Affordable Cheras South attracts the young

AS one of the oldest residential areas in the Klang Valley, Cheras is saturated with homes, making development parcels almost unavailable. Developments have since moved southwards towards Balakong in Selangor, and a slew of new developments there are being marketed as “Cheras Selatan” or “Cheras South”.

As this name is without official sanction, it is difficult to say where the borders of Cheras South are. The general perception is that Cheras South mainly covers the Selangor side of Cheras, from the seventh to the 11th mile of the Cheras-Kajang Expressway, including neighbourhoods such as Bandar Damai Perdana, Bandar Tun Hussein Onn and Bandar Mahkota Cheras.

The Cheras-Kajang Expressway has also distinctly separated Cheras South into two parts, where Aeon Co (M) Bhd has stamped its presence with Aeon Mahkota Cheras on the east side, and Aeon Cheras Selatan on the west side.

Better amenities and improved accessibility via highways in Cheras South have encouraged more people to settle down in the locality, says JS Valuers Research & Consultancy Sdn Bhd executive director, Chan Wai Seen.

Accessibility

“It is a natural process, as rising property prices and land scarcity in Kuala Lumpur have driven more people to Cheras South as well as Kajang,” Chan says. “The upcoming MRT line and Kuala Lumpur Outer Ring Road (KLORR) are definitely factors that will contribute to growth in Cheras South.”

The proposed KLORR is an orbital ring road in the greater Kuala Lumpur area that will controversially cut through several forest reserves. It is an alternative route to the congested Middle Ring Road 2 (MRR2) and will link Rawang to Cheras.

Also accessible via Sistem Lingkaran-Lebuhraya Kajang Sdn Bhd (Silk Highway), this is an established area with amenities such as hypermarkets, shopping malls and hospitals, making Cheras South a self-contained area.

Director of Metro Homes Sdn Bhd, See Kok Loong, notes that the MRT Sungai Buloh-Kajang Line will run along the Cheras-Kajang Expressway and would help alleviate traffic in the area. It is expected to be the main mode of public transport there upon completion.

“It will change the landscape of this area and draw more young people to live here,” he says.

Currently, residents in Cheras South are mostly owner-occupiers. There are also students and factory workers given that several education institutions and factories are located in the vicinity, such as a Universiti Tunku Abdul Rahman (Utar) campus and Masterskill College of Nursing and Health.

Chan says land-use zoning has also allowed for industrial factories in certain parts of Cheras South.

Property agent at Vestcom Realty, Jackson Yong, says residential properties in Cheras South are a good rental investment option.

“There are many factories, especially at the Balakong area, so houses nearby can be rented out to the workers,” he added.

Earlier developments in Cheras South are mostly landed homes or low and medium-cost, non-landed developments. As large land tracts are getting scarce, the area is seeing more higher-end, non-landed residences catering to the middle-income group. These projects are found on pockets of land scattered around different parts of Cheras South.

According to data by theedgeproperty.com, prices of non-landed properties in Cheras South appreciated steadily from 2012 to 2014, but the properties here are still far more affordable than in most other parts of the Klang Valley.

The average transacted price per square foot (psf) for non-landed residential property in this area rose 13.8% year-on-year (y-o-y) to RM241 in the third quarter of 2014 (3Q2014). The growth may be partly attributed to newly completed projects like Livia Residence, Mahkota Residence and Suria Court. These new developments have benefitted the older properties by raising average prices across all existing projects.

Affordable mid-range homes

However, as non-landed residences in Cheras South are primarily low-cost apartments and flats, data by theedgeproperty.com shows the average transacted price for this property type in Cheras South was RM205,000 per unit in the 12 months to 3Q2014.

In the same period, the RM100,001 to RM200,000 price range accounted for the largest market share of transactions at 34.1%, followed by the RM200,001 to RM300,000 price range at 33.1%. Secondary market sales are yet to breach the RM500,000 level. On a psf basis, about half (49.5%) of transactions were below RM200 psf, while 48.7% were between RM201 and RM400 psf.

