High Speed Train in Malaysia free essay sample

Also to discuss the possible property investment opportunities that may arise along the high-speed rail (HSR). Under The Economic Transformation Plan, there has been a realisation in recent years that the country is, for various reasons, caught in a â€Å"middle-income trap† and to continue at the current pace of socio-economic development, it would not be able to realise Malaysia’s Vision 2020 of becoming a developed nation by the year 2020. The Malaysian economy which grew between 8% and 9% annually prior to the Asian Financial Crisis, has since 1997, grown annually at only between 4 and 5%. With this in view, the present government has begun to chart an ambitious and new economic direction and framework for Malaysia, and whilst it still includes Vision 2020 as the target for reaching developed nation status by the year 2020, the new elements in the proposed acceleration of socio-economic development includes the New Economic Model or NEM, the 10th Malaysia Plan or 10MP (2011- 2015), the 1Malaysia Government Transformation Plan or GTP, and the 1Malaysia Economic Transformation Programme or ETP (A Roadmap for Malaysia). The NEM was a result of the establishment of an independent National Economic Advisory Council (NEAC) to develop recommendation on the design of a new economic model. The Council’s report, released in April 2010, provided a diagnosis of the challenges and opportunities facing the Malaysian economy and recommends eight strategic reform initiatives. Much of this thinking has been built into the 10th Malaysia Plan and the Economic Transformation Programme. The 10MP outlines the Government’s development plan for the next five years. It focuses on unleashing economic growth, promoting socio-economic development, developing and retaining talent, building an environment that enhances the quality of life and transforming government. It identifies 12 National Key Economic Areas (NKEAs). The GTP is a commitment by the Government to better delivery of goods and services to the Malaysian public. It involves National Key Results Areas (NKRA’s) such as reducing crime, fighting corruption, improving student outcomes, raising living standards of low-income households, improving rural basic infrastructure, improving urban public transport and addressing cost of living. The ETP is a comprehensive effort that will transform Malaysia into a high- income nation by 2020. It will lift Malaysia’s gross national income (GNI) per capita from USD6,700 or RM23,700 in 2009 to more than USD15,000 or RM48,000 in 2020, propelling the nation to the level of other high-income nations. This GNI growth of 6 per cent per annum will allow Malaysia to achieve the targets set under Vision 2020. The starting point of the ETP will be the implementation of concrete changes in specific sectors and areas of the economy. Labs were established for each of the 12 NKEAs to determine specific initiatives and projects that would drive economic transformation. The 12 labs consisted of the private sector and the civil service and were facilitated by Performance Management Delivery Unit (PEMANDU). An NKEA is defined as a driver of economic activity that has the potential to directly and materially contribute a quantifiable amount of economic growth to the Malaysian economy. Of the 12 NKEAs, namely Oil, Gas and Energy, Financial Services, Tourism, Business Services, Electronics and Electrical, Wholesale and Retail, Education, Healthcare, Communications Content and Infrastructure, Agriculture and Greater Kuala Lumpur/Klang Valley, three of these, as highlighted, are more directly related to property investment and development. It would be obvious from this that there is a heavy reliance on the property market for the ultimate success of Vision 2020, New Economic Model, the 10th Malaysia Plan (2011-2015) and the Economic Transformation Programme (ETP). Greater KL was chosen out of many corridors because Greater KL produces one third of Malaysia’s wealth. Under the EPPs (Entry Point Projects) has listed nine components for Greater KL that is: i. Attract 100 world’s top multi national companies (MNC’s) ii. Attract high-skilled immigration iii. Connect to Singapore with high-speed rail iv. Build MRT: An integrated urban rail system v. Rejuvenate the river of life vi. Create greener KL vii. Establish iconic places viii. Pedestrian network ix. Solid waste management * Item no. 3 and no. is the major factor to boost and to make potential impact on property market as a whole. This will be discuss in the coming subject of this report to get better understanding of the potential impact and property investment which obviously will arise once the high-speed rail was determined to be built in Malaysia. 2. 