Rising development costs are driving property prices upwards in Penang, but affordable housing schemes may help Penangnites own their dream home.

Increasing economic development has driven up property prices in Penang, but the state government has taken measures to mitigate this and make affordable property accessible to Penangnites.

Penang is a remarkable state in many ways. With excellent medical facilities and connectivity, a vibrant cultural centre, delectable cuisine, and a wide range of enterprises, it has become the melting pot for residences, businesses, and investment opportunities. Its surge as an international tourism destination in recent years has been nothing short of being impressive. Based on a hotel survey by Tourism Malaysia, with a 45.63% increase in hotel guests from 4,502,099 (2013) to 6,847,569 (2014), Penang has the third-most hotel guests in Malaysia after Kuala Lumpur and Pahang, beating Johor, Sabah, Sarawak, Melaka, and other states.

Given Penang authorities’ ambition to transform Penang into an international intelligence city, no effort has been spared to drive development in Penang. Efforts are being made to enhance Penang’s transportation system and infrastructure, attract foreign investments, and training its local workforce, which could eventually drive the increase in population, as well as create demand for consumer goods and property in the state.

The surge in tourism and economic activity has resulted in a burst in growth for property prices, posing a challenge to Penangnites to own homes. However, the Penang state government had introduced several cooling measures since December 2013.

Cooling Measures

A moratorium for low and middle-income developments, where the state government will not allow certain types of properties to be sold within a certain period of time, was among one of those measures to prevent property speculators from buying those properties at a cheap price, and selling them two to three times higher than their original value.

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