Kuala Lumpur, 29th Nov 2021 – SPEEDHOME; Malaysia’s biggest Zero Deposit rental platform recently published a Klang Valley Rental Report on Supply and Demand for the first half of 2021. The report showed a narrowing rental expectation gap between landlord and tenant comparing the first half of 2021 to the same period last year.
SPEEDHOME CEO Whei Meng Wong said, “As the COVID-19 affects the rental property market, we have seen a decrease in the rental asking price by 2.25% as compared to the same period last year.” Wong continued saying, “thus why the rental expectation gap remains in a single-digit percentage, the first half of this year at 6.6%”.
Despite the narrowing rental expectation gap, the overall rental transaction median price saw an increase of 1.82% as compared to the same period last year. This is mainly contributed by an increase in transactions in popular areas such as Petaling Jaya, Brickfields and more.
Tenant Bargaining Power To Remain Strong and New Area Emerging
On the other hand, the report also revealed that tenant bargaining power remains strong in the first half of 2021 as more properties are expected to enter the market causing a flux in an already oversupplied market.
Apart from that, the report also revealed that despite being in a full Movement Control Order, the unique tenant rental request recorded a 2.31% positive growth. This number is expected to grow in line with the national recovery plan.
Amidst the changing market condition and environment, the report also shared new area demand emerging for Setia Alam. Wong shared that, “this is the first time in 3 years we are seeing an outskirt area emerge in our top 20 demand areas and demand is steadily increasing in the area as it continues to develop.”
Affordable Renting Driving Strong Demand
Aside from that, the top 3 demand areas continue to be occupied by mature areas with Petaling Jaya staying at the top of the list for the third consecutive year. With a price range of RM1,850 to RM2,200, the main factor driving the tenant demand in this area is established facilities, job opportunities, prime location and affordable renting.
Subsequently, Brickfields, Cyberjaya, Putrajaya and Setapak followed behind. While demands from students and young working adults looking for easy access to transportation driving the demand for Brickfields and Setapak, the demands for Cyberjaya and Putrajaya are driven by affordable renting and university students in the areas.
Lack of Demand Affecting Rental Price
While demands are steadily stabilising, we see the new emergence of areas with an oversupply of property in the market. Based on the rental report, the top 3 areas with oversupply are Bandar Tun Razak, Brickfields and Kepong.
While brickfields is also one of the areas with the highest demand among renters it also has a high supply of property. With more property entering the market soon, the area is expected to have an increase of supply that may not match the demand.
The report, which is drawn based on SPEEDHOME real-time data, analyses over 20,000 monthly tenant requests. The report also highlighted other insights and emerging trends of the rental property market crucial for tenants and landlords.
Lastly, Wong shared, “In the midst of the recovering economy we hope this report will help property investors to understand the current market better and to help tenants make better renting decisions.”
The report also highlighted the top 20 transaction areas and other crucial insights for property investors and renters. Want to read more? Read the rest of the insightful report below!