0Definition of high-speed rail International Union of Railways (The UIC) define high-speed rail as generally equal to o r greater than 250km per hour. * Advantages of HSR 1)High capacity 2)Environmental respect 3)High safety * * The performance ) Commercial speed – travel with a high level of speed 2) Total time of travel – benefit a short travel time from door to door 3) Frequency – profit of a high level of available transports, that what signifies total travel time (in general, the half of the frequency is included in the total time of travel) 4) Reliability profit of a reliable system of transport, which works independent in nearly each case of weather. * 5)Accessibility you can enter a train spontaneous without long check in times, which supports you high level of flexibility. 6)Price * 7)Comfort there is a higher level of comfort (in terms of space, accelerations, noise, light, etc. ) than in the plane, bus, or a average car. * 8)Safety High speed trains are the safeties transport medium 9) â€Å"Freedom† during your trip, you can go everywhere and every time yo u want, else in the restaurant, to the lavatory, or only for promenade, seatbelts are not necessaries; electronic devices aren’t limited, etc. * HS advantages for Society 1)Offers high capacity of transport Up to 400,000 passengers per day Reduce traffic congestion. 2)Respects the environment Efficient use of land (1/3 motorway Energy efficiency (x 9 planes / x 4 cars). * 3)Helps economic development. * 4)High Speed Rail promotes logical territory structure and helps contain urban sprawl. HS Safety * Up today, no accident with injured passenger at more than 200 km/h. 3. 0HSR IN MALAYSIA The opening of a HSR station brings enhanced accessibility and fosters changes in the configuration of the land-use system of the urban area near the station and its immediate surroundings (Blum, Haynes, amp; Karlsson, 1997; Urena, Menerault, amp; Garmendia, 2009; van den Berg amp; Pol, 1998). The spatial organization changes to take advantage of the increased attractiveness of the newly-connected location, in a dynamic process where involving simultaneous and multilevel impacts in the economic, social and environmental spheres (Banister amp; Berechman, 2003; Vickerman amp; Ulied, 2009). The Kuala Lumpur-Singapore HSR has been highly anticipated ever since the Malaysian Prime Minister announced in September 2010 the instigation of the HSR connecting the two neighbours. Initiated by YTL Corp Bhd way back in the late 90s, this RM8bil to RM14bil project has so far received mixed views from the public. HSR has been operating long ago in our Asian counterparts especially in Japan, China, Taiwan and South Korea. For comparison, Chinas HSR network by the year 2013 will be at 6,000 km, exceeding Japans HSR network of 2,459 km. Year 2010, in the United States, Obama administration invested US$8bil in federal stimulus money to create 13 high-speed rail corridors and billions of dollars of new business and tens of thousands of jobs are expected to flow to four hub cities Los Angeles, Chicago, Orlando and Albany, NY where plans for major high-speed rail networks are located. It was reported at the Conference of Mayors that the benefits of travelling between 110 mph and 220 mph will mean better connectivity, shorter travel times and new development around train stations. The changes will create 150,000 new jobs and some US$19bil in new businesses by 2035. The rail network is also expected to spur tourism, give businesses a wider pool of workers to choose from and help grow technology clusters in cities. Similar to experiences in other countries, in Malaysia, HSR will also generate substantial economic benefit for both countries, particularly Kuala Lumpur City Centre and the Iskandar region. The availability of HSR will shorten the distance between Malaysia and Singapore in terms of travelling time, hence attracting a larger pool of market catchment to stay in Malaysia and work in Singapore or vice versa. Straddling around 400 km, the proposed HSR will reduce travelling time to Singapore to 90 minutes compared to existing trains, which take about seven hours. The significant reduction in travelling time will attract foreign companies to operate in Kuala Lumpur or Iskandar region. URUSBUDI TRANSPLAN shows that 200,000 â€Å"person trips† on a daily basis both ways. This means around 100,000 people cross into Singapore everyday and on the same day, they return back to Johor Bahru to return to their home. Singapore and Malaysia have officially agreed to build a high-speed rail link between Kuala Lumpur and Singapore by 2020 at a meeting between Singapore’s Prime Minister Lee Hsien Loong and Malaysia’s Prime Minister Najib Razak in Singapore on February 19, 2013. Upon completion, it will take only 90 minutes for travellers from Kuala Lumpur to reach Singapore and vice-versa. Both Prime Minister had said the high-speed train project was a strategic development to enhance bilateral relations between the two neighbours. Both sides were working closely to sort out the details, as the rail link was crucial to Malaysia and Singapore to further enhance their bilateral and trade relations. Transport Minister Datuk Seri Kong Cho Ha had said five new railway stations would be built in Seremban, Ayer Keroh, Muar, Batu Pahat and Iskandar Malaysia for the high-speed rail service. * The project will be a private-public one, with the link being built by private contractors with government infrastructural support. No details on the project costs were released. According to a feasibility study, the project costs would be between $ 2. 