Developing demand driven rental strategy propsocial
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Following on from my last article on “Factors to Consider to Buy or Rent?”, I would like to share and highlight some tips about demand-driven housing, particularly focusing on renting. The focus in this particular article is on landlords, for tips on what could you do to get the ‘best’ tenant possible for your property.

1. Research and Identify Your Tenant Profile

Research around the areas where your property is located in (either through online property portals and forums or driving around the locations). It may also be useful in spending time in the local neighbourhood supermarket, local restaurants and other ‘hang out’ places for the locals to understand the population demographics of your area. After all, the social community element is an integral part where people choose to rent and buy.

Every geographical area and types of properties may attract different types of tenants. In certain industrial areas, there may be factory workers who are looking to rent certain properties located near their workplace and the requirements would be different.

For instance, Subang Jaya is quite an interesting suburb. Other than being known for the infamous Bubble Tea Street in SS15, it is also a popular area due to the strategic location and good transportation as well as being known for its large student population in that area. Hence, students in Bandar Sunway and Subang Jaya may have different types of property needs and requirements. If you are catering to young working adults, their budget and living requirements may also be very different.

2. Find out What They Are Looking For

Once you have identified the predominant tenant profile based on your property location, next would be to understand what your potential tenants are looking for.

Mass Market Strategy

If you are adopting a mass market strategy, one of the key parameters would be the types of budget range that the ‘mass majority’ in your identified profile are willing to pay and what would be their specific requirements?

Top Tier Niche Market Strategy

To illustrate, it would depend on your strategy as well, sometimes you may want to cater to the most unique (the needs of the top 20% of your identified profile to stand out rather than the mass majority). For example, if your property is in Bandar Sunway and Subang Jaya areas (well known as a University suburb many of the best top end private universities in Malaysia is located here such as Taylors University, Sunway University, Monash University, INTI University College and many others) and you have identified that most students in that area is willing to pay RM800 per month per person (which means if 4 person shares a 3 bedroom condo unit, it would be RM3,200 per month).

But instead of going for mass market, for example, if you want to only target the top 20% of international students who wants a very comfortable higher end accommodation with expensive furnishing and are willing to pay top dollar of RM1,200 per month per person (which means if 4 person shares a condo unit, it would be RM4,800 per month). However, you may need to calculate and assess the returns of investing additional capital to furnish the units to such high standards and whether such returns make financial sense.

Targeting Young Working Professionals

These thoughts and principles may apply to different segments. For me, as an investor and landlord, I also like to share some experiences in renting my condominium units in Kota Damansara to working professional tenants who have just joined the workforce. Some of my units are rented to young working professionals who are starting their first job in Klang Valley after graduation or those who have just joined the workforce in the last 2-3 years. Many of my current tenants are Malaysians who are originally from outside Klang Valley and are migrating to the Klang Valley to start their careers and jobs (due to the higher availability of jobs in the Klang Valley compared to other cities in Malaysia).

Based purely on my personal experiences in managing my rental condominium units in Kota Damansara for instance, a general profile of my tenants are those who are working as young engineers, architects, finance roles, marketing etc and their starting pay may be from RM2000 to RM3000, depending on their work experiences, job scope and company profile.

Statistics from various sources show a range, where in 2018 Bank Negara Malaysia shows a fresh graduates pay is from RM2,169.00 whilst Malaysia Employers Federation in the same year shows a fresh degree graduate pay starts from RM2,618.00.

Source: Jobstore

For my units, typically, these tenants may be aged between 22 to 28 years old and may be willing to spend about 25% to 35% of their monthly pay for their rental share in a shared condominium unit (which means if 4 to 5 person lives in a 3-bedroom unit, the rental range will be approximately RM2,000 to RM3,000 per month for an averagely furnished unit) in the suburbs of Kuala Lumpur City Centre (for instance Petaling Jaya, Damansara, Subang etc). A good tip would be to buy your units closer to or accessible to where good job opportunities are located.

Statistics provided by Numbeo infographics published by has illustrated some interesting information about average rental of 3 bedroom condominiums in KL City Centre.

From my personal experiences, some of these young professionals may not yet own a car as they have just started their career and would be willing to pay a higher rental premium to live close to Transit-Oriented Developments (TODs), where they will be able to walk 5–10 minutes safely to public transportation. They work for long hours and normally do no need much use of the kitchen other than a fridge and water filter but they would rank the need for high speed broadband internet to be higher, along with a clean, reasonably furnished room with weekly cleaning in the common areas. As long as the units are reasonably furnished with good lighting and clean paint, these are the factors that my tenant profiles are looking for.

