Press Release: iProperty.com.my- Renters Can Continue to Benefit from the Property Market in 2021
- Visitorship to residential rental properties was more as compared to visitorship to properties for sale on iProperty.com.my in 2020.
- National demand for residential rental properties in 2020 was at -12.6%, the dip was mainly caused by the growth in rental property listings outpacing rental visitorship.
KUALA LUMPUR, 30 MARCH 2021 — iProperty.com.my, Malaysia’s No.1 property site, today unveiled the 2020 Portal Demand Analytics (Rental Market), an overview of the residential rental property demand using iProperty.com.my’s user visits and property listings data for residential properties in Malaysia with a focus on Kuala Lumpur, Selangor, Penang, and Johor. The rental analytics looks at four property types: terrace house, condominiums, service residences, and apartments.
The analytics’ key takeaway is that many Malaysians are more inclined to rent due to the impact caused by COVID-19. Post-pandemic user visits to iProperty.com.my have been on an upward trajectory as more property seekers are shifting to digital platforms. In February 2021, iProperty.com.my recorded an all-time high of over 10 million monthly visitsi. In addition to a +51% year-on-year (Y-o-Y) growth in visitsii, iProperty.com.my saw the level of property enquiries through its platform increased by +20.4%iii in February 2021 when compared to last year before the first Movement Control Order (MCO).
Surge in Residential Rental Property Listings affects National Rental Demand Figures
Rental visitorship to iProperty.com.my increased as users opted to rent due to uncertainties caused by the COVID-19 pandemic. Although rental visitorship has grown, the increase in rental property listings has outpaced it, causing the national rental demand figure to dip to -12.6%. Overall, the rental yield for terraced houses was at +3.3% from +3.4% in H1 2020. The median asking rent for condominiums was at RM1,800, from RM1,900 in H1 2020, while for serviced residences, the median asking rent was at RM1,600 from RM1,700 in H1 2020.
Renters Looking for Spacious Units in Kuala Lumpur
Demand for residential rental properties in Kuala Lumpur was at -7.7% Y-o-Y for all building types. One reason for the decline was the lower rental demand for the apartment segment caused by unemployment in the capital city. Overall, the rental yield for terraced houses was at 3% from 3.2% in H1 2020, while condominiums was at 4.1% from 4.3% in H1 2020. The median asking rent for serviced residences, which was RM2,300 in H1 2020, dropped to RM2,000 by the end of 2020. Visitors in Kuala Lumpur are seeking four-bedroom terraced houses between 1,500 to 2,000 sqft in size as well as condominiums between 1,000 to 1,250 sqft in size, or a minimum of three-bedroom units priced below RM2,300.
Selangor’s Suburban Areas Remain Top Choices for Renters
Demand for residential rental properties in Selangor was at -10.3% Y-o-Y in 2020 for all building types. However, terraced houses recorded a demand growth of +2.8% making Selangor the only state in Malaysia with a positive growth in 2020. This can be attributed to renters moving to suburban areas seeking spacious living spaces in Bangi, Rawang, Kajang, and Cyberjaya. Many visitors were looking for double-storey terraced houses priced between RM1,200 to RM2,000 and between 1,500 to 2,500 sqft in size. Ulu Klang is the area in Selangor with the highest growth in demand, growing +32% Y-o-Y. A large number of visits were for condominiums priced below RM 2,000 and between 1,250 to 1500 sqft in size.
New Entry, Sungai Dua Appears as Penang Most In-demand Rental Area
The rental demand figure for Penang in 2020 stood at -18.3%. As a tourist state, Penang’s economy was affected by the pandemic although the situation improved during the year-end holiday period, providing much-needed businesses for hotels and short-term accommodations. One positive finding is the continued rental demand for apartments and flats in the industrial areas of the state including Sungai Dua, Bayan Baru, Bukit Jambul and Perai (mainland) as workers look for affordable accommodations. Sungai Dua is the most in-demand area in Penang with more than half of visitors interested in apartments below RM 1,000. Demand for rental properties in Bukit Jambul is also encouraging due to visitors looking for flats priced below RM700 and between 500 to 750 sqft in size.
Pengerang Emerges as the Most In-demand Rental Area in Johor
Being the state with the most unsold properties in Malaysia, the Johor residential rental property market remained sluggish as newly completed units remained idle, resulting in a drop-in demand figure by -27.8% Y-o-Y for all building types. In addition, the closure of the border between Singapore and Malaysia has impacted the rental market in Johor Bahru. Nevertheless, the expected completion of the Rapid Transit System (RTS) project in 2026 looks to improve Johor’s residential rental property demand. The industrial city of Pengerang is the most in-demand area in Johor thanks to its role as the southern oil and gas hub. Many visitors were looking for double-storey terraced houses priced between RM1,400 to RM1,700 with built up sizes of between 1,500 to 2,000 sqft.
Commenting on the release of iProperty.com.my 2020 Portal Demand Analytics (Rental Market), Shylendra Nathan, General Manager of iProperty.com.my said, “2020 was a year that favoured tenants more than landlords. The entrance of newly-completed projects in an already crowded market has caused landlords to drive down their rental rates as they compete to attract a limited pool of financially stable tenants. Indeed, tenants are now in a better position to negotiate prices and this has been reflected in slight drops in median asking rent prices and rental yields. Although the lower Overnight Policy Rate (OPR) has reduced monthly loan instalments for property owners, the bigger drop in rental income is currently offsetting the lower financing cost advantage. ”
“On a brighter note, the ongoing vaccination program has provided much-needed optimism for the local property market. Although the recovery will not be as fast as many would expect, it will definitely boost the property market’s recovery in the first half of 2021. As our country begins the journey towards achieving herd immunity, we expect to see higher consumer confidence in the property market as a result.”
You can download a copy of the iProperty.com.my 2020 Portal Demand Analytics (Rental Market) at www.iproperty.com.my/newsroom
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