Investing in Melaka Heritage Shophouses Returns vs risks

Heritage shophouses in Melaka which used to command premium prices are selling at a bargain now.

Text & Photography by Jan Yong

Heritage shophouses are in a class of their own– rare collector’s items whose prices will appreciate over time. But collector’s items also means prices depend very much on supply and demand despite its higher intrinsic value.

Heritage shophouses that have attracted the most attention are those in Melaka, less so in Penang, Ipoh or Kuala Lumpur. This is because of the additional factor in the form of Singaporean buyers who are only about less than three hours’ drive away.

With Melaka being a favourite weekend getaway for many Singaporeans, it’s only natural that they want to invest in Melaka. With their higher value Singaporean dollar, they could easily buy a million-ringgit property in Malaysia, which is equivalent in price to a three-room resale HDB flat back in Singapore.

Furthermore, the status of Melaka’s historic core as a UNESCO World Heritage Site since 2008 has pushed up its intrinsic value further as such zones naturally attract a continuous flow of international tourists. Every weekend, traffic jams were endemic and all accommodations were fully booked. Such was Melaka’s tourism heyday when it was the number one state in Malaysia attracting the most visitors at almost 20 million compared to its entire population of 900,000!

This means customers are constantly thronging the streets in Melaka’s historic core, namely Jonker Street (Jalan Hang Jebat), Heeren Street (Jalan Tun Tan Cheng Lock) and Harmony Street. Prices of property then even reached a peak of RM3,000 psf (see table) while rentals can reach between RM17K – RM20K in the most sought-after spots.

The interesting thing is that prices can vary a lot even if the shoplots are on the same street (see table), as this depends on the footfall. Most of the shophouses have been turned into restaurants, cafes, souvenir and foodstuff shops, boutique hotels, Airbnb guesthouses and even private museums. Melaka probably has the highest concentration of private museums in one location compared to anywhere else in Southeast Asia.

Rental Plunge

Those were the good old days. Nowadays, with Malaysia’s unending lockdowns and international and interstate border closures, Singaporeans and KL-lites have stopped coming. With customers gone, tenants are not able to sustain their businesses hence are asking for lower rentals. Landlords have no choice but to accede to their request with some even reducing the rental by more than half.

Says a long-time resident, some shophouses used to rent for about RM7K, now it’s down to RM3,000 or less per month for a 2-storey shoplot. The majority of the shoplots are between 2 – 2 1/2 storeys, with very few one-storeys.


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