Public transportation effect on the rising of property prices in Malaysia: a correlation study of MRT project  

Oleh:

Moorthy, Rajeeshwaran

Jenis: Article from Proceeding
Dalam koleksi: SIBR-Thammasat 2014 Conference on Interdisciplinary Business & Economics Research June 5th- 7th, 2014 di Emerald Hotel Bangkok, page 1-3.
Topik: (Public Transportation; MRT Malaysia; Property Price & Housing Bubble).
Fulltext: b14-171.pdf (19.54KB)

Isi artikel

The Malaysian real estate sector started in early 1990’s. Starting year 1996, Malaysian housing loan increased steadily in an upward trend. This indicates that the demand of real estate have been increase and it implies that purchasing power of Malaysian had increase. Furthermore, the increase suggest that increased in population demands more housing. Despite going through three financial crisis, the Malaysian house price remain strong. The prices of house have seen an increases of 20.3% in 1991 and later rose 14.4% in 1995 and during the Asian financial crisis In between 1997 and 1999, Kuala Lumpur’s house price remain robust. Real estate prices has always been closely related to the availability of public transport. A house located near public transit will tend to be sold at a premium. This is due to the convenience that public transportation brings to a certain neighborhood, it enables people to travel from one part to the other in a relatively short time. Therefore the public is able spend lesser time on transportation and spend more time doing more efficient affairs. (John A. Kilpatrick, 2007) The study of public transportation also suggest that a better availability would increase the value of real estate. Based on (Alonso, 1964) study, he concluded that any location which is accessible to main road, public transport and retail outlet or convenience stores commands a higher price. In Malaysia, similar trend has started as a report from (Su-Lin, 2013) stated that property next to the upcoming MRT stations has seen an increase around 11%-19%. This research was done with the aim of identifying the correlation between the recently announced (on-going) MRT project in Malaysia with the rising of property prices in the country. The study focuses on selective region where the primary MRT stations have been proposed with the property prices of that particular region. The research methodology was based on the empirical evidence of property prices of a particular region before as well as after the announcement of MRT project stations. It’s been concluded there is a stronger correlation between the rise in property prices due to higher market expectation within the region. This research also contribute to the indication of potential miniscule housing bubble crisis in Malaysia.

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