By Adlene Hanna
It is difficult to accurately project the returns of a property investment. The property market is heavily dependent on the economy, so a significant shake-up like a pandemic is bound to leave its mark.
It could be assumed that asking prices are lower than usual and, therefore, it is a bad time to sell. Property Advisor’s database, however, reveals that the median transaction prices actually vary from area to area.
Some investors and homeowners have been pleasantly surprised to find the value of their properties has increased since the pandemic began.
Here are the two top areas in Johor that saw a positive growth in the median price of property transactions last year.
1. Pasir Gudang
This industrial area is home to the Pasir Gudang Industrial Park and Tanjung Langat Heavy Industrial Estate.
With a focus on heavy industries such as transportation and petrochemicals, it has a constant demand in its rental market for factory workers. This makes Pasir Gudang a good area to invest in for those looking to make money through rentals.
Breaking down the transactions according to buyer segment, sales in Pasir Gudang last year were hugely dominated by investors, coming in at 92% of overall transactions.
In fact, investor transactions rose by 50.9% last year compared with 2019, and saw a significant increase in the median price of investor transactions by 25%.
First Home Buyer (FHB) transactions nosedived by 90.36%, while the median price fell by 9.12%.
Overall, total transactions in Pasir Gudang dropped by 30.5%, while the median price increased by 11.11%.
Mersing is best known as the interchange point to islands surrounding Johor thanks to its passenger boat jetty. You can also take a calming walk along the beach and have a good seafood meal.
Not surprisingly, the median price of transactions increased by 53.13% last year compared with 2019, despite an overall transaction drop of 27.27%.
Investors remained confident in Mersing’s potential with a small dip of 7.14% compared with the previous year. They were also willing to spend more, which is reflected in the median price increase of 53.49%.
FHB transactions, on the other hand, decreased by 42.11%, while the median price fell by 35.71%.
On closer inspection, investor transactions made up 54.17% of the total transactions carried out last year.
If you own property in either of these areas, it might be a good time for cash-out refinancing if you are in need of extra cash flow.
Start by finding out the current value of your property using Property Advisor’s Refinance Calculator.