Goodbye 2018, Welcome 2019!

2018 property market roundups and outlook for 2019

Contributed by Khalil Adis


The 10th of May was a watershed moment in Malaysia as it marked the first change of government in the country’s history.

Since 1957, Malaysia was previously under the Barisan Nasional (BN) coalition, however, the high cost of living, falling Ringgit, the lack of affordable homes in the market, high unemployment rates among fresh graduates, the unfettered abuses of power, and the 1MDB scandal proved to be the undoing for the party as Malaysians far and wide cast their protest vote in the ballot box.

The message was clear – Malaysians have had enough and they want a new, clean government to lead the way.

With Pakatan Harapan now in power, all eyes are on the newly elected old Prime Minister Tun Mahathir Mohamad and his team to solve the pressing issues that have plagued the nation. Here are the top five property market roundups for 2018 and our top five outlooks for 2019.

Roundup of 2018

1. The demand-supply mismatch has resulted in an increasing number of unsold homes
According to Bank Negara, 80% of homes, or 146,196 units priced above RM250,000, remained unsold as of end March 2018 – a significant increase compared to 130,690 units during the same period last year. “Imbalances observed in the property market continue to persist”, Bank Negara had said in a statement.

2. The rent-to-own scheme being rolled out
In aiding first-time buyers to secure funding for their own homes, the private sector has come up with a few initiatives. Some private developers like Ayer Holdings have introduced a ‘Stay & Own’ scheme for their Epic Residence and Foreston projects – whereby portions of rental payments are converted into down-payments to enable renters to become property owners.

Initiatives like these do not only provide temporary solutions for those who urgently need homes but also provide a bit of security for those who want to buy a home but are currently unable to pay the necessary charges.

Meanwhile, Maybank has also rolled out a similar initiative called HouzKEY, dubbed as ‘a rent-to-own solution that helps you to own your dream home.’

This particular scheme involves zero percent down-payments with the monthly rental forming part of the home financing.

3. Ministry of Housing and Local Government (KPKT) studies Singapore’s Housing
In July of 2018, KPKT Minister Zuraida Kamaruddin paid an official visit to Singapore to study the Housing Development Board (HDB) model and replicate it in Malaysia.

Singapore has succeeded to build demand-driven homes, under its Build-to-Order (BTO) scheme, to house 80% of the Singaporean population.

This solution would be especially useful in Malaysia, where there is currently a demand-supply mismatch – as mentioned in point number one.

4. Malaysia is looking into having a single housing government agency
In Malaysia, there are so many affordable housing programmes being rolled out by the state and federal governments – such as Rumah Milik Mampu, Rumah Selangorku, PR1MA, My First Home, Program Perumaha Rakyat, and the list goes on. It confuses the public.

The government is currently looking into having a single agency to streamline the whole process – much like the HDB model. If implemented, this could help to solve the current Malaysian housing woes.

5. More help for the Bottom and Middle 40 percent (B40 and M40) and first-time homebuyers under Budget 2019
Measures include the Real Estate and Housing Developers’ Association (Rehda) agreement to cut prices by 10 per cent for new launches, the exemption of the Real Property Gains Tax (RPGT) for properties that are priced below RM200,000 and the stamp duty exemption for properties priced between RM300,000 and RM500,000, as well as those priced between RM300,000 to one million ringgit.

Outlook for 2019

1. Affordable homes to continue driving the market
There is currently a strong pent-up demand for affordable homes but the supply is lacking.

As such, the affordable home segment will continue to be in strong demand for next year.

However, there needs to be concerted efforts from both the government and private developers.

Under Budget 2019, the federal government has pledged to spend 1.5 billion ringgit on such homes via the 1Malaysia People’s Housing (PR1MA) scheme and Syarikat Perumahan Negara Bhd (SPNB).

2. South KL to be a growth area
There are many infrastructure projects and economic drivers that are in the pipeline and will further boost property prices in southern Kuala Lumpur.


One such project is Bandar Malaysia, which will serve as the terminus station for the Kuala Lumpur-Singapore High-Speed Rail (KL-Singapore HSR) project linking both cities in 90 minutes flat.

The development of the project has been postponed for two years and construction is scheduled to commence in 2020 instead of 2018.