5 billion to $ 3. 7 billion, but rumours speak of a total cost of above $ 9 billion. Transport investment surely will be expensive but the impact from it will be much greater to boost our economy in year 2020 as a developed nation. (Source: Ho Chin Soon) From the above map, we can see the five railway stations will eventually boost greater potential impact along the way that is in Seremban, Ayer Keroh, Muar, Batu Pahat and Iskandar Malaysia. It will definitely change the way people live, work, doing business and save a lot of travel time and it’s also productivity for all to travel in a very convenience way without any hassle. It will also change the way socio-economy and cultural way of living. Transport investment for the people is a must nowadays since Malaysia will become one of the develop nation in 2020. This can be achieve by the strength of better transportation for the people to travel in a very quick time and making life more easier by having HSR. Average population in Greater KL is around 7 million (without illegal’s residents) and Singapore at 5 million, Iskandar Malaysia at 1. 4 million, Batu Pahat around 400,000, Muar around 250,000, Malacca State around 800,000 and Negeri Sembilan in 1 million people which means around 15. 8 million population and by 2020 the population will increase to 18 to 20 million. (Source : Ho Chin Soon book). Transport investment is needed to give better opportunity to property development along the corridor especially in suburban area to spread and making a stronger impact on Malaysian economy. 4. 0 POTENTIAL IMPACT IN PROPERTY MARKET * 5. 1 The Residential Sector Of The Property Market * From 2008 to the third quarter of 2012 the House Price Index recorded 30. 3% and CAGR was 6. 85%. The country wide All House Price according to the report from the National Property Information Centre (NAPIC)/JPPH was RM234,436 in the third quarter of 2012. If we match that against the average household income for the country as a whole at about RM4,000 a month, the number of times the price is, as compared with the annual household income, it is an acceptable 4. 89 times. * In 2012, Malaysia’s economy continued its steady growth in the order of 5% to 6% a year, a range that it has settled into since the Asian financial crisis of the mid-1990s. GDP reduced to 5. 3% in 3Q 2012 (2Q 2012: 5. 6%), and expect to growth 5% and 5. 5% in 2013. Growth trend in 4Q is projected to continue very much like 3Q and is expected to be domestically-driven, with the services sector expected to be the biggest contributor to the country’s GDP. * The Kuala Lumpur property market reported a total transaction value of RM17. 43 billion for 24,978 property units as of 3Q 2012, an increase of 1. 69% in terms of value against RM17. 14 billion (23,301 units) recorded as of 3Q 2011 whilst Selangor recorded RM75. 03 billion in value transactions and 35,097 property units. (Source: JPPH) * 4. 2The Industrial Sectors Of The Property Market Existing Supply The total existing supply of industrial properties in Kuala Lumpur and Selangor stands at about 5,160 and 34,751 units respectively. The total number of units has increased by 236 units in Selangor. The existing industrial properties are largely terraced factories comprising 73. 7% of the combined supply in Kuala Lumpur and Selangor. State| Type of Property| Existing Supply| Future Supply| Kuala Lumpur| | 2007| 2008| 2009| 2010| 2011| Q32012| Incoming Supply| Planned| | Terraced| 2,975| 2,975| 2,975| 2,975| 2,989| 2,989| 35| 0| | Semi-Detached| 457| 457| 471| 471| 471| 487| 35| 0| | Detached| 553| 553| 554| 554| 554| 554| 0| 0| Flatted Factory| 1,116| 1,116| 1,116| 1,116| 1,116| 1,116| 0| 0| | Industrial Complex| 14| 14| 14| 14| 14| 14| 0| 0| | Total| 5,115| 5,115| 5,130| 5,130| 5,160| 5,160| 70| 0| Selangor| Terraced| 25,599| 26,277| 26,310| 26,310| 26,357| 26,416| 2,090| 626| | Semi-Detached| 3,227| 3,313| 3,323| 3,399| 3,531| 3,669| 753| 653| | Detached| 3,956| 4,199| 4,218| 4,236 | 4,250| 4,283| 93| 728| | Flatted Factory| 270| 270| 270| 270| 270| 271| 0| 6| | Industrial Complex| 101| 101| 105| 106| 106| 112| 3| 24| | Total| 33,153| 34,163| 34,226| 34,321| 34,515| 34,751| 2,939| 2,037| Source: JPPH) Future Supply The future supply of industrial properties in the Klang Valley is largely in Selangor, with terraced factories making up the bulk. 2,037 units have been approved but have yet to commence construction. Kuala Lumpur, by contrast, has limited future supply with only 70 industrial units currently under construction. 