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Tim Murphy

Why you should be investing in Kuala Lumpur this year

LOFT speaks to Tim Murphy, new presenter of TV property show Buying Asia.

What sort of buyers are currently investing in KL?
KL attracts a range of buyers from first time to experienced investors who want to diversify. Its an easy step for people who want to invest in the Asian story but also want the stability of legal structure and financing options which is generally only found in developed economies. The only other places in Asia that really offer this are HK and Singapore which are already very expensive property markets.

What makes KL an attractive place to invest in?
The domestic market is fairly liquid – locals are renting, buying and selling in the KL housing market. Domestic demand for property is strong.

Is the KL economy strong/expected to stay strong?
The economy remains strong, largely due to its diversity encompassing 11 industry sectors such as healthcare, electronics, palm oil, communications and tourism to name a few. The government is aiming to achieve an average growth rate of 7.1% over the next 10 years.

Are property sales/prices on the rise generally in KL?
Recent reports have detailed that transaction values in the residential sector between July and November 2010 increased by 15.5% y-o-y equalling RM22.6 billion (US $7.4 billion) and commercial transactions rose by 22.4% to RM9.78 billion (US $ 3.2 billion) during the same period. High growth rates were recorded in Kuala Lumpur, Selangor and Johor. The three major states recorded positive growth of 8.2%, 7.2% and 3.6% respectively.

What are the main motivators behind the increase?
2010 was a year of strong economic growth and additionally in the 2 years prior developers have not been launching an excessive amount of projects. As mentioned earlier there is strong domestic demand for property with the value of property transactions increasing by 35% in 2010, as well as a mature finance market. The government hasn’t introduced any cooling measures recently thus the market should continue to accelerate. Additionally, under the ETP programme the Malaysian government plans to make the country developed nation status by 2020 which will see continued rapid urbanization.

Is it easy for foreigners to invest in KL?
Yes, Malaysia is a comparatively straightforward market to invest in compared to other emerging markets in Asia. The government actively encourages foreign investment through schemes such as Malaysia My Second Home and the banks are well-versed in lending to foreigners. Once you decide to buy, the procedure is fairly standard as you are able to process documents remotely and the business language is English allowing for easy communication.

Are there any particular areas/locations in KL that you’d recommend?
With oversupply of large high-end condos in KLCC, residents and investors should look to the suburban areas close to the city centre such as Kenny Hills and Mont Kiara.

Kenny Hills is the most exclusive suburb in Malaysia with its inhabitants largely made up of CEOs and politicians. Given the high-end nature of this area it mostly features low-rise villa properties. There is limited supply in this area and it is only 10 minutes from the city.

Mont Kiara has proven popular with investors and residents alike. It is closely located to the city centre with enough space, schools and facilities to provide a suburban lifestyle in a convenient location. Additional plans to extend the LRT system to this area will see prices appreciate in the future also.

Are there any examples of property available to buy now?
Currently, IP Global has access to units in the second of only two condominium projects with planning permission in Kenny Hills. Blessed with magnificent views of the KLCC skyline, Arata is a low density development in a highly sought after suburb.  Conveniently located and with an abundance of schools and facilities, this development is reasonably priced starting from US $510,000.


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