indepth

Old Klang Road rentals remain intact

Jalan Klang Lama or Old Klang Road (OKR), to those familiar with Kuala Lumpur, refers to the areas on both sides of the road that are situated not in Klang, but in KL. In the 1960s, apparently both sides of the road were flanked with factories, warehouses and oil palm estates.

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The 11km OKR is one of the oldest and busiest thoroughfares in KL.  It is also home to some of the oldest and most established housing areas in KL like Taman OUG and Taman Desa — with sought-after homes still commanding great value for their proximity to the city centre.

Those familiar with KL would recall how traffic jams and flash floods were synonymous with OKR. Over the years, the road has been widened and Sungai Kerayong, which flows through the area, has deepened.

OKR passes two towns, namely Sungei Way and Petaling Jaya. The west end connects to PJS 8, PJ while the east end links to Seputeh, KL, which is also connected to one of the most popular shopping complexes — Mid Valley Megamall.

Other than the prime shopping mall, there are some neighbourhood malls, such as Pearl Shopping Gallery and Pearl Point Shopping Mall, as well as pasar malams or night markets in residential areas along OKR, such as Kuchai Lama, Taman OUG and Happy Garden.

Areas along OKR have also evolved into an eclectic destination of gourmet delights punctuated by modern retail and residential properties, not to forget the fusion cafes, drinking holes and restaurants.

The easy accessibility is the main reason that supports the strong housing demand along OKR, making it one of the most sought-after addresses for working adults, especially those who relocate to the Klang Valley, says IQI Realty Sdn Bhd real estate agent Thomas Chong.

There are five junctions connecting to major highways including New Pantai Expressway, Jalan Puchong-Petaling Jaya and Jalan Kuchai Lama, Federal Highway, East-West Link Expressway and Jalan Syed Putra.

Its proximity to KL city centre and strategic connection to other major business hubs in the Klang Valley has no doubt continued generating buyers’ and tenants’ interest.

According to data from EdgeProp Research (see box story on previous page), prices of especially landed homes on Old Klang Road have remained strong over the years. Rentals have also remained firm, even during pandemic times.

Chong adds that the strong demand has supported the rental growth as there are always students looking for rooms and working adults who are looking for units along OKR which is conveniently accessible to their offices in KL city.

“For example, OUG Parklane is currently asking for RM1,200 to RM1,500 per month. Those better-furnished units can go up to RM2,000 per month. This is a high-density condominium with more than 4,000 units so there is enough supply in the market. I consider the rental rate decent although the asking price hasn’t changed since 2019,” he tells EdgeProp.my.

Unlike most of the areas in KL city centre where landlords are mainly aiming for expat tenants or short-stay accommodations, Chong says that OKR has attracted different groups of tenants — a good balance of city dwellers who work or study in KL — and this has helped to offset the impact caused by the Covid-19 pandemic.

Owners not pressed to woo tenants

On the stable rental amidst slow times, real estate negotiator Joseph Tin from CID Realtors Sdn Bhd explains that the majority of the property owners in OKR are either cash-rich or debt-free. Thus, the healthy financial position enables them to hold on to the asking rate and not feel pressured to reduce rental in order to attract tenants or buyers.

“They do not mind waiting longer for tenants, especially for the property owners of terraced houses in OKR as landed property is always a popular property type in that area due to limited supply in the market,” he adds.

He shares that terraced houses in OKR are asking for RM1,500 to RM2,300 monthly rentals currently, which have remained unchanged from pre-pandemic times.

As at Feb 10, 2021, EdgeProp.my has eight terraced houses in OKR looking for tenants with an average asking monthly rental of RM4,841 or RM1 psf against land size. Some 315 high-rise residential properties were listed for rent at an average asking rental of RM1,921 or RM1 psf.

Having said so, Tin notes that for larger houses like semidees and bungalows with bigger built-ups, some owners are willing to adjust the asking price to meet tenants’ budgets.

“On average, the monthly asking rental for semidees and bungalows here saw a drop of 10%- 20%, to around RM4,000 and RM7,000 respectively. This is mainly because the market is losing some corporate leasing and expatriate tenants. Therefore, the landlords are more open for negotiation recently because they can foresee the border will not be reopening so soon,” he adds.

Strong fundamentals

Despite the short term rental adjustment, CID Realtors’ Tin opines that OKR’s fundamental has remained healthy for its location, matured neighbourhood, good living environment and affordable choices for tenants.

“Do not be surprised that OKR is a popular address to foreigners. They like the place for it being not too far away from the bustling city centre, cheaper price for bigger space and the mature neighbourhood,” says Tin.

Meanwhile, the declining rental of semidees and bungalows will also attract business owners who are looking for well-maintained landed houses facing the main road to turn into showrooms or home offices.

“It is a fact that landed property with extra land in a good location along OKR has limited supply. The tenant may take a longer time to make a decision, but as long as the landlord is willing to give a little bit of discount, even during the pandemic, it will be rented out. Therefore, you will not see a drastic plunge of rental in OKR compared to the city centre,” Tin notes.

The attractive rental of landed houses also attracts tenants who have been staying in high-rise residential properties in this area to “upgrade” to bigger houses in OKR, mainly because landed houses offer them more freedom compared to strata living communities.

Tin notes that especially during pandemic times, there are increasing rental inquiries for landed properties as tenants are looking for spacious homes with fewer common areas to lower the risk of getting infected.

This story first appeared in the EdgeProp.my e-weekly on Feb 19, 2021. You can access back issues here.

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