How to Choose the Right Melaka Neighborhood for Your Airbnb Investment

Location Matters: But Which Location is Right for YOU?

Every investor asks: "Where should I buy property for Airbnb in Melaka?"

The answer depends on your budget, goals, and investment style. This guide breaks down every major Melaka neighborhood with real data to help you decide.

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The Big Five: Melaka's Top Airbnb Neighborhoods

Neighborhood	Avg Yield	Entry Price	Guest Profile	Best For
**Jonker Walk**	30-38%	RM 300K-600K	Tourists, families	Maximum ROI
**Bandar Hilir**	25-32%	RM 280K-500K	Tourists, shoppers	Balanced returns
**Melaka Raya**	20-28%	RM 250K-450K	Business travelers	Steady income
**Batu Berendam**	18-25%	RM 200K-380K	Airport travelers	Affordable entry
**Ayer Keroh**	15-22%	RM 180K-350K	Families, groups	Lowest price

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#1 Jonker Walk / UNESCO Heritage Zone

The Crown Jewel of Melaka Airbnb Investment

Performance Data (2024):

• Average Daily Rate: RM 180-280
• Occupancy Rate: 65-75%
• Monthly Revenue: RM 9,000-15,000
• Annual ROI: 30-38%

Why It Works:

• UNESCO World Heritage status = global brand
• Walking distance to EVERY major attraction
• Night market (Fri-Sun) drives weekend occupancy
• Heritage architecture appeals to tourists

Target Condos:

1. The Shore Residence - Highest performer, 5-min walk
2. Silverscape Residence - Good value, heritage views
3. Imperio Residence - Newer building, good facilities

Investment Strategy:

• Best Unit Type: 2-bedroom (best ROI)
• Must-Have Feature: Pool view or high floor
• Entry Price: RM 400K-500K for premium units
• Holding Period: 5+ years (capital appreciation)

Who Should Invest Here:

• ✅ Investors seeking maximum ROI
• ✅ Those with RM 400K+ budget
• ✅ Long-term wealth builders

Who Should Avoid:

• ❌ Budget-conscious investors (entry RM 300K+)
• ❌ Those wanting quick flips (heritage zone appreciates slowly)

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#2 Bandar Hilir (Dutch Square Area)

Tourism Central with Modern Convenience

Performance Data (2024):

• Average Daily Rate: RM 150-220
• Occupancy Rate: 55-68%
• Monthly Revenue: RM 7,000-11,500
• Annual ROI: 25-32%

Why It Works:

• Walking distance to Red Square, A Famosa
• River cruise proximity
• Mix of heritage and modern
• Shopping district access

Target Condos:

1. Dutch Square Residence - Prime location
2. Heng Hut Resort - Resort-style living
3. Heritage City Residence - Modern amenities

Investment Strategy:

• Best Unit Type: 1-2 bedroom (flexible)
• Must-Have Feature: River or heritage view
• Entry Price: RM 300K-450K
• Holding Period: 3-5 years

Who Should Invest Here:

• ✅ Balanced portfolio seekers
• ✅ Those wanting RM 300K-400K entry
• ✅ Tourist-focused investors

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#3 Melaka Raya / Batu Berendam

Business Traveler's Choice

Performance Data (2024):

• Average Daily Rate:RM 130-180
• Occupancy Rate: 50-65%
• Monthly Revenue: RM 5,500-9,000
• Annual ROI: 20-28%

Why It Works:

• Close to Melaka Sentral (transport hub)
• Business district proximity
• Medical tourism (hospitals nearby)
• Consistent weekday demand

Target Condos:

1. Novana Residence - Modern, popular
2. The View Residence - Scenic views
3. Melaka Raya Condos - Various options

Investment Strategy:

• Best Unit Type: 1-bedroom (business travelers)
• Must-Have Feature: High-speed internet, workspace
• Entry Price: RM 250K-380K
• Holding Period: 3-7 years