4. 3Purpose Built Offices Office building development in Kuala Lumpur has evolved greatly since the 1960s, when the first buildings were completed. Modern buildings offer more intensive site utilisation, larger floorplates, superior mechanical and electrical specifications, improved security, green features and MSC status. Patterns of development have changed, with more development being undertaken in suburban areas, as securing building sites in the Golden Triangle has become difficult. Despite the strong supply growth in city-centre areas since 2009, landlords of new buildings have remained steadfast and (for the most part) held rents firm. The oversupply situation in the city-centre will eventually make itself felt; rents at some newer buildings are vulnerable, while rents at older, less highly-specified buildings may also decline as landlords look to fill space or retain tenants. The large amount of supply completing at KL Sentral may also impact upon the city-centre market, as this decentralised location represents a real alternative for city-centre tenants looking for new space. In 2012, the average transaction price of purpose built office space in Kuala Lumpur increased 9. % from RM821 per sq ft in 2011 to RM898 per sq ft in 2012. Office development in Kuala Lumpur has been somewhat irregular over the preceeding three decades, and a number of factors have contributed to this. Typically, the market goes through longer periods (5+ years) of oversupply (15%+ vacancy), followed by shorter periods (2-2 years) of undersupply, during which time there is relatively moderate rental growth. Existing Supply The cumulative su pply of office space in the Klang Valley stood at 87. 1 million sq ft as of 2012, up from 83. 34 million sq ft in 2011, an increase of 5. 48% y-o-y. Completions during the quarter include, the Grade A Integra Tower, which forms part of the Intermark development along with the Doubletree by Hilton Hotel, the recently-refurbished Vista Tower office building and a retail podium. The largest office development in the city which completed in 2012 is 840,000 sq ft net lettable area (NLA) Menara 3 Petronas followed by 777,000 sq ft (NLA) Integra Tower, located along Jalan Tun Razak. Although take-up in newly-completed buildings remains slow as a whole, a trend of MNCs relocating from older city-centre buildings to newer buildings has contributed to the improved occupancy rates in buildings such as GTower, Hampshire Tower and The Icon. Future Supply The supply of office space within Kuala Lumpur is set to grow sharply over the coming four years. While the bulk of this stock is to be located in suburban areas, the supply increases projected for the city centre will also impact the market significantly. Of the office space currently under development in the Klang Valley, around 73. % is to be located within Kuala Lumpur, with the remaining 26. 6% in other Klang Valley aeras. In total, over 24. 87 million sq ft of office space is under development in the Klang Valley. A factor to keep an eye on is the 2. 3 million sq ft of office space due for completion in KL Sentral over the next year, roughly one-third of which has been committed. For many tenants, KL Sentral rep resents a real alternative to the KLCC area, and any major movements out of the city centre and into KL Sentral could drive up city centre vacancy rates further. In the meantime, however, completion of three of the four major office buildings in KL Sentral has been delayed, suggesting that tenants would be hard pressed to move in. This should ease some pressure on the overall market, with landlords of existing buildings benefitting from the short-term lease extensions as well. Other upcoming offices in Kuala Lumpur are The Crest, Menara LGB, Menara Tun Razak (Tower 1) and CIMB Headquarters with expected completion this year. * 5. POLICY SET BY SINGAPORE GOVERNMENT BENEFITS MALAYSIA * * On Jan 11 2013, the Singapore government announced the revised rates under the additional buyers stamp duty (ABSD), applicable to purchases or residential property acquisitions. The ABSD had previously applied to Singaporeans buying their third residential property and permanent residents getting their second. The latest measure will affect its citizens, permanent residents (PR) and foreigners who buy property in the island republic. * A check with the Inland R evenue Authority of Singapore revealed that foreigners who buy residential property in Singapore will now be subject to pay the ABSD of 15 per cent of the purchase price, up from the previous 10 per cent. Singaporeans buying their second homes will be hit with an ABSD of seven per cent, while those with permanent residency status will pay an additional stamp duty