite destination for working people in KL / Selangor too. It’s one destination which fulfills everything a family wants and it’s just 1 hour and 40 minutes away. Briefly, Greater KL’s growth will continue to benefit Melaka too.

Special and attractions APLENTY. Melaka is a UNESCO Heritage city. In other words, this is an internationally acknowledge heritage city. Beyond the historical sights which is already famous, Melaka has great diversity of food (which is one reason why I always get heavier every time I visit Melaka). ENCORE Melaka has also arrived to rave reviews from everyone who has visited this international class dazzling theatre. There are also many theme parks in Melaka too.

Future is certain. Melaka is one of the stops in the High Speed Rail KL – SG route. Our Prime Minister Tun Dr.Mahathir has reiterated that the HSR is merely postponed and not scrapped. With the date of completion now extended, this meant that we have more opportunities to buy and watch as the capital appreciation for the property grows with time. For everyone’s information, less than 10% of Singaporeans own a car. HSR is going to be a catalyst for the visitors from Singapore into Melaka because it’s cheaper than renting a car and drive in or wasting time waiting at the airport for flights.

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There are a lot more reasons to visit Melaka but beyond all these attractions, we should also acknowledge that Melaka continues to be very localized and authentic. Just walk along the Jonker’s Walk in the evening and we could see that the stalls are manned by locals and not foreigners. This is unlike many other states where many if not majority of all the stalls are already manned by foreigners, even the food stalls!   It’s also cleaner than many other towns and cities and I think this is one major reason why Singaporeans love Melaka too. When we look at property investment, the growth of the city is extremely important for long term capital appreciation.  I think Melaka has that oomph worth taking a serious look. Here’s one potential (starts from RM233k). Happy investing. 

Next suggested article: Advantages of buying new vs secondary

kopiandproperty.com

kopiandproperty.com

kopiandproperty.com is everything about property related writings and news. Enjoy reading with a latte.

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