“We prefer the Klang Valley and Penang over Iskandar”

The recent comments from Maybank Investment Bank’s research unit was heavily quoted in no less than 5 articles that I read online. It said “We prefer the Klang Valley and Penang over Iskandar.” Reasons stated? Oversupply due to huge incoming supply in a crowded development space and aggressive land banking activities by Chinese developers. All are valid reasons and if I have money to invest in one (1) property today, I can safely say that my first preference is also Klang Valley. It is however not for primary properties. I am more inclined towards secondary ones with aim solely for rental, even if the rental is only enough to breakeven with my mortgage.
The reason why I prefer Klang Valley over Iskandar is simple. Klang Valley remains the biggest contributor to Malaysian economy and this is unlikely to change anytime soon. Yes, many people said that there are lots of Malaysians working in Singapore but let me assure you that while this may be true, the number is nothing near to the migration to Klang Valley. I have worked for 15 years in Penang and even I have decided to make KL my home for the second half of my working life. Hopefully not until the retirement age. I would love for my family to be based in Ipoh instead. Staying with my parents would be my next goal.
Iskandar meanwhile is full of promise but without better connections between both countries as per my earlier writings, it will not be able to attract enough Singaporeans to relocate to Iskandar even if it’s a comparison between the clean HDB flats versus the comfortable condos in Iskandar. To those who kept harping on the new Vehicle Entry Fees, please get real. It is not likely that if I am a Malaysian or even a middle income Singaporean, I would be driving my car to and fro everyday. In fact, majority of middle income Singaporean does not own a car anyway. Now do you understand why I say connection is vital? Not just the High Speed Rail but also the extension of Singapore’s transportation connectivities into Iskandar.
So, perhaps it is true, for now I would stand on the side of Maybank Investment Bank until a much clearer connectivity plan is presented and acted upon. Yes, even if there are announcements, I think that tipping point would be the year that the connectivity opens. In other words, as soon as people could see how easy it is to travel between both sides, we would see a boom in demand. Okay, I have to admit, I am just a simple Malaysian. Perhaps my view is different from Singaporeans who has faster broadband connections and thus may read more than me. Happy deciding.
written on 18 Apr 2015
Next suggested article: Iskandar trending the Singapore property market? Prices Down 13.5%!