Property Development in PenangJune 26, 2020
With her vibrant environment and dynamic economy, the state of Penang is one of the most developed states in Malaysia. Having a density of more than 1700 people per square kilometer, it is a busy state with a flourishing economy.
For the past two decades, Penang has been a prime location for property investment in Malaysia. With delicious food and plenty of opportunities, Penang offers attractive qualities of life for residents. This, in turn, attracts the attention of many potential buyers that include locals and expatriates. Property development in Penang has always been related to one thing – land area.
In reality, Penang comprises of two major landmasses which are the Penang Island and Seberang Perai, a part of the Peninsular Malaysia mainland. However, new property development has been significantly skewed towards Penang Island instead where the capital city of Georgetown has been founded earlier than many countries in the world.
A mix of cosmopolitan modernity and heritage charms make Georgetown extremely appealing for investors. Both residential and commercial properties fetch sky-high prices in heritage areas. Shophouses in Georgetown are frequently acquired by investors to be converted into boutique hotels and cafes. However, prices of properties in Penang have also spiked significantly in the past decade. With limited land area but increasing demands, investors and property buyers are faced with a wall of price hikes.
The State Government of Penang has stepped in by introducing new housing rules in 2014. This rule dictates that low-cost and affordable housing in Penang cannot be sold within a specified number of years after purchase. This is to make sure that these developments are geared towards protecting buyers intending to purchase residential properties for own-stay purposes. Next, another key point is the base-limitation for properties being purchased by non-citizens. They can only purchase properties in excess of RM1,000,000 for strata-titled properties and RM2,000,000 for landed properties.
Examining the current state of property development in Penang, many are starting to commence projects in Seberang Perai. With land area supply critically low in Penang Island, Seberang Perai is now a potential goldmine as townships and commercial hubs are being planned and developed.
Significant landmark projects in the Perai area include the Design Village Outlet Mall, IKEA Batu Kawan and Elevate @ Gravitas. Landed properties on the Penang Island have also fetched extremely high prices, way out of league for most of the state’s working-class economy. Instead, Perai became the key focus development area with landed residential properties such as the Cresent Dew Lakehomes.
With no trends of slowing down anytime soon, development in Perai will quickly drive the local economy and drive lifestyle opportunities. To know more about UDA’s development projects in Seberang Perai, click here for more information!