The name conjures a scene that isn’t far off from a Beverly Hills 90210 episode. Coveted address, luxury properties, uber-chic cosmopolitan society, utopian schools, fancy restaurants, and all the icing one would expect from an urban paradise.
Since its inception, Mont Kiara has maintained a prestige few neighborhoods can compete with. It has grown into a dense concrete jungle with access roads that are choking with traffic, yet, it appeals to a huge number of people.
If you’re reading this, Mont Kiara probably appeals to you too. You hear the naysayers’ criticism but you also see the amount of new developments mushrooming. You see the neighborhood expanding, swallowing up adjacent areas.
You’re wondering; is Mont Kiara a good investment?
Your observation tells you that Mont Kiara has too many condos but the investor in you feels money can be made here. The dilemma!
This post is meant to help you crush that dilemma. It will provide you with a thorough understanding of this area and give you reasons why Mont Kiara is a good investment.
Ready? Let’s go back to the beginning.
Mont Kiara History: 30 Years in the Making
Mont Kiara has come a long way from 30 years ago when it was the Segambut Dalam Rubber Estate. Purchased by Dato Alan Tong of Sunrise Bhd back in the early 90s and renamed Mont Kiara, the first condominium here was constructed in 1993 and named Mont Kiara Pines.
Mont Kiara Pines was launched at RM190 psf. In mid-2020, the median price psf here had risen to RM608. That's a 320% increase in 27 years. Not bad at all, eh?
Mont Kiara Pines was followed by the construction of Mont Kiara Palma. The new 400-unit development sold well.
The success of Pines and Palma, kicked-off a wave of other residential and commercial developments along Jalan Kiara, the main artery of Mont Kiara. Mont Kiara quickly grew into a highly sought after concrete jungle comprising mid to high-priced condominiums and a myriad of amenities to meet the needs of its upscale population.
Mont Kiara Property: Some Important Details
People have mixed feelings about Mont Kiara. Some people will tell you that it’s a great investment location and others will tell you stay away from it.
Therefore, we should ponder this question first...
Is Mont Kiara Still a Good Investment Area?
To begin answering this question, we need to look at another important question - what makes a good investment area?
A good investment area is a place where:
the market is equitable,
good amenities are within a 1KM radius,
access to job centers is good, and
demand is healthy.
Mont Kiara meets all the criteria above and therefore, is a good investment area.
Properties in Mont Kiara may not be better looking than the rest of Malaysia today but they have strong appeal for a multitude of reasons. If you have the moola (between RM740,000 to RM1,700,000), this beauty of a location is worth flirting with.
Some condominiums here now give among the best yields in Kuala Lumpur. According to iProperty, Kiara Ville and Mont Kiara Damai produced a rental yield of 10.6% and 6.6% respectively in 2017.
If you’re wondering what’s a good rental yield in Malaysia, it’s anything from 4% and above. The average rental yield in Kuala Lumpur has been declining and is below 4% now.
Since 2010, Mont Kiara prices have been stabilizing and may not have had the growth spurts of its more contemporary neighbors like Mutiara Damansara and Desa Park City but prices have been increasing nevertheless.
For example, in 2019, the median price psf for Mont Kiara Pines was RM586. By mid-2020, the median price had increased to RM608. That’s a 3.7% appreciation in less than a year. Not amazing, but sound.
This is expected of established and mature neighborhoods. Look at areas like Bangsar, Damansara Heights, Taman Tun Dr. Ismail, and Damansara Utama. You may not see steep appreciations here but they’re evergreen locations, charting a slow and steady rise with good demand.
Mont Kiara and the Market Slowdown
When it comes to investments, you have no guarantee of zero risk. But I can make one guarantee with certainty. That is; markets fluctuate - all economic markets have ups and downs.
If you’re in a growth period, you can bet on a slowdown coming.
Likewise, if you’re in a slowdown, you can be certain a growth period is coming.
