Malaysia Property Market Analysis for 2007

The key issues raised consistently when undertaking research for the Amberlamb ‘Malaysia property market analysis for 2007’ report were that there is enormous potential for growth in Malaysia with the commercial market potentially outstripping the residential in terms of instant attraction in 2007, but that an investor in residential real estate really needs to pick their properties carefully if they are to see any short term appreciation.

Over the medium term Malaysia property is seen as an exceptional choice for international investors because, in the words of one of the largest real estate companies in Asia, Malaysia’s real estate industry has “tremendous growth potential.” Added to this are positives such as the fact that the Malaysian currency is cheap when compared to the US dollar, Euro or British pound and international buyers can get so much more for their real estate money in Malaysia.

In April 2006 the Malaysian Government introduced their ninth Malaysia Plan (9MP) which is a blueprint for economic development and budget allocation from 2006 - 2010.  9MP has many provisions for infrastructure improvement and general economic diversification and development that will positively affect the real estate market across the country.  In the wake of the announcement of 9MP Singapore based CapitaLand partnered with Maybank a leading local lender in Malaysia, to issue one of CapitaLand’s largest closed end private equity funds which will directly and hungrily target a diverse portfolio of real estate across Malaysia.

The fund is predicted to have a gross development value in the region of a billion dollars and the commitment is being seen by many as providing the property market in Malaysia with the positive promotion it needs for a period of rapid expansion.

However, certain doom-mongers are overly concerned with an excess of supply of certain residential stock mainly in Kuala Lumpur…but as all analysts we spoke to advised, those seeking short term movements from residential stock have to pick their properties very carefully in 2007.  Sunrise Berhad and YNH Property Berhad were big names to consider as far as all were concerned with a number of local analysts also suggesting investors look at what’s on offer from IGB Corp Berhad and Plenitude Berhad as well.

In very real terms many overseas buyers can get so much more for their property pound, dollar or euro because the Malaysian ringgit is so cheap in comparison and because the price of real estate per square meter even in Kuala Lumpur is a fraction of the cost of property in London or New York.  In terms of who an investor can market their properties to – well in Kuala Lumpur there is such an active flow of expatriate tenants and in some of the more popular coastal resorts it has been reported that wealthy Japanese and Indian buyers are hungry for quality stock.  Basically an investor has a diverse market to target with either rental stock or resales on the residential side of things with demand for medium and quality stock quite high.

On the commercial side of things, again CapitaLand are leading the way into 2007.  They have snapped up retail and office space as well as mixed use developments such as One Mont’ Kiara which has retail, office and car parking – basically the market options are broad and prices in 2007 are going to be attractive and anyone wanting to avoid direct market exposure to property in Malaysia has a range of REITs and equity funds to choose from.

Special Reports: Property News for Malaysia

Malaysia Property Buyer’s Country Guide
Luxury real estate developments across Malaysia are attracting international interest from property buyers attracted to the scope in the market.

Malaysia Property Buying Process
The Malaysia property buying process is relatively straightforward, but raising local finance to buy Malaysian real estate is time consuming

Malaysia Property Investment Potential
Property investment opportunities in Malaysia offer strong rental yield potential and real estate investors draw confidence from Malaysia's strong economy