Rawang’s bestseller: Larger than average terrace homes

 

An aerial view of Rawang, taken on 24th September 2014. Image courtesy of Ho Chin Soon Research Sdn Bhd.

At RM287 PSF, many are taking advantage of Rawang’s low median per sq ft price to purchase bigger homes – 45% of secondary terrace homes sold within April 2016-March 2017 were in the range of 1,251 – 2,000 sq ft. 

Rawang’s housing market was in the spotlight earlier this month –  iPropertyiQ.com data (May 2016 – April 2017) revealed that Rawang’s terrace homes emerged as the sixth best residential product throughout Selangor in terms of year-on-year (Y-O-Y) secondary home sales, beating other renowned crowd favourites including Kajang, Shah Alam and Cheras.

Source: iPropertyiQ.com

To better understand Rawang’s housing landscape, we dug up latest transaction data from iPropertyiQ.com  – here, we will take a look at popular products and home buyers’ purchasing trends. Meanwhile, Charles Tan shares his brief analyses and insight into the area’s potential.

The terrace home category was the most popular product in Rawang garnering  561 transactions or 55.8% of the total secondary homes sales in Rawang (1,005) throughout the review period.

Source: iPropertyiQ.com

GUIDE

  • The review period is from April 2016 to March 2017
  • Terrace homes comprise of single, double and triple storey houses.
  • The data used to calculate asking median rent is obtained from iProperty.com Malaysia’s property listing database. Only monthly rents within the evaluation period are used to determine the median – this final figure is then used to calculate each area’s asking rental yields.

Key Figures for Top 5 Projects

Source: iPropertyiQ.com

Charles Tan, Founder of kopiandproperty.com

Taking into account the overall median PSF of RM287 and the top transacted PSFs, which range from RM231 – RM343, Rawang’s homes bear very attractive price tags.

Do note that there are quite a few areas located further away from the city centre with homes that are fetching a higher PSF. Granted, these residential boroughs are located on the other end of the Klang Valley conurbation, i.e in the southern part. Nevertheless, commute time to prominent neighbourhoods in the city centre would not greatly differ.

Performing a quick area-on-area comparison of terrace homes’ median PSF (Apr’16 – Mar’17)  using brickz.my data, the following is observed:

  • Semenyih: PSF of RM330 -15% higher than Rawang’s PSF
  • Kajang: PSF of RM350 – 22% higher than Rawang’s PSF
  • Bangi: PSF of RM350 – 22% higher than Rawang’s PSF
  • Seri Kembangan: PSF of RM409 – 42.5% higher than Rawang’s PSF

Considering the lower than average PSF, it is safe to say that most of the purchasers Rawang’s homes are owner-occupiers and not investors – these homes are coveted by families, as it offers spacious units at more affordable price points. The savings obtained can be invested instead into home renovations or even quality fixtures and fittings.

Of course, there is a trade-off – Rawang is still a developing neighbourhood, amenities and conveniences are not as extensive. The journey into the city centre might take an extra 12-15 minutes more and the closest public transport is not as easily accessible.

For instance, should you live in Bandar Tasik Puteri, the nearest rail stations MRT Sungai Buloh, Rawang KTM and The Kuang KTM are all a 25-minute drive away.

This is why single professionals would still prefer to purchase a high-rise unit closer to the city centre as space and a conducive environment is not as big a priority as ease of commute.

Spotlighting the best performer in Rawang, i.e Bandar Tasik Puteri,

  1. Transactions of sub-sale homes in Bandar Tasik Puteri dropped significantly (41.3%) most probably because a bulk of the purchasers are using them for own stay and not for investment or flipping purposes.
  2. Its rental yield figures (5.3%) and capital appreciation values (10.8%) are very promising, especially so in a slow market – in fact, the rental returns are 40% higher than current fixed deposit rates.

What did People Buy?

  Popular Built-Up Sizes (Sq Ft) 

Popular Price Ranges (RM)

Source: iPropertyiQ.com

The most popular built-up sizes were those between 1,251 to 1,500 sq ft and 1,501 and 2,000 sq ft. These 2 sizes alone accounted for almost half or 45% of total sales. The average KLite might gape at these ‘premium’ sizing, at a time where thousands are grappling with housing affordability and securing a home loan, the ability to purchase a 1,500 sq ft to 2,000 sq ft home in the Klang Valley for less than RM700,000 is impressive indeed.