3. What Are Your Competitors Offering?

When getting agents to assist you in renting out your units, do remember that you can also leverage a lot on the experiences of the numerous specialist agents covering your area. What makes a good real estate agent and how do you choose a good agent?

Since you are also paying a commission for their services, do engage them based on their profile of potential renters and also what are the conditions of the other units in your area. I also rely on their assistance to show me some of the other units for rental to allow me to gauge what my units are competing against in the area.

I always work together with my agents to ask their opinion on how to improve my units’ chances of securing the best tenant possible and I try to deliver the best value by giving ‘a bit more’ than what my competitors are giving. For instance, in between tenants, I always try to touch up the paint work, replace broken furniture and do some basic interior beautification (eg: some nice lighting at the entrance and some tasteful decor) to give my unit the best chance of success to secure the best tenant possible.

Even after a deposit has been paid to the agent, I always insist on meeting the tenants over a cup of coffee before the tenancy commences to understand their background and personalities before signing the tenancy agreement. This engagement would allow both sides to set their expectations to ensure a fruitful tenant and landlord relationship over the tenancy period.

4. How Do You Differentiate Yourself?

If the monthly rental of your unit is quite substantial and to differentiate your unit over others, many landlords engage the service of rental interior design companies who specialises in ensuring your new unit from the developer is fitted out and reasonably impressive enough to secure tenants as quickly as possible. Hence, do consider a simple interior design makeover tips targeted towards renting your unit as quickly as possible for the best price possible.

For longer term tenants, you may also try to incentivise them during renewal periods to try to lock them in for continuing a longer rental. The reason is that, every time where there is a change of tenant, you will likely need to incur some cost to rectify your unit for the next tenant, not to mention agent’s commission (typically 1% to 1.25% of the monthly rental). Hence, for continuing long term tenants, you can consider giving a half month rental rebate close to the end of the tenancy if they sign for a longer period of, say 18 months’ tenancy. This works on a win-win situation between you and your tenants.

Do pay them a face to face visit at least once or twice a year and do try to speak to them on the phone from time to time to keep up with changes in their lives. You will be able to find out about what’s happening in your condominium if there are any major issues with the property managers or if there are leakage issues, or even if your tenant needs something to be fixed, do try to do it as soon as possible to deliver the best value service as a landlord.

5. Its About People, Not Just the Property

Do remember that although property is physical, tenant management is always about people. People go through changing circumstances year-to-year, sometimes good and sometimes not so good. A long-term family tenant of more than 10 years may suddenly find themselves in a temporary tough situation if the breadwinner loses his job. On the other end of the spectrum, over the years they may get promoted and may be looking for an upgrade if you have it or purchase the unit from you where you may consider cashing out for a profit.

In Malaysia, the next 6 – 12 months will see many exciting initiatives unveiled by the Government to encourage people to rent, if they cannot yet afford their first home and then gradually move towards home ownership. Housing and Local Government (KPKT) Minister YB Hajah Zuraida Kamaruddin has mentioned that more Rent To Own ownership schemes will be announced in the near future.

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My point here, it is always a good idea to build a rapport and a good long-term relationship with your tenant as many people may not want to move once they are comfortably settled in, unless there are major changes in their lives.

Do enjoy the tenant management and landlord experience, else you can always get your friendly real estate agent or a property manager to manage your tenant for you if you do not have the time. 


So, all of the above are some of the ways on how you can develop a demand-driven rental strategy. Happy investing!

This article is contributed by former REHDA Institute general manager and property investor David Shieh Chong.

David Shieh Chong is an avid property investor who manages and co-owns more than ten properties, since 2009. He is passionate about real estate and relaxes during the weekend by viewing properties and keeps abreast with the property sector.

A corporate lawyer by profession, he has experience on various aspects of real estate, including in government real estate promotion at Malaysia Property Incorporated (under Economic Planning Unit Minister), real estate agency work and also has worked with top property developers at the Real Estate and Housing Developers Association (REHDA) Institute.

(13 August 2019)


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thanks for the research and info

Ck small

Very details and good info.I hope the gov will put the tenant profile consider part of ccris and cctos