About 15 to 20 years ago, the generation of home buyers were mostly inclined towards purchasing landed homes.Today’s home owners, in contrast, have no qualms about exchanging spaciousness for enhanced security and better facilities provided by high-rise residences.
With Malaysians being very much a car-centric society in spite of the improvements in the public transportation network, the availability of parking bays remains one of the major draws of condominium living.
While the current practice is for developers to designate a certain number of parking bays based on the size of the unit, there are still a number of apartments that do not come with parking allocation. Nevertheless, Prop-ertyGuru Malaysia country manager Sheldon Fernandez believes this to be a rarity.
“Given the local landscape where most Malaysians drive or choose to own cars, most developers would opt to provide at least one parking for each unit of condominium.
“I believe condominiums without parking are a rarity and will remain so given the unique sentiment here towards car ownership,” he says.
As such, he stresses parking spaces continue to be an essential component of a development’s overall value proposition, with proximity to public transportation only helping to a certain extent as people in general still wish to own cars.
From a marketing perspective as well as based on prevailing sentiments among Malaysians, he says the case is strong for developers to provide parking lots in their high-rise projects.
“Even with the arrival of ride-sharing services, car ownership is still highly desired. There are times when people still prefer to take their cars out, say during the weekend or when travelling outstation,” he notes.
Fernandez points out that developers often market allotted residents’ parking as one of the selling points of their condominium projects.
According to him, the attractiveness of a condominium to potential prospects grows in tandem with the number of parking bays provided. “But usually, the number of lots must correspond sensibly with the size of the units purchased. Penthouses would have more lots while studios may have a smaller number – one to two at the most,” he explains.
He observes, however, that there are many older condominiums in the market which were built in the 80s, 90s and early 2000s that are sold in the secondary market with minimal parking lots, such as one bay for a 1,200 sq ft unit.
In cases of high-rise residences that offer zero or insufficient parking allocation for residents, Fernandez says the alternatives available for them include renting extra bays from other owners or completely forgoing driving their private vehicles and using public transport.
“Other alternatives include living close to one’s workplace or school and then walking or relying on pedal power – bicycles,” he says.
Another option, he notes, would be for the parking lots to be sold separately as optional for unit buyers, which could provide monetisation opportunities.
However, he raises the question of how many Malaysians would choose to purchase such units given the high car ownership rate. Moreover, the absence of attached parking lots can affect the apartments’ resale value.
FocusM spoke to a unit owner of Empire Damansara in Petaling Jaya who says although the developer did not provide any parking lot for his duplex, he has not experienced any difficulty in securing tenants.
While he does find it inconvenient, he finds it acceptable to pay an additional RM100 to RM200 a month for a parking bay.
With residents’ parking being such a major selling point, does the lack of them decrease the appeal of a particular project?
Fernandez agrees units that come with parking spaces generally fetch a better premium than those that don’t, although it ultimately goes back to offering the right product to the right audience at the right time.
“If condominium units are sold without parking lots in Malaysia, it could be a novel approach to bring down the overall price of homes, thereby making them more affordable. After all, not everyone wants to drive,” he opines.
When it comes to how developers would market their products when there are parking constraints, Fernandez reveals that typically, the incentive would be reflected in the overall pricing proposition.
“They may offer discounts, waivers or rebates or even free maintenance charges for a fixed period to compensate for the lack of parking bays,” he explains.
Property blog kopiandproperty.com executive editor Charles Tan stresses the absence of allocated residents’ parking does not always translate to lower prices as other factors might come into play.
“When we buy a home and want to buy an additional car park space, it may cost RM40,000 or higher but homes built without parking spots allocated are not necessarily cheaper.
“The reason is because the developers would usually have an alternative which is a direct link to a public transportation station,” he says.
Good connectivity, he clarifies, does not only mean direct walkways to stations but also includes nearby bus stops where passengers can hop on and off transit buses that arrive and depart in a timely fashion.
Fernandez opines high-rise residences with no allocated parking would work better for smaller units targeting certain segments of buyers and tenants such as studio apartments for expatriate professionals as well as foreign and local students who may opt for public transport.
“The strategy, perhaps, is to build smaller units that come with limited parking lots say, just one, rather than full-size three-bedroom condominiums which require multiple parking bays,” he says.
Families and working professionals are usually not part of the target segment. This is mainly because families would most likely already have one car. On the other hand, working professionals could be planning to get one if he or she hasn’t bought one already.
“I would guess such apartments would target buyers who wish to rent out to students, especially foreign students, but honestly, this would apply more to condominiums that provide limited parking lots rather than none at all.
“Expatriates who work in the city centre and rely mostly on public transport are another target group,” Fernandez points out.
Tan agrees, saying such homes would not appeal to families with young kids. In terms of rental, he points out that young working professionals may not have a need for a car park space, choosing instead to rent places in close proximity to public transportation.
Undeniably, the availability of parking bays would help increase the asking rental rates if prospective tenants indicate they are looking for a unit with allocated car parks.
“If there are alternatives which are almost equal in price and one has parking spots while the other does not, then the choice is clear.
“That’s why rental for units with a parking lot is higher than one without, and tenants would have to make a decision based on what they want or need,” he says.
He surmises that at the end of the day, developments that do not provide attached residents’ parking are merely targeting a different segment.
Aside from different selling points, pricing and target buyers, condominiums that do not provide parking allocation for residents also raise the possibility of haphazard parking.
Tan says such a scenario can usually be observed for older apartments that have no direct access to public transport as well as insufficient parking bays within its compound, in addition to narrow access roads leading to the developments.
The Empire Damansara unit owner concurs, noting that the issue is not whether parking is allocated for residents but whether there is sufficient parking within and around the development.
While there does not seem to be a solution for the older apartments, Tan highlights that newer condominiums tend to provide two parking lots or more for each unit.
“As for integrated developments, the roads are much wider and this is true even for those affordable homes built within the vicinity. Hopefully, this will get even better,” he says.
PropertyGuru Malaysia’s Fernandez points out it is a habit of Malaysians to begin parking their vehicles at the roadside when there is not enough parking.
Though he agrees this might work, it is also usually illegal and could cause a new set of problems such as traffic congestion, security problems and theft.
“It isn’t a given but yes, this happens quite often unfortunately. Prevention is possible if those parking show consideration for road users and also stronger enforcement by local city and municipal councils,” he stresses.
A solution may be on the way, however, as Fernandez believes the emergence of mobile applications that allow people to rent out their empty parking spaces could become a mainstream option, although it remains more on the sidelines for now. FocusM