6% GST but property prices up 6.2%

In a local English daily, it was reported that REHDA President, Datuk Seri Fateh Iskandar Mohamed Mansor announcing that as soon as Goods and Services Tax (GST) starts, it will push property prices up by 6.2%. This is due to the tax being applicable to some building materials. This is indeed a bold prediction. Is this prediction because REHDA members are starting to experience the uptrend in demand? For now, no indication of such and even in REHDA’s own survey, it said that 94% of its members are worried over the impact of GST on their overall business costs. Of course besides GST, two other main worries include financing for buyers and challenges from utility service providers and local authority.

Seriously, issues with financing can only be solved by both parties. The developers just have to provide more affordable units instead of the luxury mindset they had previously. Buyers just have to buy units they can afford and not try to stretch themselves too much. Banks are not going to tolerate the buyers who overstretch too much. They will just reject them instead of carrying over the buyers’ risk into their loan portfolio. This is one thing I personally like about the banks’ attitude in Malaysia. No nonsense. Please keep this strict measure in place. For everyone’s note, even with the ever higher outstanding household debt to GDP of Malaysia, the Non-Performing Loan for all banks continue to be going down or staying at similar levels. Want to know a little more detail? Read here:
84% of homebuyers have only ONE (1) outstanding home loan. 🙂

The second issue of slow approval processes, inconsistent policies/guidelines and high development charges from the local authorities remain the same. The reason is simple, it’s just not transparent enough. If only all these are pushed online and everyone can check on both the applications date as well as the approval dates, it would take out this blame game. I say blame game because every time the developers blame the local authorities, more often than not the local authorities would say that the approval is delayed because of incomplete documentation from the developers. Some developers would then say that the documentation is incomplete because local authorities did changes which were not informed in advance. And the argument continues. Just be transparent, please. Yes, both sides.

Property prices up by 6.2% beginning April 2015? I am sure the buyers would be the decider whether this happens and definitely not just the developers. Unless of course the market is restarting its uptrend beginning April 2015? If the surge restarts in terms of transactions, then whether GST kicks in or not, the property prices would start to inch up again and when you look back, it would definitely be higher than the 6.2% mentioned. However, if the market remain subsided like currently, this claim will somehow not happen. Just look at the launching prices of the prominent developers in 2013 versus 2015. Seriously, higher priced projects or lower priced projects? Happy investing or waiting, as usual.

written on 21 Mar 2015

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Politics no. Interest Rates and GST YES.

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GST in secondary. MIEA clueless.

How will GST affect the secondary property transactions? Do you already know? If you do not know, you may want to ask your real estate agents. The only issue is, even your real estate agents may not know. According to the Malaysian Institute of Estate Agents (MIEA) president Siva Shanker, he hoped that the Customs Department to clarify GST requirements and issues and how it would affect investors. Thus far the focus has been more developer based while for the secondary market no one knows anything.

He said, “How it is going to affect secondary properties? How is it going to affect the individual owner who only has one shoplot, one office lot or one factory to sell? How do you pay, how much do you pay, when do you pay, who do you pay to, at which point do you pay? There are so many questions and nobody has answers.”  Some examples were then quoted by KP Bose Sdn Bhd tax consultant KP Bose Dasan. He asked, “If I own a shoplot worth RM2 million, should I register? If I’m renting it out now for RM100,000 per year, am I subject to GST even if the rent does not reach the threshold of RM500,000 per year? If I want to sell it do I collect GST from the buyer if the selling price is more than RM500,000?.”

These are very valid questions and I think it deserves more media attention so that the authorities would be more forthcoming in engaging with these stakeholders. After all, secondary properties account for majority of all transactions and not the primary ones. In fact, make all these information transparent and all medias should be reporting it too. Investments require a positive sentiment. Where positive sentiment is not available, there should be at minimum certainty. The worst would always be negative sentiment plus uncertainty.

written on 20 Feb 2015

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GST vs the supply and demand?

There’s one question that I would always pose to any analyst. Can GST beat the demand vs supply equation for the property market. To those who answer, maybe not in total but it can distort the market, my next question would be for how long. If the answer is 6 months, then I think the answer is clear, it may be best to buy now instead of waiting for that 6 months to come because by then, you may have lost that few percentage point of potential profits. If the answer is one year, that’s even better, you have time to accumulate a little bit more before buying. Note though that whatever answers that are given, it does not change the demand vs supply equation. Those who need a home would still need to buy a home. They just need that right one to come along. Perhaps price is that final frontier.

Can supply increase? Well, of course it can increase but the question would how fast can it increase? Does everyone understand that if the total number of  projects starting in 2015 is reduced by 50%, it would meant that property prices would most probably go up by 2018 when the market realised far too few properties were being completed by then? Thus, slowdown may be a better time to buy than a ‘HOT’ time. Reason is because many of the usually rational thoughts are out of the window when everyone you know is buying. If everyone is buying, surely they are right? For a democracy, perhaps. For property buying, please go back to why are you buying in the first place. The rest of reasons just do not count.