of five per cent on their first home purchase. * * The Singapore government also announced a Seller’s Stamp Duty on industrial properties for the first time, to discourage speculative activity in the industrial market. These measures are calibrated to be tighter on property ownership for investment, as well as on foreign buyers† (source: the Inland Revenue Authority of Singapore). To discourage over-borrowing, financing conditions for housing have also been tightened. In addition, structural measures have been implemented to strengthen the policy intent of public housing and executive condominiums. * * Malaysia will become a preferred country for foreign property investors and is now the main focus after Hong Kong and Singapore imposed 15 per cent evies to slow down foreign investments that had overheated their property markets. These measures will very likely benefit Malaysia in general and specifically properties in the Iskandar region, as well as properties in KLCC. * * A survey carried out by iProperty revealed that Malaysia is fast becoming a preferred investment destination for Singaporeans. In the survey conducted among 2,099 Singaporeans, 42 per cent chose Malaysia as the number one destination for overseas investment, with Australia and the United Kingdom following close behind. Property chief executive officer Shaun Di Gregorio seemed to have the same view by stating investments from Singaporeans will only have a marginal impact on property prices here. Foreign investors will only form the 10 to 15 per cent of the buyers. (source: iProperty) According to CEO iProperty, this is a good sign for Malaysia’s property industry with external money coming in especially at a time when our domestic market is experiencing a credit crunch and liquidity. * Malaysia Property Incorporated (MPI) said only up to three per cent of property investors in Malaysia are foreigners. MPI agreed that the tightening of property investment regulations in Singapore and Hong Kong will like draw more foreign buyers to Malaysian shores. â€Å"Internally, Malaysia has also improved in the Doing Business 2013 report which would boost investors’ confidence in the country’s growth so this could help in attracting more foreign direct investment into the country and possibly translate into some property purchases,† (source: MPI). MPI also said a large portion of foreign property owners in Malaysia are Singaporeans. Many property developers from Malaysia, Singapore and others, Fiabci Asia Pacific and Fiabci Malaysia saying the same thing that are property development will rise and boost along the railway catchment area especially in Iskandar Malaysia. This will generate demand for services of various types and will eventually create more jobs, which subsequently will generate further demand and jobs. Population will surely increase and in regional income which eventually will affect local expenditures. While the occupation cost (gross rental rate) for prime office space in KL City Centre range between RM6 per sq ft (psf) and RM8 psf, the cost in Singapore range between RM25 psf and RM30 psf. Meanwhile, the current rental rate in Johor Baru, where most of the buildings are more than ten years old, range from RM1. 40 psf to RM3 psf. The low rental market in Johor Baru is hardly surprising as it is mainly domestic-demand driven. With ambitious Iskandar Malaysia initiatives coupled with various inve stment friendly policies, the HSR will further augur the Johor Baru office market, hence attracting more MNCs to operate in Johor Baru. Upon completion of the HSR, gross rental rate for new Grade A office towers in Iskandar Malaysia is expected to hover between RM4. 50 psf and RM4. 80 psf, 50% to 60% higher than the highest rate achieved in Johor Baru city centre. Formerly called the Iskandar Development Region and South Johor Economic Region, Iskandar Malaysia covers 2,217 sq km. It is three times bigger than Singapore and twice the size of Hong Kong. It will definitely bring more investors with a lower rental rate than KL City Centre and it’s a well-planned city concept to encourage more investment into it. * Meanwhile, average selling price for existing condominiums in Johor Baru range from RM230 psf to RM370 psf. Capital value for existing condominiums in Johor Baru registered mixed performance from as high as 23% growth while some even noted depreciated values by -19%. [emailprotected] Harbour registered the highest selling price at RM400 psf. These finding was done by Senator Datuk Abdul Rahim Rahman Exe cutive Chairman Rahim amp; Co. group of companies which strongly believe that HSR will add vibrancy to the high rise properties in Johor Baru. Current average rental rate at RM2 psf in Johor Baru is estimated to increase by 50% to 60% arriving at RM3 psf, which is still below Kuala Lumpur rental rates, averaging at RM4. 