Livia Residence is an exceptional case for Cheras South, fetching an average price of RM520 psf in the 12 months to 3Q2014, making it the most expensive non-landed home by average price psf in Cheras South, based on data by theedgeproperty.com.

Located just next to Aeon Cheras Selatan, Livia Residence is a 20-storey serviced apartment block that houses 190 units. It is part of C180, a mixed-use development by Mitraland Bhd consisting of apartments, shops, entertainment complex, hotel, corporate offices, business suites, offices and showrooms.

The next-most expensive project was Mahkota Residence (RM326 psf). A fairly recent completion in Mahkota Cheras, it is also part of a mixed-use development project of shop offices, apartments and condominiums. This development was also one of the most popular properties in Cheras South, with 37 transactions observed in the one-year review period.

Metro Homes’ See notes that the high-rise residences in Cheras South currently cater for mainly younger buyers, with a ceiling price of around RM500,000.

Data analysed by theedgeproperty.com shows that the most expensive non-landed residence in Cheras South was priced below RM400,000 in 3Q2014. The most expensive non-landed residential property in Cheras South by average transacted price was Mahkota Residence at RM382,211 in 3Q2014, slightly higher than Livia Residence at RM348,222.

Livia Residence is cheaper than Mahkota Residence as the former consists primarily of 1 and 2-bedroom units of between 551 and 853 sq ft, while units at Mahkota Residence are mostly 3-bedroom units of between 1,066 and 1,222 sq ft.

Suria Court and Vistana Mahkota were the next-most expensive non-landed residences by average transacted price and average price psf in 3Q2014.

With an average price psf of RM301, Suria Court was selling at RM340,364, while Vistana Mahkota was priced at RM278,706 or RM291 psf.

Meanwhile, the least expensive non-landed homes by average transacted price in Cheras South are older low and medium-cost apartments and flats. The least expensive project is Taman Damai Jaya Flats (RM56,222), which is at least 30% cheaper than the next project, Taman Minang Flats (RM85,000). Taman Damai Jaya Flats is also the second-cheapest project by average price psf at RM125 psf, after Pangsapuri Kasturi Mewah at RM123 psf. Units at Taman Damai Jaya Flats are compact two-bedroom units of just 517 sq ft.

New supply for high-rise developments in Cheras South in the next three years include two phases of serviced apartments – You Residence and You Vista – in the 20.6-acre freehold mixed-use development You City by PJ Development Holdings Bhd.

These two phases were launched in 2012 at a starting price of RM550 psf, and will offer over 1,000 serviced apartment units upon completion. Located near Taman Suntex MRT station, You City will have a shopping mall and a total of three serviced apartment blocks.

Another upcoming project, Green Residence in Taman Rasa Sayang, comprises three blocks of condominium towers built on top of a multi-storey parking podium. Launched by Binastra Group at RM588 psf in 2013, each tower will consist of 180 units.

Windows on the Park, meanwhile, is a condominium development launched by SDB Properties in 2012 at RM580 psf. Soon to be completed, this development in Bandar Tun Hussein Onn consists of three blocks of high-rise condominium with 540 units.

Outlook

As developments continue to move southwards to Kajang and Semenyih, property experts are generally optimistic on the outlook for Cheras South due to accessibility via the Cheras-Kajang Expressway, Silk, KLORR and the MRT Line.

See believes that this area is also more attractive to homebuyers and investors compared with Kajang and Semenyih, as it is nearer to Kuala Lumpur city centre.

“I believe it will do well in the next two to three years once the MRT line starts operations in 2017.”

Vestcom Realty’s Yong, meanwhile, expects property prices in Cheras South to rise after the completion of the MRT line.

“Also, land is getting scarce here but demand is still going strong because the properties here are affordable and the young generation which has stayed in Cheras wants to continue to stay here after they get married,” he says.

Start your search for a Cheras condominium.

This story first appeared in The Edge Property pullout on Oct 2, 2015, which comes with The Edge Financial Daily every Friday. Download The Edge Property here for free.