IN CASE YOU MISSED IT

I'm not buying a home in Iskandar until prices come down

This story was first published in The Straits Times on June 9, 2013

I have visited Iskandar Malaysia seven or eight times this year to write about the development, prompting friends and others to ask the inevitable question: Have you bought a house there yet?

The short answer is: No.

I have met many happy people who have bought homes in Iskandar; some more than one, while others are looking to buy their second or third property.

I don't think they're foolish or wrong but I will not be joining their ranks any time soon.

Singaporeans and Singapore-based expatriates are buying homes in Iskandar for two main reasons: to live in a low-cost and spacious environment or to invest in what could be a boom town for property.

I don't really want to do either of those things.

For starters, I think we are at a point where it is either too late or too early to jump into the market.

Property prices in Iskandar have doubled or even tripled in the past two to three years. True, homes are still much cheaper than in Singapore, but a good investment is not one that is merely cheap, but one that holds great potential value.

Several bankers and property consultants I have spoken to have even started calling the area's property market a bubble.

In fact, they noted, prices in Iskandar - population 1.3 million - are already level with those in Kuala Lumpur, yet Kuala Lumpur is a mature city where multinationals place their offices and expat staff.

If there is a city in Malaysia where you could most easily get rental income, it would be Kuala Lumpur.

Iskandar's commercial scene, on the other hand, has yet to take off. The multinational firms already doing business there are mainly operating out of factories and hire blue-collar workers.

These companies are more interested in renting dormitories for their workers than swanky apartments for themselves while the bosses are buying their own homes.

For now, a lot of hope is being pinned on Pinewood Iskandar Malaysia Studios, the Nusajaya offshoot of the British film studio that produced the James Bond and Harry Potter movies.

It is expected to create a constant pool of transitory workers that will fill the rental market once it opens next month. The firm said it will create 1,500 jobs by the end of the year.

It will then bring in a stream of actors, directors and other movie production professionals, all of whom will need housing in Iskandar while shooting films for months at a stretch.

This will likely create some demand for rental accommodation, but Pinewood Studios remains the only big commercial player to start operations soon.

Many others, such as billionaire Peter Lim's Motorsports City and Afiniti Medini, which will have a hospital and a corporate training centre, are still years away.

In the meantime, there are now 430,000 homes in Iskandar, with 64,000 more under construction and still much more land that is yet to be developed.

I would consider investing in Iskandar in the future but I would first like to see a pickup in commercial activity there, and for prices to come down to more reasonable levels.

Of course, many people are buying houses in Iskandar as getaway homes, but I don't want to live in Iskandar because I don't drive and I don't want to get a driving licence.

Many of its new and sparkly housing developments are in Nusajaya, a former jungle that has been cleared - yet much of it is still empty and amenities are spread out.

There is one public bus that comes by hourly. If you are in a hurry or want to go somewhere not along the bus route, you would have to drive.

The Iskandar residents I have interviewed say they enjoy the peace and quiet of the place and the fact that there are no crowds, unlike in Singapore.

But I like living in a city. I enjoy the constant buzz and excitement of city life while my flat gives me all the peace and quiet I need.

Plus, if I move to Iskandar, wouldn't I be contributing towards a more crowded Johor?

I'm looking at this over the long term. Eventually, more and more Singaporeans will move across the Causeway to retire in the house of their dreams.

I will still be in Singapore, enjoying empty MRT seats and reading a book in peace and quiet.

yasminey@sph.com.sg

This story was first published in The Straits Times on June 9, 2013 

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