Kuala Lumpur is becoming a preferred destination for property investors, backed by Malaysia's stable economy and the city's relative affordability.
There is a limited supply in the mid-to-luxury condominium market and the property market is mainly driven by owner-occupiers. New projects recently launched have attracted positive responses.
For example, Malaysia's YTL Land & Development sold all 338 units at The Capers in Sentul East within two days. Most buyers were locals, while foreign purchasers included Singaporeans, Europeans, Indonesians and South Koreans.
Eddy Wong, head of residential with DTZ in Kuala Lumpur, says the city's luxury market improved in the second half of last year after a period of consolidation. Prices went up 5 to 10 per cent during the year.
'The broader residential market was extremely positive, with prices in selected sectors appreciating by up to 30 per cent, resulting in the government imposing measures in November to cool down the market. Housing loans are now restricted to a maximum margin of 70 per cent for the purchase of a third home,' he says.
'The city centre condominium market is still very much sought after and investors can expect a rental return of about 5 per cent.'