Buying properties near major airports like KLIA or klia2 could offer deep, long term value.
It was not long ago that buying property near an airport used to be considered a risky investment move. After all, who wants planes flying over your roof in the middle of the night?
“Nobody will rent your house, it’s in the middle of nowhere.”
“Your property price will go down before you even get your house keys!”
These would have been some of the typical over-reactions. While some of these perceptions were true 20 years ago, not many realised that properties near airports – in a competitive market – have become an untapped goldmine.
It’s mind-boggling to see buyers flock to launches of new property projects near airports. Are these buyers privy to market information not available to the average Joe investors and the general public?
Here’s what these savvy buyers know about investing in a property near an airport:
1. Malaysia’s aviation industry is on an upward trend
Numbers don’t lie. Malaysian airports have become money-spinning behemoths.
It is a known fact that aviation is a key driver of global economic development. It provides the only worldwide transportation network, which plays a vital role in facilitating economic growth, particularly in developing countries.
According to data from the operator of KLIA and klia2 Malaysia Airports Holdings Berhad in the first nine months of 2019 (9M19) KLIA recorded a 3.3% growth in passenger traffic to 46.2 million passengers.
With solid revenue and passenger growth, MAHB’s Malaysian operations posted earnings before interest, taxes, depreciation and amortisation (EBITDA) of RM1.05 billion. This shows that Malaysia’s aviation industry is on an upward trend with the Asia Pacific expected to be the fastest-growing region for demand and capacity.
Furthermore, KLIA Aeropolis – which is expected to commence operation in the third quarter of this year – will elevate Malaysia as a magnet for foreign direct investments and as a high-income nation. Its air cargo and logistics development cluster alone is projected to generate RM1.6 billion in GDP and create 6,000 jobs in the next three years.
Which property developer or investor wouldn’t want a slice of this action?
2. Affordable prices, excellent value
The median transaction price of all types of property within a 20-minute drive of KLIA or klia2 recorded a steady year-over-year increment from 2015 to 2019, as shown in the table below:
Of course, you could easily go up the price ladder and find premium units near airports that are above RM1 million.
For the same price you fork out for a property in the city centre, you’d be paying for much larger units in KLIA proximity. This shows that there are good deals to be had for property near airports.
This price range would make it ideal for investors looking to rent out their units, for example to students or airport workers. Its proximity to a variety of airport-related facilities and amenities would also add value to the property. You can check out our article, ‘Sepang: The emerging property investment hotspot in 2020′ with supporting data that delves into the details of Sepang’s potential for property investors.
Start your engines, bargain hunters!
DISCLAIMER: The source of Sale data is from the Valuation and Property Services Department (JPPH) which officially records a property transaction once the stamp duty for the Sales and Purchase Agreement is paid while the source of rent data is from agents’ listings listed at iProperty.com. Analytics are based on the data available at the date of publication and may be subject to revision as and when more data becomes available.
3. Airplane noise is not an issue anymore
Although excessive and frequent noise used to be a major deterrent in buying properties near airports, this is no longer the case. As long as a residential neighborhood does not fall within an airport’s flight path, noise should be the least of your worry.
Setia Warisan Tropika that’s located merely 10 minutes’ away from KLIA is an example of how a residential neighbourhood can sit within proximity of an airport without experiencing noise disturbance.
Plus, with technological advances and worldwide efforts in lowering noise pollution, this could soon become a non-issue for residents living near airports. Future airports could be as silent as libraries!
4. KLIA future expansion
KLIA and klia2 have a combined capacity of 75 million passengers and handled 59 million passengers last year. The 20-year old KLIA Main Terminal alone is already nearing its capacity of 30 mppa (million passengers per annum).
While plans to construct a third airport in KLIA within five years was just hearsay, the government is already thinking ahead with plans to upgrade and expand this terminal so that it can add further capacity of between 15 to 20 million more passengers.
This expansion plans of Malaysian airport that is expected to be completed within the next five years have become a crucial element in the country’s infrastructure and economic growth.
For property and airport lovers, this is a mouth-watering prospect!
5. Surrounding Universities creating investment opportunities
Let’s not forget that there are three prominent education hubs in the airports’ vicinity: INTI College Nilai, Xiamen University Malaysia, and Nilai University. The investors are flocking to airports with proximity to universities to protect themselves from price volatility, particularly those who intend to rent them to students. Since students generally could not afford to rent a one-bedroom or a whole house, property intended for student rental should have a minimum of two-bedroom.
Taking these factors into consideration, it makes sense to invest in a property in an area where prices are still affordable.
Thinking of buying a property within vicinity of KLIA or klia2?
You can consider Setia Warisan Tropika by SP Setia, a beautiful tropical resort township that is being launched at affordable prices. Located in Salak Tinggi, Sepang, it is an excellent choice for those working in KLIA, Putrajaya, Cyberjaya, Nilai, Seremban, Sepang, Puchong and KL Sentral 2.
Built within a secure, master planned township, Setia Warisan Tropika is also conveniently accessible via major highways such as MEX, LDP, SKV4, SILK, ELITE, Putrajaya-Cyberjaya Expressway, North-South Highway, KLIA Expressway, Jalan Bangi-Dengkil, Jalan Dengkil-Bintang and Nilai-KLIA Expressway.
It includes 8 tropical-themed gardens and a waterscape! Choose from conventional or flexi-layout options (garden view or water canal) that offer more room and space to suit your living needs.
For more details about this distinctive tropical township, you can read our review on Setia Warisan Tropika or check out Setia Warisan Tropika’s Page. To experience living in one of these properties, check out Setia Warisan Tropika gallery at No. 41, Jalan Warisan Sentral 1, Kota Warisan, Sepang (opening times: 9am-6pm (Monday-Friday), 10am-6pm (Saturday, Sunday & public holidays).