Should you whip out your calculator, however, you will realise that a 1,500 sq ft home is actually very affordable when the PSF is ranging from RM231-RM343. Even when factoring the PSF at the high end of the spectrum (RM343), a 1,500 sq ft home would only cost you RM514,500, whereas a 2,000 sq ft unit still hovers below RM700,000, at RM 686,000.

Comparatively, a typical condominium with a 1,250 sq ft built-up located somewhere in between Rawang and the city centre will be within RM500,000-RM700,000, or even more. Whereas most high-rise units around the city centre in the lower-end of the price spectrum (RM400,000 to RM600,000) are typically much smaller, measuring between 700 to 900 sq ft.

Note: Population in 2010 (According to Census) = 198,000. Source:iPropertyiQ.com     

Looking at the population growth in Rawang, it is easy to see that people are moving into Rawang instead of moving out – there number of residents grew by 28,400 over the past 6 years or on average 4,733 per annum. Space will always be a premium, especially for family occupiers. Property search trends recorded between Apr’16 – Mar’17 further supports this notion, as shown below:

What Were Potential Purchasers Searching For?

Based on iProperty.com users’ search behaviours, terrace/link and townhouses garnered the highest interest – which proves that those who are looking to purchase into Rawang prioritize size or prefer a bigger space. These product types are also more affordable than semi-Ds or bungalows, hence why it is a clear favourite.

Future Outlook

In the next few years, Rawang will still be a secondary option for urban homebuyers as many prefer a more established residential address. However, Rawang has three important offerings in its arsenal – sizing, pricing and growth potential.

The population will continue to grow at a sustainable rate; in essence, the demand for homes and transaction activity will increase as well. Certainly, amenities would only follow and Rawang’s rise as a preferred residential neighbourhood among KLites is only going to happen sooner, if not later.

To put things into perspective, take a look at Mont Kiara’s landscape in the 1990s:

*Image courtesy of Ho Chin Soon, Chairman of Ho Chin Soon Research Sdn Bhd.

No one would have guessed that it would transform into one of the most prominent addresses in the Klang Valley two decades down the road. The same can be said for Desa Park City, which was once a quarry wasteland. Due to the stigma attached to its humble beginnings, KLites took some time to warm up to it; quite a few units remained unsold even upon the keys handover. Mention Desa Park City today, and people would tell you that is a prime neighbourhood, where the wealthy live!

Admittedly, Rawang will not evolve into a Mont Kiara or a Desa Park City in a few years’ time but as long as the Greater KL’s population expands, so will Rawang’s appeal continue to rise in ranks.

It is inevitable that the high affordability level for Rawang’s terrace homes will not remain constant for long  – in line with area maturity/development, the value of land is only going to creep up, resulting in more expensive price tags for the same product down the road. It will be tough for developers to continue constructing and selling at the same PSF in the next few years, hence we can expect to see more high-rise properties popping up in Rawang too.

A factor that works in favour in Rawang is the recent improvement in connectivity – the newly opened Rawang Bypass is a commute gamechanger. This highway is expected to reduce traffic congestion by 50% and shorten the Serendah-Selayang commute from 2 hours to just 30 minutes during peak hours.

Besides that, Emerald Rawang’s residents now have easier access to the Rawang toll plaza via the new Rawang East-West Link, which leads off to Jalan Batu Arang. Similarly, those who live in Rawang Saujana, Tasik Puteri and Taman Velox will enjoy the same benefit.

Aspiring homebuyers will have even more affordable options to choose from too; Amalan Setar (M) Sdn Bhd recently announced that it will be building a township Alamanda Parklands, offering landed homes starting from RM 299,800. These are in addition to ongoing township developments by KLK Land, Guocoland, Mah Sing and Sime Darby Property – an encouraging trend which will lend a hand towards boosting  Rawang’s vibrancy and livability.

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.
Share