Are demand reducing? Well, look at the numbers who are getting married. Read here:
Why Malaysia need 8 Million homes based on current population?
 Demand is definitely not reducing when you look at the baby product departments in all departmental stores. Look at the new baby rooms being built for mothers to change diapers or breastfeed their babies. They are not just new, they are well equipped.
Kids eats free. Buy property.

Seriously, stop talking as if GST will bring down the whole property ‘industry’. GST is in fact no match for demand and supply. The only thing that will affect demand and supply tremendously remain the same. Only if another financial crisis happens. I am not sure if anyone wants that though. Cheers!

written on 6 Mar 2015

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200,000 new marriages, 80,000 new properties

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GST within few months, commercial properties and why GST

I do not own any commercial property and have no plans to buy one anytime soon. However, for those who currently have one, perhaps you may want to know that if the commercial building is not completed by 31 March, GST will be levied. Of course, not the whole project but only on the uncompleted portion. If 50% is completed, then the remaining 50% would see GST being imposed. Now, for the good news, at least to buyers. Without a clause in your current agreement, then the tax will have to be absorbed by the developer. The GST would then be decided between developer or contractor as they also have their own agreements.

According to BDO tax/GST executive director, Jeff O’Connell, the GST will definitely bring a slight increase in property prices in general, maybe 2-3%. This cost woll be either passed to the buyer or absorbed by the developer but would definitely not be as high as 6%. Nevertheless, GST would actually lower the costs to businesses in some instances as GST input tax could be claimed unlike the current sales and services tax which could not be claimed. In Australia’s case, pricing was monitored for 12 months before GST and up to two years later and within this period, 51,000 complaints were received, 7,000 investigations and 11 prosecutions and A$21 million was returned to two million customers. The “The Price Control and Anti-Profiteering Act is in place to safeguard against profiteering from the implementation of GST,”.

Personally, I like GST. I do not like it when a certain segment of the market are always skipping the tax through false reporting of expenditures. Dinners with families are put up as business costs, thus rendering the business without profits and thus paying no tax. There are also a lot of other professions which EARNS huge money but pays zero or no tax at all. With GST, you buy more, you pay more. The tax is now on a much wider scale than today which is based on such a small % of the working population. Out of 12 million population, only 1.7 million currently pays tax. Yes, I have been paying tax ever since my first year of working and my mother’s advice has been the same, ‘Do not be afraid to pay tax because the higher your tax bracket proves that you earn ever higher earnings’. If GST is wrong, the majority of any country in the world is wrong.

written on 17 Aug 2014

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Soaring and Tumbling after GST like Australia? Not likely.

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Guangdong, Melaka and top nautical hub

Melaka is not a main property play for many. In fact that question of buying Melaka properties is often a secondary item, behind Klang Valley, Iskandar, Penang and even Kota Kinabalu for some. Actually, I think every market has its attractiveness and the fact is that when the primary ones move up, the secondary ones would follow too. My earlier article about Melaka is here:
Reasons, Numbers and Potential from my latest Melaka visit

Come on, nothing ever happens in Ipoh even if there are now more flights. The only reason why property prices in Ipoh is rising is because the major ones were rising to new highs and thus those in Ipoh followed suit when the buyers happen to be from out of Ipoh.

Anyway, it was announced recently about the potential for Melaka to be an international sea port by 2025 with investments from the Guangdong provincial government to construct harbour facilities. Its Chief Minister Datuk Seri Idris Haron said that once this huge investment is realised, Melaka will be recognised as the largest port in this region. Objectively, shipping lines along the Malacca Straits would definitely pass by Melaka, whether it’s before reaching the Singapore port or after the Singapore port. Either way, harbour facilities would be a great addition. Guangdong governor Zhu Xiaodan had also expressed interest during his working visit to Melaka in turning the man-made Pulau Melaka into a tourist port project as well as to cater to the needs of the maritime industry.

The world is investing in China which is already the second largest economy and the largest foreign reserves in the world. As China strives to play its part as an economic superpower and the big brother in ASIA and the world, Melaka would definitely welcome such interest and the potential investments. Perhaps a continuous update about these catalytic and huge foreign direct investments would really give the Melaka property market more confidence. Let me visit Melaka a few more times to feel the vibrancy and avail myself to more nyonya food before I write an update in the near future.

written on 1 Oct 2015

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Guaranteed Rental Return. Buying whole block. 85% tenanted.