50 psf. Therefore, it is timely for the HSR to be in place as it will help improve demand from locals and Singaporeans for high-rise residential properties. 6. 0TOURISM FACTORS * The tourism industry has grown favourably, with tourist arrivals increasing from 5. 2 million in 1997 to 24. 6 million in 2010 in Malaysia and 10. 2 million to 11. 6 million in Singapore during the same period. The proposed HSR is also expected to create positive impacts to the tourism industry of both nations. With combined tourist arrival of about 35 million coupled with 90 minutes commuting time, Kuala Lumpur-Iskandar-Singapore will be able to position themselves as the transportation hub of South-East Asia as it will provide tourists a wider airline selection to choose from either in KLIA, LCCT or in Changi Airport hence, improving international access to the region. * * In year 2012, tourist arrivals were 25,032,708 and we received RM60. billion from it (source: Tourism Malaysia) and it will keep increasing with the new trend of transportation, with highest tourist from Singapore that is 13,014,268. * * * 7. 0MANUFACTURING IN MALAYSIA * * Manufacturing will remain as one of the sources of income to both nations. As land in Singapore is becoming scarce with limited land for expansion, coupled with escalating business costs, the HSR would enable some companies to expand or relocate to Ma laysia, particularly in the Iskandar region. Moving manufacturing activities to Iskandar Malaysia would allow the land to be used for even higher value activities. Malaysias relatively liberal immigration policies and substantially cheaper labour costs in Iskandar Malaysia compared to Singapore will reduce the operating costs. The relocation of manufacturing activities to Iskandar Malaysia via the availability of HSR is expected to raise the contribution of the manufacturing sector to the nations GDP by 6. 5%. * * The closer cross-border link between Malaysia and Singapore will eventually position the region as the first South-East Asian â€Å"mega region† similar to Tokyo-Osaka via the Shinkansen Bullet Train, and Shanghai-Hangzhou via the Huhang High Speed Rail among others. While it is noted that existing mega regions are within the same country under the same political driver, with strong political determination, deeper mutual understanding and putting aside all long-standing aggravation, Malaysia and Singapore can also materialise the idea. We should learn from the European experience; the Eurostar train link has helped to strengthen economic activities in both London and Paris. * * In essence, the HSR will economically benefit both nations and strengthen economic ties between the two nations. A larger joint economy will result in larger land area, larger population and larger market, offering greater economies of scale. In addition, larger joint economy with a more diverse mix of skills, types of companies, types of business activities and greater variety of business locations, could accommodate the diversity of talents, business activities, consumer preferences and skill sets. All this will be made possible via improved connectivity by the HSR, which has been proven to stimulate local economies and act as a driver of growth and thus help spur property prices. * * * 8. PROPERTY INVESTMENT OPPORTUNITIES * * According to KGV International Property Consultants executive director Samuel Tan, prices of residential properties have risen by an average 40 percent since 2006, in a city that used to suffer from a real estate overhang. He mentioned that the prices, which had been sluggish after the 1997 Asian financial crisis, started to see a rising trend due to a combination of fa ctors. The upward trend started in 2009, with the quantum leap occurring in 2011, when prices of upscale service apartments broke the ceiling of RM500 per sq ft and climbed into RM700 per sq ft. Many Singaporeans saw property in Iskandar Malaysia as a good investment for a holiday home and for capital appreciation, and not so much for rental yield. * * This development definitely has boosted interest in properties in Iskandar Malaysia. Residential enclaves in Bukit Indah, Setia Eco Gardens and Setia Tropika, all developed by the SP Setia Bhd Group, for instance, have foreign owners who buy the properties to live in, and not on speculation, according the group divisional general manager M. L. Hoe. * Looking at the Western Coastal Highway that leads to Nusajaya, the Southern Link to Masai and the Eastern Dispersal Link from the Pandan Interchange to the Customs, Immigration and Quarantine complex in the heart of Johor Baru. Given its well-planned infrastructures, amenities, catchment and accessibility, Iskandar Malaysia is a mine of low-risk investment opportunities. Of course, investing in projects by a reputable developer is a vital factor too. * * Places of interest such as Legoland, the Puteri Harbour theme park, and the education hub Educity, are added draws for foreign