Meanwhile, the express service will only commence by 1 January 2031 instead of 31 December 2026, as initially planned.

Bandar Malaysia is a site for the Digital Free Trade Zone (DFTZ) initiative by Jack Ma. Home to the Satellite Services Hub, the DFTZ is expected to create some 60,000 direct and indirect jobs.

Bandar Malaysia will also possibly serve as the interchange to the MRT Line 3, which has now been postponed.

Another economic driver in the vicinity is the Tun Razak Exchange (TRX). It will be a mixed-use development comprising Grade A office spaces as well as residential and commercial precincts.

To be developed in several phases over the course of 15 years, the first phase will comprise four grade A office towers, a lifestyle retail mall, two 5-star hotels, and up to six luxurious residential towers – with a target completion date by next year.

In addition, Bandar Malaysia will house two MRT stations – Bandar Malaysia North and Bandar Malaysia South – which will form part of the alignment for the Sungai Buloh – Serdang – Putrajaya Line (SSP Line).


3. Properties along the Sungai Buloh-Serdang-Putrajaya Line (SSP Line) will be heavily sought after

Speaking of the SSP Line, properties along the alignment – particularly those situated in the growth areas of Sungai Besi, Bandar Malaysia, and Cyberjaya City Centre – are worth looking into as opportunities.


Bandar Malaysia will house two MRT stations as stated above and located a few stops away from Tun Razak Exchange MRT station.

Meanwhile, Sungai Besi MRT station is an interchange station to the Sungai Besi LRT station. It will serve as an interchange to the upcoming High-Speed Rail station located in Bandar Malaysia, also in Sungai Besi.

Last but not least, Cyberjaya City Centre MRT station is a transit-oriented development (TOD) project to be developed by Malaysian Resources Corp Bhd (MRCB). With experience in building the transport hub in KL Sentral, MRCB will be developing a new city integrated with the MRT station. Phase one is expected to generate a gross development value (GDV) of RM5.35 billion. It will feature a 200,000 sq ft convention centre, a 300 to 400-room business hotel, low and high-rise office buildings as well as a retail podium.

Cyberjaya City Centre will have a development plan spanning 20 years. The MRT station is located just opposite Lim Kok Wing University of Creative Technology.


4. Penang to get a boost from Phase 1 of the Penang Transport Master Plan (PTMP)

With Lim Guan Eng as Malaysia’s Finance Minister, Penang’s property market will get a further boost. Just this month, Phase 1 of PTMP was approved.


It will comprise the Bayan Lepas Light Rail Transit (LRT) project, Pan Island Link 1 (PIL1) project, and several main highways.

The proposed Bayan Lepas LRT line will be about 30 kilometres in length, with 27 stations running from KOMTAR to the future reclaimed islands in the south.

There will be three interchange stations – KOMTAR, Sky Cab Station linking it to the Sky Cab line across the Malacca Straits, and The Light Station connecting to the George Town-Butterworth LRT line.

The LRT Line will also converge with the Sungai Nibong Express Bus Terminal at the Sungai Nibong Station.

Meanwhile, PIL1 is a new 20-kilometre highway that will be aligned along the mountainous terrain of the island and reduce the journey between Gurney Drive and the Second Bridge to around 15 minutes.

There will be six interchanges in all – the Dr Lim Chong Eu Expressway (LCE), Awang, Relau, Paya Terubong, Utama, and Gurney.


5. Johor Bahru to get a boost from the Rapid Transit System (RTS) Link

Meanwhile, over in the southern state of Johor, Iskandar Malaysia’s property market will get a boost as the RTS Link will commence construction next year.


The RTS Link will link Bukit Chagar station in Johor Bahru to Woodlands North MRT station in Singapore when completed in 2024.

There are also plans for a Bus Rapid Transit (BRT) system within Bukit Chagar station to link it to the different areas of Iskandar Malaysia.

The BRT will feature a dedicated bus lane with three lines – BRT Line 1 will span from Bukit Chagar to Tebrau, BRT Line 2 from Bukit Chagar to Senai, and finally, BRT Line 3 from Bukit Chagar to Iskandar Puteri.

However, based on market talk on the ground, there is a possibility that the BRT system will be upgraded to an LRT system instead.


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