How high can Johor property market be with the completion of the RTS? Some recent movements.

How high can Johor property market be with the completion of the RTS? Some recent movements.

Let’s read what the people from the industry are saying

Article in businesstimes.com.sg “Johor’s property market may be bracing for a breakout year ahead of the Johor-Singapore Rapid Transit System (RTS) Link’s completion, with the cost of land around Johor Bahru station jumping from about RM700 (S$220) per square foot (psf) three years ago to between RM1,000 and RM1,500 psf today.

This repricing marks a clear shift in Johor’s cycle, market players say, from broad-based growth to a far more selective market where connectivity, above all else, now determines value.

“Olive Tree noted that enquiries and transactions are increasingly concentrated in corridors with direct access to the RTS or major highways, while projects in more isolated locations require deeper discounts or longer selling periods to move units.

JLL cautioned that investors should model returns realistically. Johor’s current story is one of capital growth first, followed by more moderate rental expansion as the market matures.” Article in businesstimes.com.sg

Is JB property market really sustainable?

When I spoke in a property event in Singapore last year (2024), a question came to me from the crowd. “Is JB property market really sustainable?” I smiled. This is a very good question but the answer is even more simpler if you ask me.

Do we agree Singapore government is both effective and efficient?

Do we believe Singapore will continue to attract huge investments into Singapore?

Do we believe Singapore’s economy will continue to grow by leaps and bounds?

If the answer to all these three questions is a Yes. Then the answer to the question of JB property market is also a Yes.

Keeping property prices down need some external support too

Frankly, do we really believe Singapore’s government can continue to keep cost of property low and still be so effective and efficient? If we truly believe they could, then they will also need some help from JB property market yeah. When there are some available choices just an RTS ride away, then the pressure for prices to keep increasing will slow down. This is also why Singapore is strongly supporting the JB-SEZ yeah. Please do not think they support JB-SEZ because they just want to help JB to grow yeah. This is the effective and efficient Singapore government.

More investments more demand for a place to stay beyond just HDB flats

Second question of whether huge investments will continue to pour into Singapore is also a Yes. Just need to remember that if these investments come and jobs are created and this company wishes to provide housing to their top management, it would be foolish to put them up into some private condos inside Singapore yeah. Those would be cost-prohibitive. Below are some examples:

The cost of renting for just 10 top management is as follows: S$3,400 x 10 people = S$34,000 per month. That’s RM110,000 per month or RM1.32 million per year. The point is not whether the company can afford or not afford yeah. The point is whether Singapore can offer both the talents and the cost effectiveness to attract them versus letting them think of other major cities instead. With the help from JB, it’s a yes.

Singapore’s economy to grow by leaps and bounds?

I am very sure Singapore’s economy will continue to grow. In other words, businesses will keep growing their business every year. In other words, they will need to hire more people. If we understand the population growth in Singapore, it’s NOT enough to even increase the population yeah. So, they will need to hire from outside. People who come to work will need a place to stay. In other words, there will be more demand for housing. In other words, it’s either increase the supply or see prices move up faster than everyone wanted. So, JB property market is thus a natural choice in helping to increase the supply of homes.

All the best to Singapore! Please grow more. Grow ever faster and grow ever more diversified too. JB property market is waiting.

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