How much do condos near the new stations cost?

LET’S face it; we all hate getting stuck in traffic jams. Not only does it take up precious productive time, it is costly as we have to spend extra money on fuel. Recognising the need for an efficient public transportation system covering a wider range of areas, Prasarana Malaysia Bhd, the asset owner and operator of the country’s two Light Rail Transit (LRT) networks, announced in April this year that the Kelana Jaya Line extension is on track for opening and operations on June 30.

The extension line will see the addition of 12 new stations — Lembah Subang, Ara Damansara, Glenmarie, Subang Jaya,
SS 15, SS 18, USJ 7, Taipan, Wawasan, USJ 21, Alam Megah and Subang Alam ending at Putra Heights, which is an integrated station with the extended Ampang Line. The new extension will cover a distance of 17.4km, which gives the Kelana Jaya Line a total of 46.4km.

Out of the 13 stations, TheEdgeProperty.com has identified eight which have the most listings of non-landed residential properties surrounding the stations.

The eight stations are Lembah Subang, Ara Damansara, Subang Jaya, SS 15, USJ 7, Taipan, Wawasan and USJ 21, which all have a minimum of at least five projects in the radius of 1km from the stations. The average asking prices for these projects were calculated, and from there, we identified the projects with the lowest average asking price psf.

The properties around the Subang Jaya station have the highest average asking price psf (RM801 psf) followed by SS 15 (RM751 psf). Meanwhile, properties surrounding the Taipan station have the lowest average asking price psf (RM420 psf) among the eight stations.

The Lembah Subang and Ara Damansara stations located 500m away from each other share the same project with the lowest average asking price psf — the Kelana Puteri condominium — with an average asking price of RM434 psf.

Subang Jaya station

According to GMAC Realtors negotiator Adrian Tan, one of the contributing factors to the high asking prices for non-landed residences surrounding the Subang Jaya LRT station is the area’s centralised location and the fact that the area is known as the unofficial city centre of Subang Jaya.

“Even before the LRT extension, this area, which includes the area around the upcoming Subang Jaya LRT station, was already the unofficial city centre with Subang Parade and Empire Subang drawing the crowds.

“It has excellent connectivity as it is located along the Federal Highway connecting UOA’s business park and Sime Darby’s first TOD (Transit Oriented Development) — the Subang Jaya City Centre (SJCC), which makes it very visible and accessible,” he said.

Tan added that the location has limited land, has high plot ratios and high land density use. In addition to that, the Subang Jaya station is also an interchange station to the KTM Komuter Line, which gives commuters even more destination options and greater accessibility.

Tan also noted that the value of a station is derived from its demand and usage.

“A station that experiences higher usage is perceived to be more valuable. The LRT is a public good, so it does not make sense to measure the value of each station from the profit generated, but instead, by its usage. A station with a higher perceived value will have a larger positive effect on the surrounding properties (in terms of capital appreciation), which will eventually influence the prices of properties surrounding the station accordingly,” Tan offered.

So, have the prices of properties reached its peak in Subang Jaya?

“No, it has not peaked. This is the city centre of Subang and it is currently developing with room for maturity. With proper implementation and integration among the different classes of properties, retail, residential and commercial, I foresee the trend towards more TODs in future [in Subang] and the emergence of a new breed of urbanites. Urbanites who will favour such developments and will start to forgo the need for their own private vehicles and will plan all their work and leisure activities along well integrated rail lines,” he said.

According to City Crest Realtors principal Darren Khor, the Subang Jaya and SS 15 stations will have the most growth potential in terms of price appreciation.

“One of the notable features of the Subang Jaya area is that it is highly populated with students from higher education institutions such as Taylors University Malaysia (Subang campus) and Sunway University nearby. Once it starts operating, the students will utilise the LRT facility to travel around and get about, especially students who are not local. For example, to get from Subang to the city centre, they can easily hop on the train rather than take a cab. Students who are studying locally may also opt to not drive or save money and move around with the train line,” he said.

Khor believes that once the infrastructure [LRT line] comes up, the prices of the surrounding properties may even go up to RM1,000 psf from the current high of RM800 psf.

“Coupled with the improvement in market sentiments and the political climate, residents and investors can expect to see some 20% increase in capital appreciation,” he added.

USJ 7 and USJ 21 stations

Meanwhile, other notable stations include the USJ 7 and USJ 21 stations. According to data from TheEdgeProperty.com, the average asking price psf for non-landed homes within a 1km radius from the USJ 7 and USJ 21 stations were RM447.5 and RM473 respectively as of mid-May 2016. The Casa Subang condominium commanded the lowest average asking price psf in USJ 7 (RM381 psf) while the Tropika Paradise condominium commanded the lowest average asking price psf in USJ 21 (RM390 psf).

“I would look at areas where the stations connect a previously unconnected area with desirable location factors such as schools, health care and shops, along with a demographic that will support the usage of the LRT. In the long term, the addition of the LRT station in such an area will create a demand pull and impact property prices,” said Tan.

“The USJ 7 station is located in a demographic that welcomes LRT usage. This is hinted by the mid-segment properties such as the Goodyear Court developments, the various factories near the stations, and low to mid-priced shopping avenues such as the Giant and Mydin hypermarkets and the Summit Shopping Centre. The fact that this station interchanges with the Bus Rapid Transit (BRT) also gives the residents another transport option to places such as Sunway (currently not connected by the LRT) and Sime Darby’s second TOD — the Union Square — which will be located in USJ 7 as well,” he noted.

He added that it will be interesting to see how a mix of new generation offices, hotels and high-density residences will integrate with the area.

Over in USJ 21, Tan highlighted that amenities such as a shopping mall, The Main Place, the nearby commercial centres that have good connectivity to the station via Jalan USJ 21/10 combined with the availability of park and ride facilities at the USJ 21 station will address the first/last mile connectivity to the station very well be it by car, drop off or by walking.

“In USJ 21, the prime lands with the best access to the LRT stations are being utilised very well,” said Tan.

Ara Damansara

Meanwhile, in Ara Damansara, there are two LRT stations located 500m apart from each other namely the Lembah Subang station and Ara Damansara station.

“The average rental for condos and apartments here are priced within the range of RM1,500 to RM2,500 a month indicating middle class affordability. I strongly feel that new developments here that are fairly priced and that match the affordability demand of the local demographic will do well,” Tan noted.

However, he stressed that having a Mass Rapid Transit (MRT) or LRT station near a property does not guarantee increase in property prices or rentals.

“The capital appreciation of property prices is influenced by a few factors; namely the distance of the property to the station, the local demographic, supporting infrastructure, consumer behaviour, government policy, line integration and destinations,” said Tan.

“According to the KL 2020 structure plan, the current public transport utilisation rate is 20% with the target to achieve 30%-40% utilisation. There is still a lot to be done for us to change into a more public transport-reliant nation like Singapore or Hong Kong. Properties near LRT stations will fare well when the utilisation of the LRT improves so do not expect to see overwhelming price increases throughout all the properties near LRT/MRT stations until we have a clear and coherent public transport policy and increased public transport utilisation,” he concluded.

Do not ask your father-in-law about the value of your home. Go to The Edge Reference Price to find out.

This story first appeared in TheEdgeProperty.com pullout on June 17, 2016, which comes with The Edge Financial Daily every Friday. Download TheEdgeProperty.com here for free.