By Vigneswar Rajasurian
Due to the pandemic, many businesses have switched to a work-from-home model. Consequently, space and privacy have become more pressing issues for residents of high-rise units, while investors are facing disruptions in rental income as pay cuts and job losses affect the population.
The dual-key concept seems to be a win-win scenario for property developers, investors and homeowners.
While dual-key layouts have existed for decades in the west, the concept emerged in Malaysia only a decade ago, but has picked up greater traction in recent years as property developers adapted to the challenges of an oddly shaped piece of land, or limited plot ratios that determine the density of a building.
Dual-key condos are a solution that essentially offers the homeowner two units under one title, providing added flexibility on how the property is used.
These configurations in Malaysia typically share a common foyer; for example, as opposed to a three-bedroom layout, a dual-key condo might feature a two-bedroom unit and a studio connected by a shared entrance.
Other configurations with shared kitchens or living spaces are also available, depending on the developer.
Residents of dual-key condos can use the attached unit as a home office. It is also useful for family members who would like a little more privacy.
Most significantly, it allows homeowners strapped for cash to rent out the adjacent unit to subsidise mortgage payments, even though some landlords might be reluctant to live so close to their tenants.
Prime for investment
Dual-key condos are attractive for investors as they offer an opportunity to maximise rental yields while minimising investment risks.
The average three-bedroom unit commands a hefty rental rate, and typically appeals to families or expatriates who face restrictions in purchasing property.
A landlord may choose to rent out rooms, but this comes with its own challenges such as tenant disputes and maintenance of common areas.
A dual-key condo offers the flexibility to rent out the condo as a whole or each unit separately, thereby making the property appealing to a wider demographic. If one tenant moves out, the landlord will continue to generate income through rental of the other unit.
Issues such as tenant disputes or maintenance of the common foyer would be relatively minimal compared with renting by room in a landed property. That said, a compromise when it comes to certain amenities bills might be required.
Presently, new dual-key condos may be priced similar to or more than its two- or three-bedroom counterparts. But given that rental prospects could ease financial burden in the long run, it is very likely this configuration will become more common in Malaysia in the near future.