Separated by just the Straits of Johor, Johor and Singapore are familiar neighbors. However, their respective property markets vary significantly. For those considering purchasing a home in either location, it is useful to understand just how significantly prices vary, as well as how prices compare by neighbourhood. We compared available data in order to help inform these consumers.
How Do Median Transaction Prices in Singapore and Johor Compare?
In order to compare prices between areas Singapore and Johor, we compared the median sale price of homes in areas of each. To make a relevant comparison, we used pricing data for HDB resale flats in Singapore and and non-landed flats in areas of Johor with sufficient data. We found that homes are drastically more expensive in all areas of Singapore. This is even true when comparing more affordable areas of Singapore, such as Yishun, Ang Mo Kio and Woodlands to more expensive areas of Johor, like Johor Bahru and Iskandar Puteri.
To get a better sense of how much pricing varies in each neighbourhood, it is necessary to also consider the price in terms of floor area. Again, we found that prices per square metre were significantly more expensive in Singapore than in Johor. However, it is worth noting that after accounting for floor area, the overall rank of pricing changes. For example, Queenstown is the most expensive neighbourhood in Singapore in terms of median price per square metre, but not in terms of median sale price. Similarly, Johor Bahru is slightly less expensive than Tebrau in terms of price per square metre, though median transaction prices of homes in Johor Bahru are significantly more expensive.
How Can Singaporeans Purchase Residences in Malaysia?
While Singaporeans may jump at the very affordable flat prices in Malaysia, it is necessary to note that international buyers are restricted to purchasing homes that valued at a minimum RM 1 million (approximately S$329,000). In fact, the requirement is even higher in Johor, though foreigners can purchase at lower rates through the MM2H programme. This system requires foreigners to have at least RM 500,000 in their savings or checking account in order to purchase more affordable homes. Additionally, it is worth mentioning that most homeowners own their HDB flat at least 5 years before purchasing overseas properties, in order to meet the Minimum Occupation Period (MOP) requirement.
Malaysia My Second Home (MM2H) Requirements
|Age||Minimum Account Balance|
|Younger than 50 Years Old||RM 500,000 (Approximately S$165,000)|
|At Least 50 Years Old||RM 350,000 (Approximately S$115,000)|
What Kind of Flat Can You Buy for RM 1,000,000?
For Singaporeans limited by this restriction, it is worth asking: What kind of home could you purchase in Johor? After analysing non-landed properties listings on iProperty which were priced at RM1,000,000 (approximately S$329,000), we found that most of these properties were listed in Iskandar Puteri (Nusajaya) or Johor Bahru. Additionally, these flats and condos tend to be larger than nearly all HDB flats, with an average area of about 153 square metres and typically more 3 or more bedrooms and 2 or more bathrooms. Not only that, most of these properties also offered vehicle parking. Additionally, we found that a wide-range of large, landed-properties were available at this price, unlike in Singapore where landed properties tend to be dramatically more expensive.
Other Factors to Consider
While the relative affordability of Johor is a major attraction to both Malaysians and Permanent Residents of Singapore, price should not be the only factor for prospective home buyers to consider. For example, purchasing a home is a long-term commitment, especially for those utilising a home mortgage loan. Regardless of nationality, individuals must consider which areas they would prefer to live over the long run. For example, some prefer to live close to their family or to have a shorter commute to work. With that said, understanding the dynamics of each housing market can help consumers make a more informed investment when they purchase a home.