Millennials expected to buy more homes

KUALA LUMPUR: Millennials purchasing residential property in Malaysia have significantly increased compared to last year and the trend is expected to continue rising until 2024, says Juwai IQI in a survey.

The Asian real estate technology company said its Millennial Homebuying Survey also indicated that the majority of real estate agents believed that there were more millennial buyers in the market today than in 2022.

“Some 80% of the agents believed that the number of millennial buyers is higher than in 2022, while only 4% believed the number has decreased.

“At least 73% of agents believed there are more bumiputra millennial buyers in the market today than in 2022, compared with only 7% who believed there are fewer,” said Juwai IQI’s head of bumiputra segment, Muhazrol Muhamad, in a statement.

Millennials are those aged between 27 and 41 and are sometimes also known as Gen Y.

They are the most important group of real estate buyers and also account for 50% of the country’s working age population.

On market share, Muhazrol said agents believed that millennials made up between 40% and 60% of all buyers, depending on the submarket.

“They are important because they are relatively big spenders and account for a large share of sales in the middle and upper-middle market segments, with more than three-quarters spending more than RM500,000,” he said, Bernama reported.

Bumiputra millennial buyers are skewed towards a slightly lower price range compared with other groups.

In terms of price range, 40% of bumiputra millennials opted for units priced between RM300,000 and RM500,000 versus 26% among other non-bumiputra millennial groups.

Millennials preferred condominiums (33%), followed closely by landed properties (30%) and serviced apartments (26%), said Muhazrol.

Not many millennials purchase commercial properties (11%) because they require a greater investment and a more sophisticated understanding of the markets.

The most popular programmes were Skim Rumah Pertamaku, followed by PR1MA Homes, the BNM My First Home Scheme, and the Home Ownership Campaign.

The statement said the most difficult obstacle to overcome was gathering enough money for a downpayment, which explained why Skim Rumah Pertamaku was the most popular among millennials, since it enabled buyers to finance 110% of the property’s value.

Muhazrol added that millennials picked a central location and access to public transportation as their two most popular features, followed by security features such as gates, locks, cameras and security guards.

Other important features include a swimming pool, gardens and outdoor areas, with gymnasiums being the least important.

The views of more than 20,000 real estate agents were sought in the March 2023 survey with a completion rate of 2%.

It was conducted online with a self-complete-style interview.