What comes to mind when you think about buying a property?
Chances are it’s the shiny marketing booklet of some fancy new condominium complex. Yet for all the marketing investment that goes into new developments, Malaysia’s sub-sale property market represents the largest share of the nation’s residential real estate market.
The question of choosing between a primary or secondary property is a crucial one when considering your own property purchase. So what is a primary or secondary property, and which is the best option for you?
What Is The Difference Between The Primary And Secondary Property Market?
The main difference between a primary and secondary property lies in the ownership of the property.
The primary market is a term used to refer to buying newly constructed properties.
That includes everything from a towering new apartment complex to freshly-developed landed properties. These properties are purchased directly from developers.
On the other hand, the secondary market refers to properties sold by a previous owner – often known as sub-sale properties. These are residential properties which were previously purchased from a developer and are now being resold.
How Big Is Malaysia’s Primary And Secondary Market?
According to the National Property Information Centre (NAPIC)’s Property Market Report for 2023, property transactions amassed 250,586 transactions, culminating in a worth of RM100.93 billion. This marked a 7.1% growth in value and 3.0% growth in volume compared to 2022.
Comparing the primary and secondary property sectors, of these 250,586 transactions, 21.5% belonged to the primary market, whereas 78.5% belonged to the secondary market.
Should You Buy A Primary Or Secondary Market Property?
If you’re on the hunt to buy some property, you might be wondering which of these two markets is best. The answer is… well, it depends!
Reasons To Buy A Primary Market Property
When you buy in the primary market, you enjoy the benefits of being the first owner of a property.
Think about how good that new car smell is, then multiply it into a car the size of an apartment! There’s something very special about being the first one to own your new home.
When it comes to big apartment developments, this first-owner feeling can also add some nice flexibility. If there are several apartments in the development on offer, you might be lucky enough to pick the one on your preferred floor, or with the best view.
That fresh new feel also means that the new property has a lot less work that needs to be done.
In most cases, you’re moving into a finished and polished property. While you might end up with a small list of defects for a developer to fix, you’re unlikely to need to rip out the entire kitchen and start again like you might with a sub-sale property. That standard warranty period from a developer for a new home is a strong selling point for some.
The fresh property itself isn’t the only benefit. Fresh developments mean fresh amenities.
It’s nice to know that the infinity pool on the highest floor is quite literally in top condition, or that the new gym includes state-of-the-art equipment. Check out these new properties on Mudah.my to see what we mean!
Another advantage of the primary property market is buying directly from developers which can unlock other benefits. Developers often like to offer sweeteners to the deal, such as rebates or cash back on deposits. You might even be able to negotiate to get a few extra goodies thrown in.
If you’re looking at the long-term game of a return on your investment when you sell the property, those financial incentives that drive the cost down at the start can be a strong motivator. That’s why some people argue that a primary property can be a better investment opportunity.
Reasons To Buy A Secondary Market Property
A sub-sale property has its own set of unique benefits. It adds a certain ‘try before you buy’ that you don’t often get with primary market properties.
The benefit of secondary market property allows you to get a real feel of the neighbourhood and a lived-in experience of the house. Sub-sale properties are likely to be located in mature neighbourhoods, giving you a good understanding of the community you will be living in and potentially be a part of.
From a financial perspective, that experience can also add some certainty to house price valuations. The guide valuation price for a house is based on a comparison between similar properties and sales, balanced against various other factors.
While the condition of sub-sale property can vary, you can still put together a good picture of what similar properties in the area have sold for. You can also get a better picture of potential rental prices if you’re thinking about letting out your property.
Another big advantage of a sub-sale property is the house already exists! Many primary property developments sell in the construction phases, which means a lengthy wait of up to several years before you move into your new home.
With a sub-sale property, you might only have to wait a few months until the legal documents are completed.
Primary Vs. Secondary Property: Which Is Better?
Let’s recap the unique benefits of buying property from a primary or secondary market!
|
Primary Market |
Secondary Market |
| You get to be the very first owner of the property | Located in mature neighbourhoods with great convenience |
| The option to choose your preferred unit or view | Gain a deeper understanding of your community and neighbours |
| Minimal renovation or construction work to be done | Adds certainty to house price valuations |
| Warranty period from the developer for added assurance | Quicker to move in compared to new properties |
| Exclusive rebates, discounts, or freebies |
Competitive prices based on the condition of the property |
Whether it’s a brand-new condominium in the city or a cosy terrace home in a family-friendly neighbourhood, be sure to research your options through and through as buying a property is a huge step!
Nevertheless, it’s also important to determine your short-term and long-term goals when buying a home. Be it for investment purposes or to put down your roots, a home is more than just a shelter over your head, but is an asset and a place to belong.
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