Penang is a bustling town and island located in the north side of Malaysia. As a tourist spot, it is phenomenal, with a plethora of good food and comfortable places to stay in. However, how is Penang real estate as an investment?
Let’s explore Penang from 11 different angles!
1. Strategic Location
Penang is a Malaysian state located on the northwest coast of Peninsular Malaysia, by the Malacca Straits. It consists of two parts, Penang island, where the capital city, Georgetown, is located, and Seberang Perai on Peninsular Malaysia.
Both are connected by Malaysia’s two longest road bridges, the Penang Bridge and the Sultan Abdul Halim Muadzam Shah Bridge; the latter is also, as of May 2019, the longest bridge in Southeast Asia. With the border of Kedah to the north and the east and Perak to the south, Penang is the second smallest Malaysian state by landmass.
2.Population
Penang boasts an estimated population of 1,774,400 as of 2021, has the 3rd highest population density of all Malaysian states (excluding Kuala Lumpur and Putrajaya), at 1,774.4/km2. It is also one of the country’s most urbanised states.
3.Rich in Diversity
4.Strong GDP Growth
Known as the Silicon Valley of the East for its industries, Penang is one of Malaysia’s most vital economic powerhouses. Penang has the highest Gross Domestic Product per capita among all Malaysian states and is considered a high-income economy. Therefore, penang real estate is always well sought after.
Moreover, Penang recorded the nation’s third-highest Human Development Index, after Kuala Lumpur and Selangor. Correspondingly, the state has a relatively well-educated population, with a youth literacy rate of 99.5% as of 2020. Furthermore, Penang consistently records one of the lowest unemployment rates within the nation, 2.1% as of 2019.
Penang is a hotspot destination for foreign investors in Malaysia; the state held the largest share of Malaysia’s foreign direct investment (FDI) in 2017, gaining nearly 0.4% of the nation’s overall FDI.
Furthermore, Georgetown was ranked Malaysia’s most attractive destination for commercial property investment in 2016, surpassing even Kuala Lumpur.
Penang’s FDI is mainly originated from Switzerland, Germany, Hong Kong, the Netherlands, Ireland and Singapore. It is an attractive destination for FDI as it continued to receive investments during the Covid 19 outbreak in 2020, where it received the second-highest level of investment in Q1 2020.
Penang is home to a sizeable expatriate population, especially from Singapore, Japan and various Asian countries, and other Commonwealth nations. Almost 9% of Penang’s population consisted of foreigners, reflecting its well-established allure of Penang amongst expatriates.
Most expatriates settle within the vicinity of George Town, the city’s northern suburbs, which is home to Tanjung Tokong, Tanjung Bungah and Batu Ferringhi.
7.Culture
Penang has a unique culture diversification with a multiracial society where Indian, Chinese, Malay, and some remnants of English colonialism remain.
It also includes a diverse multi-religion society where Buddhists, Muslims, Christians, Catholics, Hindus and more are gathered, multilingual society with English, Malay, Mandarin, Tamil, Hokkien, Teochew, Cantonese, Hakka is widely spoken in the state.
Penang has long been famed as the Silicon Valley of the East and the Pearl of the Orient. The former stems from our robust manufacturing background that contributes to 46% of the state’s gross domestic product (GDP).
Meanwhile, our services sector, mainly driven by the tourism industry, has provided significant employment and economic opportunities – surpassing the manufacturing industry by recording a GDP of 49% during the pre-pandemic era. UNESCO designated Georgetown in 2008 as a World Heritage Site; thus, every July 7th is regarded as a public holiday in Penang.
Penang is home to many attractive cityscapes such as glorious boutique hotels restored from dilapidated colonial buildings, skyscraping condos are mushrooming along Gurney Drive, and its fantastic array of street food and vibrant cultural attractions.
In November 2020, Penang was named as one of the “11 Best Islands for Retirement Abroad” by International Living, a website that covers global retirement or relocation opportunities.
The state came in third place after Malta and Mallorca, Spain, making it the first in Asia.
According to the future Penang Transport Master Plan, a Light Rapid Transit line, monorail lines, tram lines, and cross-strait cable car lines linking Penang Island and the mainland were recently proposed.
Penang International Airport serves as the primary airport for northern Malaysia, with frequent links to major regional cities like Kuala Lumpur, Singapore, It is also Malaysia’s second-heaviest cargo traffic and recorded all Malaysian airports’ third highest passenger traffic. The Port of Penang, the main harbour in northern Malaysia, is the third-busiest seaport in Malaysia, handled more than 1.52 million TEUs of cargo as of 2019.
