Updated: KL High End Condo Market -A Dead Cat Bounce?
Knight Frank Malaysia's 2H 2021 report “Malaysia Real Estate Highlights” says the Kuala Lumpur high end condominium market will cautiously bounce back and stage a gradual recovery throughout 2022.
Well, I'm keeping my fingers crossed KF Malaysia is right the high end KL condominium market will bounce back. But a nagging thought crossed my mind- is it going to be a Dead Cat Bounce? You see, my perennially upbeat auctions property agent “J” keeps on sending WhatsApp messages, like:
“Only RM616 psf for two units at Mercu Summer Suites. 3 minutes to SURIA KLCC. 4 minutes walk to a monorail station. Tenanted. Can get immediate income. Auction date finalised: March 2022”.
According to EdgeProp Analytics, Mercu Summer Suites has a median price psf of around RM1,000. See here.
Even if property developers can shift inventory, the RM64m question is who is going to rent KLCC condos? Where yours truly is currently based - in Penang-the occupancy for High End Condominiums, even for prime luxury apartments with unblocked seafront views is low. For example, I see 1100sf full sea view units renting for @RM3000pm still empty after more than 6 months. The impact on the F&B , tourism and hospitality sectors which employ many people can be felt and seen: in many restaurants when I dined out recently at lunch or dinner, I find I have the whole place to myself.
In KL, a dwindling expat tenant pool, no clear announcement when (fully vaccinated) international travellers will be allowed in, and Ringgit concerns will still dampen property sentiment towards the High End property market.
That's my Dua Sen, folks.🤠👌
Notes & Disclaimer
A Dead Cat Bounce is explained here . I am not a registered agent. If you are thinking about buying an investment property please consider contacting a BOVEA registered valuer or real estate agent for advice.
From 1 April, Malaysia is opening its borders to fully vaccinated international travellers. On 16 March the first VTL flight from Singapore to Penang landed at Penang International Airport
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