During the economic downturn, the landlord and tenant rental expectation gap narrow down

 

In the first five months of 2020, the residential property rent expectations gap between landlord and tenant of the Klang valley has narrowed significantly, the difference in rent expectations gap is now hovering between 1% to 9%, indicating that the owners’ rent asking price is more pragmatic.

According to the End to End property Property rent.buy and sell platform SPEEDHOME transaction data, over the past 5 months show that the homeowner/tenant rent expectation gap in Cyberjaya is the highest, and the rent required by the homeowner is 9% higher than the final transaction price that the tenant is willing to pay. Homeowners in Cyberjaya have high expectations for recent prices, mainly because the types of houses in the area are mostly fully furnished, to attract tenants who are mainly foreign students/expats, and the rental price gap has not changed much from last year.

Kajang ranks second. The ideal rental price of homeowners is about 8% less than that of tenants final offer price. Kajang is far from the city center. Therefore, the rental demand is not as high as that near the city center. However, the rent price expectation gap of homeowners is also 15% higher than last year. The gap narrowed to 8.3% because both parties were more willing to make concessions on prices.

Although Serdang (Seri Kembangan)  there are many avenues nearby and convenient transportation links, the Putra University is located in this area, but Serdang is more attractive to home buyers than the tenant. In the first five months of 2020, the price expectations of local homeowners have also shrunk significantly, only a 5.2% difference from tenants, compared with 12.3% last year, which can be said to be a substantial reduction.

The rental data shared by SPEEDHOME is mainly based on low to middle priced properties rental, and the property rental price is between RM1000 and RM2100.The price comparison reflects the supply and demand situation of Klang’s latest residential property rental market to a certain extent.

Expected more adjustments to the rental asking prices in the second half of the year

Wong Whei Meng,Chief Executive Officer of SPEEDHOME says that Malaysia’s high unemployment rate will definitely impact household incomes. It is predicted that there will be more adjustments to their rental asking prices, but there will not be a sharp decline, mainly due to the new launch of Klang in the past five years, property rent cannot cover the monthly mortgage of the house. Homeowners with strong holding power are willing to take more time waiting for suitable tenants.

It is predicted that tenants will be more sensitive to rents, but low to mid priced houses may not necessarily reduce rents, because homeowners have already rented out their units with lower monthly housing loans, and the room for rent reduction is quite limited. If the rent is lower than the current price, the owner prefers to leave the house vacant.

“The residential rental market in Malaysia in the second half of the year is still a tenant market. Tenants may be able to find their preferred accommodation at less than about 10%, but don’t expect that there will be a sharp decline in rents.”

 Source : SPEEDHOME

Disclaimer : The data only factors in the mid-tier property, ranging from RM1000 to RM2100 monthly rent residential property.

Leave a Reply

Your email address will not be published. Required fields are marked *