Which house type has appreciated the most since 2010?

Which house type has appreciated the most since 2010?

Debate of ‘only landed property will increase in price, high-rise units too many.’

Maybe we start with some real numbers? Looking at real transactions numbers versus some prices listed in a property listing site? We look at the total of all the transactions and for all the different property types. Let’s not just look at one type in one particular year. We also look at a historical trend so that we have a general idea on what has happened. Which are the better and faster years and which are the not-so-good and not so high increase years? Maybe even negative price growth years? All below. From National Property Information Centre (NAPIC).

Best, Second, Third and Last?

If we look at the periods of 2010 to 2024, the best type of property is the terraced (this is the home where your right and left neighbor are ‘glued’ next to you) where the price appreciation was a whopping 150 percent. Based on an average price of RM250,000 in 2010, the same property is now RM625,000.

Meanwhile the SECOND best appreciation is actually the High Rise. yes, the one which people said, there’s too many so should not be appreciating much. It appreciated by an average of 134 percent. So, a typical unit in 2010 of RM250,000 would be RM585,000 in 2024. Of course, this is also because high-rise units are also cheaper, so the percentage could be bigger but amount wise could be smaller.

The 3rd would be the semi-detached. (This is where you have a neighbors home on one side while the other side is a patch of your garden). For the semi-detached, the appreciation was 79 percent. This meant that a RM500,000 priced home would be RM895,000 today. The starting price is higher lah, semi-detached not that cheap. So, the actual amount is bigger but the percentage is smaller.

Last placed would be detached. This would be your typical bungalow. The price has moved throughout the years and was up as much as 83 percent but as at 2024, the price has increased by just 8 percent. This is average number because for some areas, maybe people are buying that bungalow for the piece of land so that they could rebuild too. Another reason is also when it comes to a detached unit, chances are the new buyer would not like the design, so they will not be willing to pay very high for it as they only wanted to demolish it and rebuild.

My assessment

We just need to remember that average increase or decrease does not mean every property transactions is the same. This is why some people are happily selling their place for very good profits while some people are struggling to even get viewings from potential buyers even after they have reduced their selling price to attract potential ones. However, if we look at an overall market basis, property prices will always show an increasing average trend because sellers usually have a higher bargaining point. Why do I say so?

Generally, property prices increase because there is not enough supply to cater to the demand. Imagine Area A having 100 units of supply and total demand for these units is just 80 units. Do we believe the price would move upwards? Briefly, no. Maybe it would go lower too. However, this situation does not necessary be the same for Area B, Area C and so on… Some areas receive by far more interest and demand would be far higher than the available supply of units. When this happens, the available units would naturally go to the people willing to pay the highest.

Just ask a few of your good friends to name a few areas they like. Most of the names stated would duplicate. This is why demand are far higher for these areas. It will thus push up the price and the price would move so far up that people have no choice but to consider some other cheaper alternatives. This is how prices in surrounding areas also start to increase once the most popular ones become out of reach in price. Hope this explains better.

So, the question of whether landed or high rise will increase in price does not matter. If landed increase so much that people could not afford, they will just go to high rise. This will then also push up the high rise prices too. Cheers.

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