News: KL Luxury Home Prices Plunged in 2017

Feb 13, 2018

 
Prices of upscale residential properties at prime areas in Kuala Lumpur City Centre (KLCC) have declined significantly last year, according to property consultancy Rahim & Co.

According to its Executive Chairman Tan Sri Abdul Rahim Abdul Rahman, prices of luxury houses in the area stood at about RM2,500 psf three years ago.

“However, prices have now gone down to below RM2,000 psf. I think generally the prices of high-end houses range from about RM1,500 psf,” he said during the launch of his firm’s latest Property Market Review on Monday (12 February).

“People will not pay higher than say RM1,800 psf but developers will not bring the prices to any lower than RM1,300 psf. Depending on the type of development and facilities, that’s the price range. So no more the RM2,000 to RM2,500 psf, which we had three years ago.”

This means, some high-end residences in KLCC suffered negative compound annual growth rates (CAGR) between 2015 and 2017.

For instance, average transaction prices at One KL fell last year to RM1,093 psf, translating to CAGR drop of 9.2 percent, while that in Quadro Residences fell 2.9 percent to RM1,174 psf.

For The Troika, average prices dropped 3.7 percent to RM1,230 psf. That in St Mary Residences dipped 5.1 percent to RM1,237 psf, whereas that in Pavilion Residences slid 6.7 percent to RM1,582 psf last year.

On the other hand, prices in other upscale homes posted positive CAGR. That in Vipod Suites rose 0.5 percent to RM1,638 psf, while that in ParkView Serviced Apartments edged up by 1.8 percent to RM1,106 psf.

Prices in The Meritz, Marc Serviced Residences and The Horizon Residences respectively posted gains of 2.3 percent, 2.6 percent and 5.2 percent to RM1,011 psf, RM1,536 psf and RM1,512 psf respectively.

Meanwhile, Rahim & Co’s Director Robert Ang said the federal government’s ban on new luxury properties will disrupt businesses. He believes that builders should be permitted to undertake projects as long they have sufficient funds. If they intend to loan the amount, the lender must thoroughly scrutinise the borrower and the feasibility studies for the proposed project.

“When you freeze and subsequently they announced there’s going to be selective freezing, so that opens up a lot of questions. I think what they should have done is they should have employed other measures and impose on banks to have more stringent feasibility studies.”
 

Image sourced from Malay Mail

 
This article was edited by the editorial team of PropertyGuru. To contact them about this or other stories email editorialteam@propertyguru.com.my
 

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Shaiful Safar
Real Estate Negotiator
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True Vest Property Consultants Sdn. Bhd.
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