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Tourism is one of the vital segments contributing to Malaysia’s vibrant economy and over the years, it has played an important role in boosting the country’s GDP.
As a result, this segment has also become a prime income source for various locations that evolved into highly sought-after tourist destinations.
However, the pandemic of 2020 proved to be a big blow to the country’s tourism and hotel industry.
In 2019, tourist arrivals brought in RM86.14 billion to the country’s economy while tourist arrival growth was recorded at 2.4%.
It was a pandemic-free world then. This figure was anticipated to increase in 2020 before the pandemic hit and changed everything.
Needless to say, the impact of the pandemic also affected the property market.
The information below details how much it would now cost to purchase an investment or vacation home in three tourist hotspots, post-pandemic.
1. Port Dickson
Interstate travel is still not allowed in Malaysia. Port Dickson however, is the nearest beach to Kuala Lumpur where one can unwind over the weekend or during long holidays. It is an urban populated area with busy streets along its shores.
Mostly known for its white sandy beaches with Blue Lagoon and Taman Aman famous for its water sports activities, the prices of properties here can be a little steep compared to those further away from the beach.
Many choose to buy their second home in Port Dickson so they have ready accommodation over long holidays with the family.
Meanwhile others choose Port Dickson as their primary habitat so they can enjoy the beaches and other local tourist attractions all year long.
In 2019, the average house in Port Dickson was pegged at RM220,000 but in 2020, property prices dropped by 11.6%. What’s more, property transactions in 2020 compared to 2019 fell by a dramatic 78.76%.
This shows Port Dickson’s property market took a beating from the pandemic, as did its tourist arrivals.
Therefore, if you choose to snap-up a property for investment at a bargain price, Port Dickson could be a good location to start.
2. Batu Ferringhi
Located in the popular town of Penang, this tourist attraction is just thirty minutes away from Georgetown by car.
It is known for its exotic sandy beaches and holiday resorts where both local and foreign tourists crowd over the holidays and festive seasons.
In past years, there has been a flurry of activity in Batu Ferringhi as developers scrambled to build luxury condominiums, villas and hilltop bungalows.
This is a great area to purchase a holiday home or invest in property as it is self-contained with mini marts, banks, restaurants, petrol stations and other amenities located nearby. However, the area has limited schools and the nearest hospital is Gleneagles in Georgetown.
The wide range of affordable houses in the area is best for retired couples, to be used as holiday homes or as second homes for investment as a homestay or inn.
The properties in this location were at a median price of RM600,000 in 2019 but the average price of properties here dropped 11.85% to RM528,888 after the pandemic.
Sales transactions in this area also dropped by 39.51%
If you’re looking to buy a luxury villa or condo in Batu Ferringhi at below-market rates, this might be the time. Many developers are keen to offer discounts since transactions in 2020 were rather dismal.
3. KL City Centre
Kuala Lumpur City Centre is the heart and capital of Malaysia. The city is famous for its iconic Petronas Twin Towers, posh malls, shopping galleries, parks and endless amenities.
It is also a food haven with cuisines from around the world served up in its many fancy, upmarket restaurants.
Kuala Lumpur offers a variety of property types from low-cost apartments and bungalows to luxurious homes.
It can be said that KL City Centre is the choice of the most elite local residents as well as foreign expats. This makes it a high-end residential area.
Needless to say, the properties here have also suffered due to the pandemic.
In 2019, the average price of a house here cost about RM1,030,000. However, due to the pandemic-induced economic downfall in 2020, prices have dropped by 17.48%.
The median price of houses here was RM850,000 in 2020, which shows that this area has been impacted the most among the three hottest tourist locations in Malaysia, in terms of price.
Sales transactions also registered a severe drop of 51.62% in 2020 compared to 2019.
Overall, the decline in tourist arrivals with the combined economic impact of the lockdowns due to the pandemic has caused house prices in these areas to drop significantly.
However, with the rolling out of vaccines and economic recovery, property prices in these locations will soon start to recover as well.
So, if you’re a homebuyer or an investor looking to buy a second home, now might be a good time to buy that property at a negotiable price.
This article was written by Fahri Ahmed for PropertyAdvisor.my, Malaysia’s most comprehensive source of property data, property analytics and insights.