Penang had a recorded broadband penetration rate of 80.3%, the highest among all Malaysian states. Penang is also the first Malaysian state to provide its citizens with free internet connections. Penang Free Wi-Fi, launched by the Penang state government in 2008, aims to boost internet penetration throughout Penang and is provided free-of-charge.
In 2020, Georgetown made it onto “ The 10 Best Destinations for Digital Nomads” list. With the work from home (WFH) culture taking root, many are now prioritising a reasonable cost of living, adequate co-working spaces, and reasonable access to Wi-Fi.
Types of Real Estate in Penang
Penang real estate can be divided into residential and commercial. There are condominiums, apartments, flats, terrace houses, semi-detached houses, bungalows, townhouses, and courtyards for residential real estate.
For commercial real estate, there are office spaces, shop houses, shop lots, retail lots, SOHO, retail complex, shopping malls, commercial buildings, land, factories, warehouses, hotels and islands.
However, it depends on the objective of the buyer. For residential, whether for own stay or investment. For commercial, whether for own business usage or investment too. The price of a residential unit could be below RM300,000 affordable category right up to above RM 5 million or even higher luxury category.
The same goes for the commercial team, which may start as low as below RM200,000 but can go up to above RM20 million. Location is one of the main factors that determine the pricing of real estate in Penang.
Check Out These 5 Hot Spots in Penang For Real Estate Investment!
1] Timor laut [North East District]
This district covers the northeastern half of Penang Island. It is where you will find much of Penang Island’s major tourist attractions, such as the Penang Botanical Gardens, Kek Lok Si Temple, and Penang Hill, the “green lungs” on the Island.
As a historic location, Timor Laut is great for families with all the amenities needed nearby, plus easy access to the mainland via the first and second Penang Bridge. Here are some developments of interest here:
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A] Tanjung Tokong, Tanjung Bungah and Batu Ferringhi
These areas are popular among international foreign buyers as residential and holiday homes. The Marin, Tropika Ferringhi, Ferringhi Residence, Ferringhi Residence 2, Quayside, Tamarind, Straits Residence and Alila 2 are among the highly sought after real estate projects. These internationally well-known tourist destinations have beautiful Seaview, hill/city view with natural surroundings that allow you to easily access local hawker food, high-end culinary delights, to a host of recreational activities for all ages. Amenities nearby include international primary and high schools, private hospitals, commercial hubs such as cafes, restaurants, hotels, and banks. B] Gelugor
Gelugor is located between Georgetown and Bayan Lepas. This area offers convenience and great access to schools, higher learning institutions, malls, banks, post offices. FInally, it is ten minutes away from the first Penang bridge and second Penang bridge.
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2) The Light City
The Light City is home to future convention centres, shopping malls, medical centres, condominiums will be established at the waterfront; Mezzo, Triuni, Vilaris Courtyard, Middleton, The Sun, Montage and so on.
3] Bayan Lepas
Bayan Lepas is located to the southwest of Penang Island, and is regarded as one of the most developed cities in Penang. It includes the Bayan Lepas Free Trade Zone, making it a major industrial hub.
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A] Queens Waterfront An exclusive waterfront freehold development constructed mostly on reclaimed land expected to be fully operational in 2022; amenities nearby include petrol kiosks, post offices, banks, clinics, convenience stores, schools, shopping malls and healthcare facilities. International schools, sports centres and shopping malls. B] Other residential projects such as Quay West, Havana Beach Residence affordable range, One Imperial, Imperial Grande, Tree O and Valentia Residence. |
4] Georgetown
Georgetown is listed as a UNESCO World Cultural Heritage Site in 2008. It has a rich history that is reflected in well-preserved colonial buildings and multiracial Malay, Chinese, and Indian architectural styles. In addition to the vibrant arts and culture scene, it is easily accessible to healthcare facilities, public transport, financial and educational institutions.
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A] Marriot Residence
B] 22 Macalisterz |
5] Batu Kawan, Butterworth, Bukit Mertajam are popular for mainland Investments
With the extension of the HOC Home Ownership Campaign to 31/12/2021, this is definitely the best time to buy property in Penang.
This article was written by Cindy Teh.
Ready to chase after the Penang real estate investment hype? Contact us and we’ll give you all the help you need to get started!
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