Terraced Houses Expected to Outperform Other Residential Segments in Malaysia’s 2025 Property Market

Terraced houses are projected to be one of the top-performing property segments in Malaysia’s residential real estate market in 2025. Industry experts expect significant growth, with prices set to rise by up to 5% by the end of the year, outperforming other landed residential properties.

Irhamy Ahmad, a chartered valuation surveyor and the founder and CEO of Irhamy Valuers International (a part of real estate agency Juwai IQI), shared, "We expect up to 5% price growth in terraced houses by December 2025. This would make terraced houses outperform other property types, just as they did in 2023." Ahmad highlighted that terraced houses are widespread across Malaysia, particularly in Kuala Lumpur and the Klang Valley suburbs, making them a core part of the nation's housing stock.

Strong Past Performance and Projections for Future Growth
The anticipated 5% price growth in terraced houses represents a notable improvement compared to recent trends. According to the National Property Information Centre (Napic), terraced house prices increased by only 1.1% in the 12 months leading up to the second quarter of 2024. However, in 2023, the segment saw a 3.7% rise in prices, marking it as one of the strongest-performing residential segments of the year.

In comparison, high-rise units experienced a 3.6% price growth, semi-detached homes rose by 2.3%, and detached houses saw a modest increase of 1.4%. Over the long term, terraced houses have consistently outperformed other residential categories. Since 2010, terraced house prices have surged by 144.4%, significantly surpassing the overall house price index, which grew by 118.7% during the same period.

Affordability and Growth Potential
Despite their strong growth record, terraced houses remain more affordable than semi-detached and detached houses. The average current market price of a terraced house is RM453,343, compared to RM718,599 for semi-detached homes and RM643,387 for detached houses. High-rise properties are the least expensive, with an average price of RM367,201. This affordability, combined with solid price growth, positions terraced houses as a reliable investment.

Premium Corner Units
Within the terraced housing category, corner units are particularly in demand due to their larger lot sizes and unique layouts. Typically measuring between 3,000 and 3,500 sq ft, corner lots offer homeowners more outdoor space and greater flexibility for renovations. These homes, which often exceed the standard 22ft x 75ft (1,650 sq ft) dimensions, provide additional privacy with only one immediate neighbor.

Double-story corner terraced houses are especially prized in the market, as they offer ample renovation opportunities and increased space. In sought-after areas like Taman Tun Dr. Ismail and Bandar Utama, corner terraced properties command premium prices. Some homeowners even invest in adding a third floor to the typical two-storey structure, expanding the built-up area to over 4,000 sq ft.

Economic Factors Supporting Growth
The promising forecast for terraced houses in 2025 is not only driven by strong buyer demand but also by Malaysia’s overall economic conditions. Ahmad explained, "Our forecast for up to 5% growth in terraced house prices in 2025 reflects steady demand and favorable economic projections."

Malaysia’s economy is expected to grow by around 5% in 2025, supported by strong performance in sectors like manufacturing, trade, commodities, and construction. This growth, combined with Bank Negara's decision to maintain a neutral policy rate at 3%, will create favorable conditions for real estate. The 3% rate is expected to support stable borrowing costs while keeping inflation in check, projected to remain manageable at 2% to 3%.

Emerging Trends and Government Initiatives
Steady economic growth and stable interest rates generally translate into favorable conditions for both homebuyers and renters. Two key trends are expected to shape the residential property market in 2025:

Mixed-Use Developments: The demand for mixed-use developments, which combine residential, commercial, and recreational spaces in one location, is on the rise. These developments are increasingly appealing to buyers seeking convenience and an integrated lifestyle. Terraced houses, often situated in planned, amenity-rich townships, align well with this trend and are likely to benefit from it.

Affordable Housing Initiatives: The government’s focus on affordable housing, including new construction initiatives for homes priced below RM300,000, aims to make housing more accessible. While terraced houses generally fall outside this price bracket, the overall increase in residential supply and affordability initiatives will likely boost demand for various housing types, including terraced homes.

A Promising Year Ahead
Overall, 2025 looks to be a promising year for Malaysia’s residential real estate market, with terraced houses expected to see substantial growth. The combination of a stable economic environment, low borrowing costs, and increasing demand for community-oriented developments all support the growth potential of this segment.

Terraced houses have demonstrated resilience and growth across various economic cycles, and 2025 seems poised to continue this trend. With price increases of up to 5% projected, they are expected to outperform other housing types, making them a solid investment option. Whether due to their relatively affordable price points, lifestyle flexibility, or proven growth track record, terraced houses remain a popular and promising choice for homeowners and investors alike.

https://www.thestar.com.my/business/busines...terraced-houses

TLDR
- Terrance to grow by 5% in end of this year
- Corner Terrance unit is consider as premium unit like semi D.
- Two key trend in 2025 beside Terrance are the affordable housing (price below 300k) and mixed development which convenient and rich amenity township are the key

This post has been edited by Jazted: Nov 18 2024, 02:02 AM

Popeti 5%, not including bank interest, electricity bill, water bill, cukai pintu, cukai taksiran, management fee, repair cost, wear and tear cost, theft risk, vandalism risk, and tenant problem.

US ETF 30%+ yoy, zero maintanence.
EPF 5.5% yoy, zero maintanence.

Popeti is a liftsyle cost. Can buy to stay, never buy to invest.

In the future, we all can live in cage houses like in Hong Kong.

k are rich pipu, after retired all long term stay in 5 star hotel until die.

Much cheaper than to maintain popeti.

No need rich
Now have a trend of retired people stay full time on cruise
Much cheaper than retirement home

In certain cases or country, hotels are cheaper than rentig a house

please build more single story terrace house. nobody is fancy of climbing staircase at home, especially old folks.

If you can pay they can build .

Single storey occupy land size more than double. If single need 22 x 70" for comfort living, while retaining space for 3 bedrooms.

Double storey can easily squeeze to 18" x 65" or 20 x 60 since ground level are catered for living and dining. For developer profit and cost points of view, double storey is better than single store.

Also higher price per sqf if selling for double storey.

For triple storey might need foundation such as piling, so developer prefer to build low density high rise apartment instead.

This post has been edited by Jazted: Nov 18 2024, 10:23 AM

meanwhile house quality also going down because cut corners

every day also say naik naik naik

but if really sold, then same amount of money stay where?

If you managed to secure RM300 per night at Hard Rock, yes only RM100,000 per year.
Including buffet breakfast everyday yo



Can stay 10years for 1M budget

5% growth for terrace house is not decent actually