investors. * Iskandar Malaysia is a 20-year-plan, and changes are slowly but surely taking place. It is up to the local authorities to monitor the property sector to ensure that there will not be an over-supply in the future. * * Based from the several property developers and projects in Iskandar Malaysia shows one thing in common for both locals and Singaporeans are buying properties such as on-going launches project that is Teega, Medini Signature from Johor township which already achieved 80%-90% take-ups within weeks of launch. It shows no matter what is the result of GE13, buyers still keen to buy properties in Malaysia. * * A few finding from Kenanga Research shows that new launches of terrace/cluster homes in gated/guarded communities are being priced at RM700-850k/unit in prime areas of Johor while semi-D/bungalows are easily clearing RM1m level; this is almost a 40%-70% up from 12-18 months ago. Current pricing is narrowing towards average Klang Valley pricings compared to the past where Johor used to command steeper discounts of 25%-35% over the last six years. * According to the investment research house, the non-Nusajaya market is mostly driven by locals working in Johor (70%-80% of buyers), largely due to the quota of foreign buyers on landed properties (up to 30%). Additionally, Johorians prefer to stay closer to JB City to access commercial content and amenities. It describes this market as driven by sustainable â€Å"organic† population growth which is typically owner occupiers rather tha n investors. * * On the other hand, Nusajaya market (e. g. Puteri Harbour, Medini) enjoys ‘international lot’ status where there are no foreign buyers’ restrictions or Bumi quotas; foreign buyers comprises of up to 60%- 70% of buyers. Foreign buyers are currently heavily weighted on Singaporeans. In the next few years, we believe Nusajaya will see greater price speculation given the number of foreign buyers who typically treat their properties as investments or weekend homes. This will result in a greater push of capital values as seen with recent launches (e. g. Teega, Puteri Harbour @ ASP of RM750psf; Somerset, Puteri Harbour @ ASP RM900psf) while we understand high-end launches in the near future could be averaging between RM900-1200psf. This will totally boost the surrounding area with higher investment for any type of property and will give more stability in pricing. * * Research done by Kenanga also believes that good rentals will be achieved from a projected increase in professionals and consultants coming for short stays given the Pengerang oil and gas development and Motor City, as well as the exodus of Singaporean SMEs relocating to Johor’s Ascendas Industrial Park. * * 9. 0CONCLUSION * * Forward-looking planning has enabled the Government to capitalise on the country’s unique offering, including a rich heritage and scenic landscapes, to support a thriving tourism sector. Home to more than 15% of the world’s species, Malaysia is one of the world’s most bio-diverse areas. The current emphasis is on climbin g the economic ladder, and this is done via Government-led initiatives such as the Government Transformation Programme (GTP) and the Economic Transformation Programme (ETP), and a conscious effort to slowly liberalise sub-sectors of our economy. * Also crucial are a focus on building on the country’s vast natural resources, a commitment to economic openness, and a concerted effort to drive investments in infrastructure and research and development. These are complemented by the encouragement of innovation in business and amongst the workforce, and the development of regional alliances. * * Malaysia’s economy has been resilient amid the challenging global economic conditions; with real gross domestic (GDP) product growth was estimated at 5. 1% last year and 5% in 2013, according to the World Bank. * Its third-quarter performance 2012 surprised on the upside with GDP expansion beating economists’ median expectations of 4. 8%; year-on-year growth in the quarter was 5. 2%, with domestic demand fuelling economic activity and compensating for the slower export demand from major trading partners affected by the ongoing economic woes. Domestic demand in the third quarter 2012 continued to experience double-digit growth, increasing 11. 