PPC International managing director Datuk Siders Sittampalam says overflooding in a particular locality can have an impact on property values.
THE Klang Valley has been battered by torrential weather over the recent months, with many residential areas being hit by flash floods.
While flood events in Malaysia are not classified as extreme disasters, they have an adverse impact on the population and cause significant damage to properties.
PPC International managing director Datuk Siders Sittampalam says overflooding in a particular locality can have an impact on property values.
“Historically, it would affect demand for residentials within that locality.
“Buyers may look at other places while owners in flood-prone areas may want to sell their properties,” he tells StarBizWeek.
Savills Malaysia Sdn Bhd group managing director Datuk Paul Khong says property prices and values are inversely affected by the severity and frequency of the flash floods.
“As this is becoming a repetitive problem in the Klang Valley, many badly affected flood-prone areas are now becoming a concern and with this continuing, these neighbourhoods become blighted and less desirable as basic property locations.
“On a long-term basis, it will have drastic implications to capital values, actual real demand and usage. The flash floods are becoming a nightmare to all the affected properties.”
City Valuers & Consultants Sdn Bhd real estate services and business development head Ruben Kelvin agrees that properties in flood-prone areas will have less demand.
“On top of that, post-flood effects can lead to further depreciation of a property where homeowners will have to set aside funds for structural repairs.
“With the rise of raw material costs, repairs can become expensive.”
Khong: If no action is taken, these areas will fall into disrepair and we will see a major impairment in values.
Additionally, Ruben says conducting restoration or renovation works in flood-prone areas can result in regulatory and insurance issues, thus making the fixing and repairing process much more difficult for homeowners.
“High-rise units such as apartments and condominiums will also be affected with the common areas, parking bays and lifts sustaining damage.”
Khong says developments within flooded zones will face an uphill task when it comes to selling the property, be it in the primary or secondary market.
“Prices will be directly impacted as potential buyers and residents will tend to avoid low-lying areas with flood issues or units situated near a river, for instance.”
However, Siders says the impact to the value of the property would ultimately depend on whether demand gets affected.
“If demand is good in that locality due to excellent access to public transportation and amenities, then, regardless of weather conditions, the impact would be mitigated.
“It all really depends on how much sentiment is affected and if initiatives have been taken by the authorities to mitigate the impact of the flash floods.”
Additionally, Siders says Malaysians are known to “move on” from disasters fairly quickly.
“When the Highland Towers landslide tragedy occurred back in 1993, there was an immediate decline in transactions within that locality. But it was only for the short term.
“Right after the incident, the authorities came up with stringent highland development regulations. It wasn’t long after before buyers got their confidence back again.”
Siders believes that a similar trend can be expected of flood-prone areas if the relevant authorities took immediate, preventative measures that would help to regain the confidence of potential homebuyers.
Resolving the issue
Ruben: Flood forecasting like telemetric warning systems and evacuation measures can be done for areas that are flood-prone.
Khong says the government needs to step in and undertake proper mitigations to counter the flash flood problems urgently.
“There is also a need to clearly address the density of buildings within the city and drainage infrastructures.
“If no action is taken, these areas will fall into disrepair and we will see a major impairment in values.”
He says the Kuala Lumpur City Hall needs to work together with the federal government to try to resolve the never-ending flood issues.
“Conduct an investigation and realistically study the existing roadworks and the high-rise developments, as well as the surrounding infrastructures that are contributing to the floods.
“A proper long-term solution is now extremely critical and upgrading the existing and/or introducing a new drainage system, perhaps even better than the existing Smart Tunnel, is paramount to handle these flash floods.”
Meanwhile, Ruben, who is also business development head of Greenhill & Mason Sdn Bhd, says there are a few structural and non-structural measures that can be taken to resolve the flash flood situation in the Klang Valley.
In terms of structural measures, Ruben says storage ponds can be utilised to tackle floods.
“The objective is to divert the flood water though such ponds and regulate the outflow so that flood peaks are attenuated.
“This strategy has been used in the case of the Batu/Jinjang Pond Project in Kuala Lumpur, where excess water was diverted from Sungai Gombak to the Batu Pond for temporary storage; and from Sungai Keroh to the Jinjang Pond.”
Ruben adds that flood control dams can also be constructed to retain flood water in order to protect areas downstream.
“The Klang Gates Dam is an example of a dam built for water supply but also serves as a flood mitigation dam.”
Where future infrastructure and roadworks are concerned, Ruben says flood diversion channels or tunnels can be built and serve as both a storm weather channel and a motorway.
“A good example of this is the Smart Tunnel system and this concept was believed to be the first of its kind at that time.”
Ruben adds that non-structural measures can be proposed where engineering means are not applicable or viable.
“Flood forecasting like telemetric warning systems and evacuation measures can be done for areas that are flood-prone to help homeowners mitigate any loss or damage.
“Guidelines and design standards can be prepared in specifying clear technical requirements for river reserves, as well as flood mitigation and urban drainage projects.”
