How Singapore’s retirement plan and social demographics are shaping Iskandar’s Success
One significant trend that is very positive for Iskandar Malaysia is Singapore’s aging population. According to Singapore’s Department of Statistics, there will be 900,000 residents aged 65 years and over by 2030 in the city state.
This effectively creates two outcomes. The first is that Singapore, with its low birth rates and an aging society, will have to continue its policy of population growth via immigration – thereby increasing population density on the island and reaching 6.9 million by 2030. Singapore is currently the 3rd most densely populated country in the world according to government statistics.
The second outcome is how Iskandar Malaysia has become an option for Singapore’s elderly who are planning their retirement. The median age for Singapore today is 40 years, and much of the real demand for properties in Iskandar Malaysia has been by the country’s older population. Many here are sitting on cash savings of SGD100,000 to SGD200,000, and yet are not able to buy a second or third property in Singapore due to tighter lending rules and higher stamp duties for 2nd or 3rd properties. Hence buying a property in Iskandar Malaysia becomes a viable option because of the affordable pricing and proximity to Singapore.
Property in Iskandar Malaysia can serve as a potential retirement home as well as an investment. Those who buy properties in far-away locations such as Australia cannot possibly expect to retire there unless they emigrate, thus weakening links to Singapore. Or else if they choose to retire there, they must be able to afford the higher cost of living in Western countries. Iskandar Malaysia however is a practical retirement option to enjoy both Malaysia’s lower costs of living, spacious homes; and also to enjoy Singapore’s family ties, convenience and a sense of familiarity.
Healthcare options in Malaysia are attractive
Healthcare is one promising area for Iskandar Malaysia as the Singapore consumer gets older, richer and better informed. Healthcare costs in Malaysia are 30% to 50% cheaper than in Singapore plus, Iskandar Malaysia is also just an hour’s drive from most parts of the city state. The local market is also significant and growing as Malaysians living in Iskandar Malaysia – many of whom work or do business with Singapore – become more affluent as well.
Private healthcare in Iskandar Malaysia is developing fast with big plans on the cards. Gleneagles Medini hospital by Singapore listed Parkway Health opened in October 2015 and is emblematic of the growing private healthcare industry.
Other private players include Singapore based Thomson Medical, US-based Columbia Asia, Singapore operated Regency Specialist Hospital and Malaysian listed KPJ Healthcare. There are also numerous smaller operators that cater for another tier of the healthcare market – nursing homes and privately managed retirement villages.
A little known fact is that Singaporeans can use their Central Provident Fund (CPF) Medisave in selected accredited hospitals in Malaysia. This is another cost saving factor when accessing healthcare in Malaysia and it is encouraged by the Singapore government.
Another opportunity is healthcare tourism – with Indonesians being the largest group of medical tourists in Singapore and Malaysia today. Private hospitals in Singapore’s Novena and Orchard Road do big business in this segment and as more options open up in nearby Iskandar Malaysia, there is an opportunity to tap into the same trend.
High Speed Rail (HSR) and Rapid Transit System (RTS) will improve links
Travelling between Singapore and Iskandar Malaysia today can be a big hassle. Thousands cross the border daily, with Malaysians going into Singapore during the morning rush hour and then heading back home in hordes in the evening. Traffic jams on the Causeway and the 2nd Link have throttled further growth.
The solution to the problem is the Rapid Transit System (RTS) linking Woodlands North in Singapore to Johor Bahru city centre, adding up to six times the current travelling capacity on the Causeway.
The High Speed Rail (HSR) which starts in Kuala Lumpur, stops in Iskandar Malaysia and ends in Singapore’s Jurong East has also been progressing, with both governments finalising the route alignment and planning to issue a MoU on the project approach later this year. The target completion for both projects will likely be in 2020 onwards, with Chinese and Japanese rail companies leading the bidding process.
For Singaporeans planning to retire in Iskandar in the future, these rail links will make it easier to travel and save a lot of time, making living in Iskandar Malaysia a more viable option.