If you buy any property on the heels of good fundamentals, you should not have to worry too much about these fluctuations.
We’ve established the fact that Mont Kiara is a good investment location. A market slowdown doesn’t mitigate this fact. It simply delays the inevitable benefits.
Despite a slowdown in the Malaysian property market since 2015, Mont Kiara remains a preferred location not just because of the property yields and trendy, and chic people from many cultures who throng the restaurants, malls, and pedestrian walkways. The combination of many ingredients like access to other townships, food choices, education, property choices, and accessibility add to the appeal.
Sure, many other locations in the Klang Valley have these ingredients too. But few do it like Mont Kiara. That’s not an exaggeration.
Segambut Mont Kiara
Demand for Mont Kiara has been good but the supply of land is limited. Mont Kiara has therefore been gradually expanding out of its borders. One area that this expansion has been encroaching on is Segambut Dalam.
Many condominiums have been or are being built along Jalan Segambut Dalam. This place is not in Mont Kiara but close enough and developers have leveraged the Mont Kiara brand to sell properties here.
The access road that is Jalan Segambut Dalam is narrow and poorly maintained. As you go along Jalan Segambut Dalam, you can tell that you’re leaving the affluence of Mont Kiara.
This may change in time.
Condominiums here are cheaper than those in Mont Kiara proper. They’re worth considering if you have a lower budget.
6 Reasons Why Mont Kiara Is a Good Investment
#1 The Mont Kiara Address Is One of the Most Sought After Addresses in Malaysia
Make no mistake, when it comes to an address that urbanites covet, Mont Kiara is literally at the top of the game. In Dec 2018, iProperty ran an article that said its listings on Mont Kiara may have been viewed over 12 million times in 8 months.
At an average 1.5 million views per month that was probably one of the highest searches for a neighbourhood in iProperty if not the highest.
In iProperty’s Residential Property Market Report (Klang Valley and Johor Bahru) as at December 2019, Mont Kiara was in the Top 10 listed and searched areas. In the same report, Mont Kiara was the most searched “for sale” area in the condominium category. It was #2 in terms of transacted area for condominiums.
Mont Kiara deserves this position. Development quality, appreciation and yield on properties here have been fairly good.
But, what about Mont Kiara’s density? Isn’t this a big put-off for people.
Mont Kiara may be a concrete jungle comprising many high-rise buildings but this is not necessarily a big negative. As dense as it may be, it doesn’t actually feel so crowded. The developments have been well planned.
Most condominiums here have been built on large tracts of land, so you get a feeling of space within these developments. In addition to that, the location is filled with pockets of commercial spaces that add to the list of amenities. You have schools, restaurants, shops, and malls. Basically, everything you need for a self-contained neighborhood can be found inside Mont Kiara.
The density has purpose.
The downside is the traffic. The entry and exit points out of Mont Kiara are bottlenecks that cause long traffic jams during peak hours.
#2 Large Numbers of Expatriates Are Buying and Renting in Mont Kiara
What do expatriates have to do with the attractiveness of the local property market? Well, a lot actually.
For any locality to have good capital and rental appreciation potential, the market has to be equitable there. This means that income and wages have to be growing in these areas which in turn translates to people being able to afford price increases in property.
So equitable markets mean room for appreciation in prices.
Many localities in Greater Klang Valley are bearable markets. Income and wages in these areas are not growing as fast and people can just afford their mortgages here.
The average expatriate salary package in Malaysia is RM51,546 per month. As a general rule of thumb, a tenant’s annual salary should be at least 40 times her monthly rent. Assuming the salary package is net to the expatriate, then she could technically afford a rent of up to RM15,000 per month.
What’s the rental rate in Mont Kiara? According to Knight Frank, between RM1.80 to RM3.80 per square foot. A 1,000 sf apartment at RM3.80 p.s.f is RM3,800 per month. Pretty equitable in terms of rent, no?