Who Should Invest Here:

• ✅ Stability-focused investors
• ✅ Those wanting RM 250K-350K budget
• ✅ Lower-risk preference

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#4 Batu Berendam (Airport Area)

Air Accessibility Advantage

Performance Data (2024):

• Average Daily Rate: RM 120-160
• Occupancy Rate: 45-60%
• Monthly Revenue: RM 4,500-7,500
• Annual ROI: 18-25%

Why It Works:

• Melaka Airport proximity
• Ayer Keroh Highway access
• Lower competition
• Affordable entry price

Investment Strategy:

• Best Unit Type: 2-3 bedroom (families)
• Must-Have Feature: Parking, airport shuttle
• Entry Price: RM 200K-320K
• Holding Period: 5+ years (development catch-up)

Who Should Invest Here:

• ✅ Budget-conscious investors
• ✅ Those believing in area development
• ✅ Patient investors (long-term appreciation)

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#5 Ayer Keroh / Highway Corridor

Most Affordable Entry Point

Performance Data (2024):

• Average Daily Rate: RM 100-150
• Occupancy Rate: 40-55%
• Monthly Revenue: RM 3,500-6,500
• Annual ROI: 15-22%

Why It Works:

• Lowest property prices
• Highway access (KL, Singapore)
• A'Famosa Resort proximity
• Emerging area potential

Investment Strategy:

• Best Unit Type: 3-bedroom (groups, families)
• Must-Have Feature: Resort facilities
• Entry Price: RM 180K-300K
• Holding Period: 7+ years (waiting for appreciation)

Who Should Invest Here:

• ✅ Maximum affordability seekers
• ✅ First-time investors
• ✅ Long-term speculators

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Decision Framework: Which Neighborhood Fits You?

By Budget:

Budget Range	Best Neighborhood	Why
**Under RM 250K**	Ayer Keroh	Only area with entry this low
**RM 250K-350K**	Melaka Raya or Batu Berendam	Good ROI, stable demand
**RM 350K-450K**	Bandar Hilir	Balanced returns, tourist appeal
**RM 450K+**	Jonker Walk	Maximum ROI, heritage premium

By Investment Goal:

Goal	Best Neighborhood	Strategy
**Maximum Income**	Jonker Walk	Highest rates, occupancy
**Steady Cash Flow**	Melaka Raya	Business travelers, consistent
**Balanced Portfolio**	Bandar Hilir	Tourism + stability
**Capital Appreciation**	Jonker Walk	UNESCO zone value growth
**Lowest Risk**	Melaka Raya	Diverse demand sources

By Investor Profile:

Profile	Best Neighborhood	Why
**First-Time Investor**	Melaka Raya	Lower entry, learn the business
**Portfolio Builder**	Jonker Walk	High returns fuel more purchases
**Passive Income Seeker**	Bandar Hilir	Good returns, lower effort
**Speculator**	Ayer Keroh	Bet on future development
**Singaporean Investor**	Jonker Walk or Ayer Keroh	Weekend destination or lowest entry

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Neighborhood Comparison: At a Glance

Factor	Jonker Walk	Bandar Hilir	Melaka Raya	Batu Berendam	Ayer Keroh
**Entry Price**	High (RM 300K+)	Medium (RM 280K+)	Medium (RM 250K+)	Low (RM 200K+)	Lowest (RM 180K+)
**Rental Rates**	High (RM 180-280)	Medium (RM 150-220)	Medium (RM 130-180)	Low (RM 120-160)	Low (RM 100-150)
**Occupancy**	High (65-75%)	Good (55-68%)	Stable (50-65%)	Moderate (45-60%)	Lower (40-55%)
**ROI**	30-38%	25-32%	20-28%	18-25%	15-22%
**Appreciation**	High (UNESCO)	Good	Moderate	Moderate	Potential
**Risk Level**	Medium	Low-Medium	Low	Medium	High (speculative)
**Tourism Dependency**	Very High	High	Medium	Medium	Low

