The median prices for KL homes as at end 2016 is RM620,000. This is for units within the city centre and it is almost similar to the prices for Georgetown. Do note that this is for city centre. There are certainly areas outside the city centre which is cheaper and I think one main reason for Georgetown’s similar price is also due to the shortage of such units. Penang island is still, just an island. So, affordability should be based on median incomes and if these median incomes do not rise faster than house prices, then the affordability gets worse. Please do not rely on yearly increments yeah. Do more, get better and either get promoted within the company or outside the company. Would affordability worsen then? I think the answer should be how far it would worsen before the ceiling is reached and developers start to build SMALLER. This is the only way to maintain affordability. One city has reached a critical level. Its homes are now below 180 sq ft; Hong Kong.
Hong Kong’s flats, the newer ones could be as small as 161 sq ft, or just about enough to park a TESLA. They are not priced that low, usually HK$3 million or higher (RM1.5million) By the way, even with just one Tesla parked inside the flat, remember not to open the doors to the TESLA though. Is this healthy? Frankly, I do not think so, regardless of how the tiny little flat can still be very useful. This is what the 3rd richest man in Hong Kong said about these tiny flats, also known as nano flats. He is Lui Che-woo, the property and casino magnate of K Wah Group. According to him, homes have to be at least 300-400 square feet for healthy living. He also shared this when asked about home prices. “With the mainland’s 1.4 billion population and the growth of the Greater Bay Area, there’s so much money coming in that it’s hard for prices to drop.” Please do read the full article in South China Morning Post here.
Even in Klang Valley, homes are becoming smaller for all categories of homes. Bigger properties would become a rare occurrence in future. From homes that could easily park two segment D cars and still have space to open both the doors, we are now looking at 18 x 65 units. From over 1,000 sq ft high-rise units, these days most of the affordable ones are sub 900 sq ft. In fact there are already many sub 600 sq ft units which are dual-key. Many people would tell me that lifestyle is changing. My question remains the same, if you are the buyer and have a choice of 1,000 sq ft vs 500 sq ft, similar locations, which one would you choose. In fact, you can even ask developers if they love to build and sell 1,000 units versus building and selling just 500 units… 🙂 Seriously, affordability has kicked in. Let’s not hope for double digit growth in property prices because it may just crash the whole market. Imagine a RM500,000 home this year going up by RM50,000 per year? Haha. You get the idea… Happy understanding.
Please LIKE kopiandproperty.com FB page or Sign Up for free to get daily updates about the property market.
written on 25 Jan 2018
Next suggested article: New condo is close to my boyfriend’s office but not mine