Version: CN
The contents of this article were contributed by Justin Low, seasoned property professional with 6 years of experience specializing in Ipoh, Perak.
Perak, the second largest state in Peninsular Malaysia has shown a booming property market in recent years.
With the rise of Eco Tourism Perak, more and more tourists are flocking to Ipoh and its counterparts to indulge in beautiful scenery and take a break from city chaos.
If you’re looking for a comfortable retirement destination, or are a potential investor looking for side income, Perak might just be the place to be.
Read on for insights on the Perak property market!
Malaysia Property Market: Insights on Perak
1. Who is buying property in Perak? Understanding the ‘Why’
Perak Locals
Naturally, local residents make up most of Perak’s real estate market, but for a specific reason: many of these residents have ancestral homes passed down through generations.
However, the need for more space and improved living conditions due to an increase of family members drives them to consider purchasing new properties.
This trend is particularly noticeable during significant times such as Chinese New Year or other public holidays, when the desire for a comfortable space becomes more prominent.
Justin Low, team leader of IQI Elite Bricksmen and Perak real estate professional, notes that these occasions often prompt families to upgrade their living situations.
They seek homes with better infrastructure and more room to accommodate their growing families, ultimately giving them better quality of life for both the children and the elderly.
Out-of-State Investors
Besides Perak locals, investors from other states are interested in Perak primarily due to the potential for returns on investment.
These investors purchase properties with the intention of converting them into homestays to attract tourists, thereby generating a steady rental income.
Additionally, Perak’s slower-paced lifestyle offers a stark contrast to the hustle and bustle of cities like Kuala Lumpur. Many out-of-state investors are drawn to the idea of enjoying their retirement in a more relaxed environment.
The appeal is further enhanced by Perak’s lower cost of living. Food and general expenses are more affordable, making it an attractive option for those seeking a comfortable yet cost-effective retirement.
Out-of-state investors see the potential in securing properties now, either for their own future use or as part of their investment portfolio aimed at the retirement market.
2. Perak Buyer Demographics: Who’s Buying What
Perak’s different types of housing options attract varying kinds of buyers. The distinct pattern can be summarized into the two major age groups, as follows:
Younger buyers prefer high-rise homes
Young people in Perak show a strong preference for apartments and high-rise living. Influenced by the modern homes in Kuala Lumpur, they are drawn to stylish designs and comprehensive facilities.
These buyers value the convenience and amenities that high-rise properties offer, making them a popular choice among young adults.
Older buyers prefer landed homes
In contrast, older residents tend to favor more traditional, landed houses. Single-storey terrace houses are more practical and comfortable for this age group, particularly because they are easier to navigate.
This preference for landed houses stems from a desire for practicality and ease of movement, as stairs can pose challenges for the elderly.
3. Strategic Location: A Hotspot for Interstate Commuters
Perak’s strategic location between Penang and Kuala Lumpur makes it an ideal choice for those travelling across states for work.
According to Justin, some property buyers in Perak are interstate commuters. Residents of Penang often travel to Kuala Lumpur for work, and vice versa.
To reduce fatigue of long drives, many commuters find a house in Perak as the best place to rest in between.
Properties near toll highways are particularly popular, as these routes connect Perak, Penang, and Kuala Lumpur, making commuting more convenient.
Investors have recognized this advantage and are capitalizing on it as an investment opportunity by renting out B&Bs to these interstate commuters.
4. Should You Invest in Perak Property?
Perak’s tourism industry, with the help of the Eco Tourism Perak campaign, has thrived in recent years, the average monthly hotel occupancy rate reaching an impressive 70%.
During holidays, hotels are often fully booked.
Despite these high occupancy rates, there are relatively few homestay options in Perak, resulting in less competition in the market.
This presents a golden opportunity for potential investors to capitalize on the growing demand for accommodations.
The investment environment for homestays in Perak is more favorable than in larger cities like Kuala Lumpur.
While Kuala Lumpur’s thriving economy makes it an attractive investment location, the oversupply of homestays means tenants have many choices, making it difficult for individual properties to stand out.
Justin Low, real estate agent
In contrast, Perak, especially Ipoh, has fewer competitors in the homestay market and still enjoys high occupancy rates.
On weekdays, the average nightly rental for a homestay is RM250, rising to RM350 to RM400 on weekends.
For those looking to invest in a homestay in Perak, small apartments are a good choice. These units are easy to maintain and relatively low-priced.
By adding unique features to the homestay, investors can attract more tourists and achieve substantial rental returns.
5. Increasing Home Prices Bring Higher Potential for Returns on Perak Homes
From an investment perspective, high-rise properties often seem more attractive. However, the value of low-rise land properties in Perak should not be underestimated.
In recent years, the prices of landed houses in Perak have been soaring. For example, five years ago, a double-storey terrace house cost RM400,000; today, it has risen to RM600,000.
This substantial increase in value over a relatively short period highlights the strong investment potential of these properties.
Moreover, as a neighboring state to Penang and Kuala Lumpur, Perak offers more affordable landed home prices.
The highest price for a double-storey landed house in Perak with a good location is around RM700,000.
In contrast, similar properties in Kuala Lumpur or Penang can easily exceed a million ringgit.
Given the rapid increase in house prices in Perak, it is likely that in a few years, prices could rival those in Kuala Lumpur or Penang.
Currently, the housing market in Perak remains stable and is expected to continue its positive trend.
If you are planning to buy property in Perak, now is the time to act.
Justin Low is a seasoned real estate agent with 6 years of industry experience focusing on Ipoh, Perak. Team Leader of IQI Elite Bricksmen, his outstanding performance led him to win several awards such as the Top Project Performer Award for Perak region in June 2024.
Leverage on the potential of high returns on investment or a future home for retirement in Perak! If you’re on the lookout to buying property, let our experts help you in your purchasing journey.
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