From Lau, a viewer who wrote in by email
Lau believes that because land is limited, a landed home in KL is almost guaranteed to appreciate over 20 to 30 years. Condos, on the other hand, age: however well managed, the building and facilities start to look old.
In a sought-after area such as Bukit Jalil, Hartamas or PJ, how would a condo's value hold up against a landed home over the long run?
“The moral of the story is it's very easy to look back.”
Landed terrace houses do appreciate fastest, but "guaranteed" is hindsight. Condos in good locations grow a little more slowly yet earn far more rent, and older landed homes without security face a ceiling on what buyers will pay.
Why
Landed wins on growth, condos win on rent
Official statistics rank landed terrace houses first for capital appreciation, with apartments close behind; corner lots do best of all. But a two- to three-bedroom condo in PJ rents for about RM2,500 to RM2,800, a rate tenants will not pay for a terrace, because condos offer security, facilities and less space to clean and maintain.
Yesterday's safe bet was once the fringe
Subang Jaya, PJ and Damansara Utama were on the edge of development 20 to 30 years ago, and people who bought early apartments in Mont Kiara, Hartamas or Puchong made money too. Townships launch terraces first because they sell easily; condos come later, once land is scarce.
Open landed homes hit a price ceiling
Individual-title terraces sit on public roads that often become shortcuts, and guarding them depends on a residents' association. A household paying RM1.2 to 1.5 million earns around RM18,000 to RM20,000 a month and expects security. Sean believes unguarded landed homes will hit a price cap, and notes many older owners downsize into 1,500 to 1,800 sq ft condos.
Big landed homes are hard to sell
Luxury homes bought for RM800,000 years ago are now listed at RM3 to 4 million and struggling to sell. On a RM3 million home, a buyer needs about RM300,000 down plus RM300,000 to RM400,000 for renovation before moving in, which only the top 5% or so of Malaysians can afford.
What to do
- Decide first whether you want capital growth or rental income; they point to different property types.
- If you buy landed, favour guarded or strata projects and avoid lots facing a main road or a likely shortcut.
- Look at today's early-stage townships, rather than chasing locations that have already made their money.
- Before buying a large landed home, ask who could afford to buy it from you in 20 years.
- Consider renting the dream home and putting your capital into rental apartments instead, as Sean suggests.
Editorial Note: Summarised from Sean Tan's full episode. The quoted answer is in his own words; the rest is our paraphrase. Figures reflect the recording date, so check current rates and rules before acting on them.
ASKING SEAN #241 | APARTMENT VS LANDED
Sources & Verification Data
Summarised from Sean's full English captions for Asking Sean #241. The quoted answer is verbatim; everything else is paraphrased. Rents and prices are as Sean stated them in February 2024.
