Land or homestead is a niche product in Malaysia, and demand for this type of property is generally low here. Even so, homesteads remain an attractive form of alternative investment, particularly for hobbyists and those looking to build their dream home, weekend retreat or future retirement home.
“There is always a demand for such properties and most buyers would choose properties for two main reasons: getting away from the city and for the natural surroundings. It’s the hilly terrain, the lush greenery, the crisp, cool air and the crystal clear streams that draw them in. They want a change from city life. Landserve Sdn Bhd.
“These properties may also become more popular due to the Covid-19 pandemic and other factors, as more people prefer to live closer to nature and away from densely populated areas.”
In addition to agricultural parcels on the market, interested buyers may also consider homestead developments or schemes. Some farm developments in the market are Tanarimba in Janda Baik, Bentong, by Sitrac Corp Sdn Bhd; the [email protected] by Karak Land Sdn Bhd, a subsidiary of Bina Puri Holdings Bhd; as well as Planters’ Haven in Nilai by Sime Darby Property Bhd.
According to CBRE | WTW Managing Director Foo Gee Jen has negotiated and selling prices at Tanarimba range from RM13 to RM22 psf. Comprised of 803 lots, Tanarimba has a visitor center with a multi-purpose hall that can accommodate up to 500 people, as well as walking and hiking trails.
According to EdgeProp.my, a 51,667 sqft leasehold agricultural land with soft ground in Tanarimba was traded in November 2020 for RM1 million or RM19.35 psf. The website quotes Reapfield Properties property negotiator Jennifer Yap, who brokered the deal, as saying the buyer was looking for land in the highlands not too far from Kuala Lumpur to build their vacation and future retirement home, and he loved the terrain for the cool mountain air and cool climate.
Meanwhile, The Valley has three phases comprising 158 lots, 138 lots and 171 lots respectively. Prices range from RM7.35 to RM13.20 psf and the development has facilities such as an event hall, swimming pool, tennis courts, gym and exhibition space.
Planters’ Haven is a gated and guarded development comprising 158 lots and a clubhouse with an infinity pool, tennis court, gym and function room. Negotiated and selling prices range from RM19 to RM26 psf, Foo says.
According to an EdgeProp.my listing, a 43,560 square foot freehold agricultural land and bungalow plot in Planters’ Haven has been listed for RM1 million, or RM22 psf.
Another farm development in the market is [email protected] Cove in Pulau Carey, says Chen from Landserve. “It is also important to note that there are many resorts, such as Song Yan Resort and The Acres Resort in Bukit Tinggi, Bentong, which provide a family living experience. Thus, those who want the experience cannot necessarily [have to buy] family property immediately.
“There are many factors to consider when buying a homestead, which is a niche product aimed at a specific segment of the market.”
This segment of the market is unique, says Foo. “For me, farms have always been something that people look to as a form of alternative investment, and also as a hobby, when they have some spare cash.”
Foo says farms generally appeal to two market segments. “Developments such as Tanarimba and Planters’ Haven are popular with the high-end market segment. Properties with a more temperate climate and higher land elevation also seem to be popular for getaway homes and weekend homes for the well-heeled. Of course, yuppies who made money during the bull run will be able to afford such properties.
“The second market segment that family properties attract are amateurs or those who want to build their retirement home. We are talking about the middle to upper classes, or the M40 group. He adds that the family real estate market is little affected by uncertain economic conditions.
Meanwhile, Chen observes that the buyers are mostly businessmen or professionals aged 45 and over. “The buyer profile may change in the future to include more buyers under the age of 45.”
“[Homestead real estate offers] unique opportunities for those looking for alternative assets as well as holiday and retirement homes. — Prévindran (Photo by Zerin Properties)
In terms of the outlook, Foo says the supply of homestead developments is likely to remain limited due to niche demand for such properties. “There are few developers with a sufficient and suitable land reserve for such large developments, and most will probably prefer to pursue other projects, which can generate better and faster profitability at this stage, such as plots of bungalows in the Klang Valley townships,” he explains.
“Nevertheless, the most suitable locations for family property developments in Malaysia are located further from the city center and have excellent connectivity and basic amenities. Areas with natural scenic views or in the highlands can also be appropriate.
“In the Klang Valley, suburbs such as Batang Kali, Semenyih and Hulu Langat are ideal locations for the development of family properties.”
“In the Klang Valley, suburbs such as Batang Kali, Semenyih and Hulu Langat are ideal locations for the development of family properties.” — Foo (Photo by CBRE | WTW)
Similarly, Managing Director and CEO of Zerin Properties, Previndran Singhe, says these properties “offer unique investment opportunities for those seeking alternative assets as well as vacation and retirement homes. [Homestead developments also benefit] soaring export demand for durians and a strong preference for a resort lifestyle.
“In the future, it is expected that more developers will come up with products with unique concepts that incorporate market-oriented elements, with sustainability, well-being and community living being the central aspect.”
According to Previndran, Tanarimba performed quite well, with 21 transactions recorded on brickz.my from January 2018 to January 2020.
Planters’ Haven by Sime Darby Property, located in Nilai, Negeri Sembilan, comprises 158 units of agricultural plots in a guarded environment (Photo by sime darby property)
Advantages and disadvantages of homestead developments
There are many advantages to buying land and property in a housing estate, as opposed to a stand-alone plot of agricultural land.
“In homestead developments, the developer provides the roads, street lighting, drainage, water, electricity, telephone network and landscaping. They are all ready to go and tap away,” says Chen from Landserve.
“In addition, when you choose your plot, you will already know its terrain and its orientation. So you can start planning your home design and where to plant your fruit trees in advance.
“The developer will then deliver the land to you as shown on the survey plan and, after taking possession, you can immediately start building your house or planting your trees. You are unlikely to have such convenience when buying [standalone] agricultural land. In such a case, you must first clear the site, carry out earthworks and build the infrastructure.
In addition to having well-developed residential infrastructure, CBRE | WTW’s Foo says homestead developments also provide a higher level of personal and family security.
The disadvantages of farm developments would be the price of land and maintenance costs.
“Homestead developments are more expensive because the developer provides the infrastructure such as roads and drainage,” says Chen.
Since farms are typically located farther from towns or city centers, Foo says, they likely have limited access to commercial developments and amenities.
Therefore, Chen believes that ideally family properties should be located within an hour’s drive of the city. “Whether they are using their homestead as a weekend getaway, a vacation home or a place to retire, it would be ideal for such developments to be located within an hour’s drive of the city, where the natural surroundings are attractive and land prices are much more affordable.While they are living in the property and enjoying what their property development has to offer, it is important that the city is not too far,” he said.
