Research by Kenanga shows Negeri Sembilan is gaining an increase in residental transaction volume of 9% of Malaysia market share with 5-year average of 5%.

In terms of residential transaction volumes, Klang Valley has lost market share, although it still remains as the major driver of Malaysia’s residential transactions. States that has lost market share are (i) Klang Valley, which makes up 30% of Malaysia vs. its 5-year average of 37% (ii) Penang, which makes up 7% of Malaysia vs. its 5-year average of 9% (iii) East Malaysia, which makes up 7% of Malaysia vs. its 5-year average of 8%. States that gained market share are (i) Johor, which makes up 15% of Malaysia vs. its 5-year average of 12% (ii) Negeri Sembilan, which makes up 9% of market share vs. its 5-year average of 5%.

Key States Market Share as % of Malaysia (Residential Transaction Volume)

It is not surprising to see Klang Valley and Penang losing market share because: (i) land prices has risen in both states, making it tougher for developers to landbank, (ii) Penang already has limited landbanks on the island and demand is now compensated by the mainland, (iii) established developers have hit a ‘high-base’ effect in Klang Valley where their group sales growth requires their other states and/or overseas projects to achieve sales growth. Negeri Sembilan has also moved into the spotlight, thanks to Seremban, which has benefitted from the Greater Klang Valley play and renewed industrialisation;
this has been beneficial to developers like MATRIX (Bandar Sri Sendayan) and IJMLAND (Seremban 2).

In Johor’s case, the increased market share is explained by: (i) the Iskandar Malaysia story, better G2G collaborations between Malaysia and Singapore, PETRONAS RAPID and other O&G related developments that have attracted nonJohorian locals and foreign buyers to the market, (ii) Johor’s awakening after more than a decade and is playing catch-up with Klang Valley in terms of product offerings and pricings. The key question is whether Johor can sustain such demand
momentum given concerns of strong incoming supply of high-rise residentials.

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