“Are Properties Near MRT Stations Worth More?” Part 1/3
Public Transport Myths?
EdgeProp has a new tool to help property buyers interested in buying properties near MRT stations. Its Location Scan tool will display a myriad of information on properties within the vicinity of a MTR station with just a simple search. See picture below.
But I think it's a myth that the announcement MTR stations being built near your condo are going to immediately boost its value. Why?
In 2017, a coffee table sized book by Cha-Ky Koh of Urbanmetry with the tantalising title , "The Secret Atlas Of Greater KL" , page 67 hit the bookshelfs at Times book store in KL. I bought a copy at the Pavilion branch which sadly has moved out. On page 67 with the section title, “Public Transport Myths” the book says two main myths persist :
Myth #1 : Everyone pays premium for homes near an MRT or LRT station.
Myth #2 : Prices of homes will immediately increase when train stations are announced.
Urbanmetry's radial histograms to compare price premiums for homes located close to stations and those close to incomplete stations show the price premium for homes within 500m of completed stations is 1%. For incomplete stations within 500 m, there was a discount of 6% perhaps because prices are temporarily dampened by noise and traffic congestion during the construction period. See below.
Copyright by EdgeProp
In my opinion comparisons to densely packed Hong Kong and Red Dot Island where there are indeed price premiums for homes within walking distance to MTR stations are quite disingenuous. In Hong Kong, there is an efficient network of mini buses and buses that link MTR stations to housing estates. While in Red Dot Island there is tight integration of townships where MTR stations are purposefully sited next to bus hubs serving the “First Mile Last Mile” connection to HDB public housing estates.
You see the main problem with monorail, MTR and LRT stations in Bolehland is poor FMLM connectivity - many stations are underserved by reliable feeder bus services. I use to rent an apartment next to the Bukit Nanas monorail station in 2017. The monorail network was supposed to get commuters across the city quickly. But delays in its 20 minutes interval monorail service were notoriosly common.
Another problem is that in MTR 1, many stations were suboptimally located near areas where the poorest 40% stay. And most MRT stations are not really located at highly populated area that would likely serve the right commuters.
According to “The MRT Report: The Affordability of Homes Surrounding MRT Stations”, which was compiled by the Centre For Governance and Political Studies, a Kuala Lumpur (KL)-based behavioural and social science research firm, most of the existing stations were built in unsuitable areas.
“Based on our findings, only eight of the 31 stations for MRT Line 1 were built at locations within a kilometre radius of properties that are meant for the M40 (middle income 40%) group,” the firm’s head researcher Zaidel Baharuddin said.
Post Script
Urbanmetry has announced a product called NowCast that it claims predicts property prices for home buyers. Currently I believe but cannot be 100% sure Nowcast is being trialled at some banks. Home buyers taking mortgages can ask for the Nowcast service.
Wouldn't it be great if some research analysts got hold of Urbanmetry's Nowcast software and in conjunction with EdgeProp 's Location Scan use it to predict which properties near MTR3 stations have the greatest price appreciation potential?😜
Copyright by Cha-Ly Koh
