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Effect of Urban Sprawl on Today's Cities

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Urban sprawl refers to the urbanization which is mostly driven by large scale migration and population growth. Urban sprawl also defined as spread and ineffective urban growth. However, growing urban sprawl results a major challenge and a serious concern to real estate market. Therefore, this essay sets out are to identify the significance of urban sprawl in land economics and to evaluate the effect of its significance to real estate market.

The importance of urban sprawl are developed a mixed-use new township and creates job opportunities. According to Malaysian Institute of Planners’ president, Ihsan Zainal Mokhtar says that urban sprawl have required new townships to be developed in suburban or undeveloped areas with good road linkages and infrastructure, where people could easily access other places through highways (Leng, 2017). These townships called Transit-Oriented Developments which is a mixed-use developments that provide for housing, commercial, social and recreational needs are a solution to sprawling sub-urbans problems (Boey, 2016). According to Lee Kok Wah, director of Low Yat Group, says that a new township must be attractive enough to attract people to live further away from the city and tolerate a longer travel time to work.

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In addition, urban sprawl creates job opportunities either formal or informal job sectors which opens bigger market for local produce to urban dwellers (Samat, Ghazali, Hasni, & Elhadary, 2014). The various infrastructures developments gives better accessibility for sub-urban areas to the urban centers. It offers more convenience and opportunities for the people to get access to their jobs. As a result, the percentage of poor population in both urban and rural area in Malaysia has been reduced from 49% in 1970 to only 6% in 2000 (Salfarina, 2007). 

The effect of urban sprawl to real estate market are loss of rural land and the demand of middle-income earners towards sub-urban areas. Urban sprawl leads to decrease of rural land and green space which becomes possible risk of resource depletion due to industrial discharge (Sathiamurthy, 2008). The high demand of for low price housing causes more farmlands at the sub-urban areas to be converted due to the rapid increase in the residential and commercial developments (Samat, 2011). Due to the low incomes from the rural land compared to the high income from developed land, forces people to sell their land or convert it to commercial activities. In (Amarthalingam, 2018), Datuk Anwar Fazal demanded Penang to stop the practice of approving land in exchange for infrastructure projects.

According to (Yeap, 2015), The Eleventh Malaysia Plan discusses to develop the transit-oriented development (TOD) concept which could attracts private investments for commercial and residential use. In (Boey, 2015), “Most of middle-income people are buying properties far away from the city center because they cannot afford homes in the city” says Tan Sri Eddy Chen, group managing director of MKH Bhd. According to CEO of Paramount Property, Beh Chun Chong says that properties located far from city center are much affordable and cheaper also at the same time increase in demand will push up the price of real estate. Besides that, “The accessibility of public transport and the closeness to highways can drive up the value of the town’s real estate.” says Tan Sri Eddy Chen.

As a result, rapid urban expansion causes urban areas to spread into the sub-urban areas, causing decrease of rural land. Although urban growth brings expansion in the infrastructure and generates economic opportunity both in formal and informal sectors, it is also important to have a road linkages for people to migrate from urban to sub-urban areas. Thus, it is required to construct comprehensive master-planned developments that offer various types of housing, amenities, infrastructure and other features that make for a “dream” place to live.

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