4% from a year ago. The impetus for this was supplied by strong public and private sector investment. Private investments were primarily driven by capital spending in the services sector, particularly in transportation, real estate and utilities, while public investments were mainly capital spending by public enterprises in transportation, oil and gas, education and utilities. * * The planning process for HSR extensions must include – as crucial elements of the decision-making process – consideration of both network efficiency and spatial equity issues (Brocker et al. , 2010; Puga, 2002). If HSR extensions are prioritized solely accord- ing to network efficiency objectives, their design will strongly de- pend on the extent to which HSR efficiently links major urban agglomerations. This approach implies a serious risk of creating the effect of spatial polarization, i. e. a negative impact on spatial equity (Lopez et al. , 2008). The spatial equity approach involves adopting a more strategic view, which addresses both the possible benefits and their spatial distribution. This requires an assessment of the effects not only on the cities in the HSR corridors with a HSR station, but lso on other cities outside the corridor, regardless of whether or not they have a HSR station. * * Economically, this southern state scores high for being able to attract investors, both local and foreign. This once dull economy is being transformed into a vibrant zone with the development taking shape in Iskandar Malaysia ensuring growth continuity for many years to come. From 2008 till the e nd of 2012, a total of 500,000 new jobs were created just in the Iskandar Malaysia development region, with the figure set to more than triple over the next five years, say experts. * Investments into the state totaled RM106bil from 2008 to last year. The country’s smallest economic corridor is targeting RM383bil in investments by 2025. The development that is taking shape in the south of Johor has impacted the economy positively, and the effect would be greater over the next five years. The spillover effects of the development would be felt in the entire state over the next 10 to 20 years, mentioned by Pulai MP candidate Datuk Nur Jazlan Mohamed in an interview with StarBiz recently. * The gross domestic product of the state is projected to be between 7% and 8% over the next 30 years, with all the developments planned to turn it into the metropolis of the south. Johor has been at the forefront of the country’s development via the Iskandar Malaysia economic projects. L ocated in the southern part of Johor, Iskandar, which spans 2,217 sq km and is three times bigger than Singapore and two times the size of Hong Kong, was mooted six years ago. It is divided into five flagship development zones – the JB City Centre, Nusajaya, the Eastern Gate Development Zone, the Western Gate Development Zone and Senai-Kulai. Several local and foreign investors have committed to developing different parcels and projects at Iskandar, whilst new ones are in various stages of negotiations to participate in the massive development. * * Datuk Jazlan also said several labour-intensive companies from Singapore had also relocated to Johor, even moving their employees to the state so as to reduce their overall cost as opposed to staying back in Singapore. According to data obtained from the Malaysian Investment Development Authority, Johor managed to secure RM35bil worth of investments in the manufacturing sector from 2008 to 2012, of which RM22bil were foreign direct investments and RM13bil local investments. During the period, a total of 92,106 jobs were created in the manufacturing sector. * * Instant demand for Johor properties will be achieve tremendously once the proposed HSR is functioning as planned. Even before HSR started to operate we can see a very good impact on property development, which will bring good fortune in Malaysia. This is also due to the two existing highways linking Malaysia to the island state already faced heavy congestion and it’s a perfect timing to built HSR to ease the heavy congestion faced by locals and Singaporean. * * Another crucial factor was for the authorities to craft a long-term asset policy that would not dampen interest from foreigners, yet prevent the kind of artificial inflation of prices caused by speculative buying. Our government is to set new policy to prevent all sort of unhealthy activities by speculators. * The recent Country Brand Index (CBI) 2012-13, ranks Malaysia as third among the Future 15 – tomorrow’s leading country brands that have â€Å"great potential across a variety of areas†. Constructed annually by global brand consultancy FutureBrand, the CBI measures and ranks global perceptions around the world’s nations based on elements such as their cultures, industries, economic vitality and public policy initiatives. Last yea r was the first time that the index report incorporate the Future 15, which reflects six future drivers: governance, investment, human capital, growth, sustainability and influence. It was published last October 2012, in the CBI 2012-13 report that: â€Å"Malaysia’s workforce, tourism and vast resources may just be the secret to its success. † * * A key component of the Malaysian success story has been the sound implementation of economic reforms since the nation’s independence that has transformed an exporter of raw materials into an emerging, multi-sector economy driven by exports and supported by a well-developed regulatory system. * * *