Flats, condominiums, and serviced residences in Malaysia might look the same from the surface but did you know that they have varying differences?
Serviced residences are also known as serviced apartments and serviced suites. But despite the different naming conventions, they are essentially the same.
So, what is the meaning of serviced residences essentially?
What is a serviced residence?
Serviced residences are convenient apartment lots that are often fully furnished, equipped with hotel-like facilities and housekeeping services.
Also known as serviced apartments and serviced suites in Malaysia, serviced residences are usually in areas where essential amenities are only a stone’s throw away.
Although they have been increasingly popular for long-term accommodation over the years, these high-rise serviced residential apartments are mostly targeted for short-term stays in the city.
The difference between serviced residence and a condominium?
There are several main differences between a service residence and a condominium, which can be summarised into 3 points:
- Higher utility and maintenance fees
The main difference between a service residence and a condominium is that serviced apartments carry a commercial title, whereas condominiums carry a residential title.
How does this affect me? As high-rise serviced apartments sit on commercial land, you will be expected to pay more for utility and maintenance fees, assessment fees, and entertainment fees for Internet and cable TV.
The exact costs vary depending on location and the nature of the apartment, so be sure to do a comparison between your preferred residences, if you wish to own one.
- Strategic location and amenities
Condominiums are developed specifically with long-term residents in mind, instead of short-term guests. So, condos are usually well-equipped with facilities like a pool, gym, sports courts, security and bigger parking lots.
Serviced residences, on the other hand, are built with short-term guests in mind. With more space to live in as compared to a hotel suite, it’s usually strategically located with public amenities and hot spots within arm’s reach.
- HDA protected
Good news! Since serviced residences carry the commercial title, they are protected under the Housing Development Act (HDA). This means that developers are allowed to advertise and rent out their apartment lots freely, upon obtaining the Advertising Permit and Developer’s License (APDL).
This also applies to the other types of commercial serviced units like Small Office / Home Office (SoHos), Small Office / Flexible Office (SoFos) and Small Office / Virtual Office (SoVos). Targeted towards younger millennials, couples or young families looking to start their home-ownership journey.
Is Serviced Residence a Good Investment?
You might be wondering if investing in a serviced residence would make a good ROI? Here are three questions to ask yourself to gauge if serviced residences are the best investments for you:
- Objectives of investment
It’s a good start to list out your motives behind investing in a serviced apartment. Serviced apartments have a range of unique selling points, a strategic location, being fully furnished to being equipped with great amenities, it’s no surprise that this has become a popular option if you’re looking to rent out your properties.
- Usage of space
There are multiple types of service apartments, from studios to SoFos to 3-bed suites. Depending on your needs, pick one that suits your lifestyle, family size and what is important to you.
Tip: Make a list of what your must-haves are and what your deal breakers are. This will help you put your needs and wants into perspective, and help you make the right decision.
Rental Rates for Serviced Residence
An average rental cost for a fully-furnished serviced apartment in Malaysia within the city is about RM2,400 per month. This may include an array of basic facilities and services.
If you own a high-end serviced residence in the heart of the city, rental prices can go up to over RM10,000 per month for a fully-furnished 3-bedroom suite.
Overall, serviced apartments are great options to consider if you’re looking to rent out or you prefer to live in a strategic location with all the amenities you need within arm’s reach. Here are some great options if you’re looking to rent a serviced apartment as your own residence.