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Emerging Neighborhoods to Watch

Alor Gajah (A'Famosa Resort Area)

• Current Status: Developing
• Driver: A'Famosa Resort, Premium Outlets
• Investment Case: Singaporean weekenders
• 5-Year Potential: 25-30% ROI (catching up to prime areas)

Pantai Kundur / Tanjung Bidara (Coastal)

• Current Status: Emerging
• Driver: Beachfront, weekend getaways
• Investment Case: Coastal lifestyle appeal
• 5-Year Potential: 20-28% ROI with infrastructure development

Klebang Beach Area

• Current Status: Up-and-coming
• Driver: Beach tourism, food scene
• Investment Case: Alternative to Pantai Kundur
• 5-Year Potential: 22-30% ROI

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Mixed-Strategy Portfolio Approach

Instead of choosing ONE neighborhood, consider diversifying:

Conservative Portfolio (Lower Risk):

• 40% Melaka Raya (stability)
• 30% Bandar Hilir (balanced)
• 30% Jonker Walk (growth)

Aggressive Portfolio (Higher Returns):

• 50% Jonker Walk (maximum ROI)
• 30% Bandar Hilir (diversification)
• 20% Emerging (speculation)

Budget-Conscious Portfolio:

• 40% Ayer Keroh (lowest entry)
• 40% Melaka Raya (affordable stability)
• 20% Bandar Hilir (some premium exposure)

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Practical Selection Process

Step 1: Define Your Budget

How much can you invest? This narrows neighborhoods quickly.

Step 2: Set ROI Goals

What annual return do you need? Higher ROI = Jonker Walk. Lower risk = Melaka Raya.

Step 3: Choose Investment Horizon

• Short-term (1-3 years): Focus on cash flow (any area works)
• Medium-term (3-7 years): Balance cash flow + appreciation
• Long-term (7+ years): Capital appreciation focus (emerging areas)

Step 4: Assess Your Risk Tolerance

• Conservative: Melaka Raya, Bandar Hilir
• Moderate: Jonker Walk, Batu Berendam
• Aggressive: Ayer Keroh, emerging areas

Step 5: Get Professional Advice

WhatsApp us with:

• Your budget
• Your goals
• Your timeline

We'll recommend the best neighborhood and specific condos for YOUR situation.

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Ready to Choose Your Neighborhood?

Don't guess. Get data-driven advice.

WhatsApp us for a personalized neighborhood recommendation:

+60 19-699 6688

Related Resources:

• [Jonker Walk Investment Guide](/blog/jonker-street-airbnb-investment-potential)
• [Melaka Property Market 2025](/blog/melaka-property-market-2025)
• [Investment Calculator](/tools/investment-calculator)

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Frequently Asked Questions

Q: Can I change neighborhoods later?

A: Yes, you can sell and buy elsewhere. But transaction costs (rough tax, legal fees) make it expensive. Choose wisely from the start.

Q: Which neighborhood has the fastest appreciation?

A: Historically Jonker Walk (UNESCO zone). But Ayer Keroh and emerging areas could show higher percentage gains from a low base.

Q: Should I buy in multiple neighborhoods?

A: If budget allows, diversification reduces risk. A 3-property portfolio across 2-3 neighborhoods is ideal.

Q: What if I choose wrong?

A: Most Melaka neighborhoods work for Airbnb. "Wrong" choice just means lower returns vs. optimal. Even "worst" areas still make 15-22% ROI.

Q: How do I know if a condo allows Airbnb?

A: We verify this BEFORE you buy. We know which buildings allow STR, which restrict it, and which are uncertain.

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Last Updated: January 2025 | Data Source: iHousing 100+ Property Portfolio Analysis

Right neighborhood + right property = Airbnb investment success. We'll help you find both.