Impacts and adaptation to climate change in Malaysian real estate

Abstract

Purpose: There is a growing concern in recent years regarding climate change risks to real estate in the developed and developing countries. It is anticipated that the property sector could be affected by variable climate and related extremes as well as by the strategies adopted to combat greenhouse gas (GHG) emissions. This paper aims to analyse the current knowledge regarding future climate changes to understand their possible impacts on the real estate sector of Malaysia with an aim to help stakeholders to adopt necessary responses to reduce negative impacts. Design/methodology/approach: Available literature is reviewed and data related to climatic influences on buildings and structures are analysed to understand the climate change impacts on real estate in Malaysia. Findings: The study reveals that temperature in the Peninsular Malaysia will increase by 1.1 to 3.6°C, rainfall will be more variable and river discharge in some river basins will increase up to 43 per cent during the northeast monsoon season by the end of this century. These changes in turn will pose risks of property damage and increase property lifecycle costs. Furthermore, property prices and the overall growth of the property sector may be affected by the government policy of GHG emission reduction by up to 45 per cent by the year 2030. This study concludes that the property sector of Malaysia will be most affected by the implementation of GHG emission reduction policy in the short term and due to the physical risk posed by variable climate and related extremes in the long term. Originality/value: The study in general will assist in guiding the operational responses of various authorities, especially in terms of those interventions aimed at climate change risk reduction in the property sector of Malaysia.