A friend asked me about buying an apartment with guaranteed rental return. I think majority of anyone who has read many articles would understand that these guaranteed rental return MAY also meant that the buyers are paying for it and getting back the rental return on a monthly basis. Of course there is nothing wrong with this because if you really calculate, you would notice that the guaranteed rental rate is definitely higher than if the buyer were to deposit their money into fixed deposits. Some is offering up to 6% which is considered attractive. I told my friend that if she has understood everything that the developer is selling and she likes it, by all means go for it. She invited me to buy one unit and I politely declined, saying it is not my cup of tea. My reason is because I already have my next property in my mind and is still saving for it. A secondary unit which is easy to rent out, even IF the rental return is next to nothing.

If someone were to offer me a unit with tenant and a seemingly attractive selling price, I would grab it. However, when it’s one whole block, then I may not be their target. Perhaps REIT funds may be interested? Alternatively a very rich businessman who just want to buy a recurring income for his son? Haha. I am none of both. The offer was for a 10-storey high-end residential block in Ampang Hilir which is considered a prime area in Kuala Lumpur. The said property is known as 7 U Thant and it comprises of 24 apartments ranging from 500 to 4,600sf. It is a 4 year old bloc and the guide price is RM131 Million or about RM1,343 psf. Successful bidder is required to honour all existing tenancies.

Currently, 85% is rented out, which meant an immediate recurring income, as long as the tenants do not move out within this period of it being offered to market. Facilities include gymnasium, BBQ pit, Jacuzzi, skydeck and a rooftop infinity pool, in addition to its 24-hour security and generous parking space. In terms of location, it’s considered pretty exclusive. Opposite the US Embassy and just a 10 minute drive to Kuala Lumpur City Centre (KLCC). Interested buyers are advised to submit their bids by 26 November 2014. Its marketing agent is SLP International.

I have no idea what’s the final decision of my friend but I hope she understand her risk profile and buy accordingly instead of asking me. Over many years, I have learnt that her reasoning and mine are totally opposite. Haha. It’s ok, anything that makes sense would give you returns. I have never been pressured to follow any property gurus and I feel that no one should be forced to follow me too. Reading and understanding, why not but following is another matter altogether. Happy investing!

written on 2 Nov 2014

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How to know if the GRR deal is a genuinely attractive deal?

For anyone who’s looking for some personal finance resources, I would recommend
kclau.com
 This is one of the most prominent personal finance guru in Malaysia today. On a monthly basis,
KCLAU.com
 receives on average over 100,000 visits. (Based on similarweb.com data as at end Oct 2017) This is definitely a leading personal finance site in Malaysia. I read a recent article which KC wrote and I believe it is well written, with logical explanations and really gives anyone who’s thinking about Guaranteed Rental Return (GRR) developments to decide better. it’s in simple English and is free from any jargons. Happy reading and do sign up for his articles yeah. Here’s the website again:
kclau.com

— start —

Investors are always being reminded to be wary about “guaranteed rental return” (GRR) schemes in Malaysia property market. It will not be surprising to see more and more guaranteed rental return (GRR) schemes in the next few years.

As developers seek creative ways to increase the appeal of their property in a more challenging market to come, more hybrid variations will eventually surface. Over the past two years many GRR schemes were offered. The concern here is, however, whether the developer will be financially capable of honouring it.

What is GRR? Why is it popular?

GRR, also known as leaseback, buy-to-let or cash back, is resultant of developers’ creativity in wooing investors with a GRR scheme on yet-to-be-built properties like condominium, hotel, retail mall, shop house, vacation property, etc. According to the plan, developers agree to pay buyers guaranteed rentals in a percentage of the purchase price for a stipulated period of time.

A guaranteed rental scheme can provide buyers with peace of mind, safe in the knowledge that buyers will receive a fixed income for an agreed time period. Many buyers like to use the guaranteed rental income to pay associated mortgage and maintenance costs. Additionally, the management of the property is hassle-free as the property developer or management company is responsible for this aspect over the agreed time period.

Many investors like guaranteed rental schemes because they do not want to get involved with the management of the property. Generally, GRR are best for the laidback investors. It has proven to be extremely popular especially among overseas investors who like to know their property is looked after throughout the year while they receive a return on their investment straight away.

Some people will value the ‘simplicity’ of the deal. However there are issues that buyers have to be aware of and comfortable with before entering into such agreements.

What is behind the scene?

The “guaranteed return” is indeed included in the purchase price already. Developers are pricing the property higher than the market price with additional sum equivalent, if not higher, to the guaranteed return. For example, a condominium project with guaranteed 5% annual rental for 9 years may imply that the final price from developer is at least 45% (9 x 5%) higher than the market price.

A quick check to see if the final price is justified under such scheme, is to ask: after deducting this 45% from the price, is the property still looked attractive enough compared to a similar property in the same area at current market price? You may probably use the same amount of money to buy 2 similar units in the same area without the scheme!

In the above example, the total amount of “rental return” for the 9 years is in fact an amount of cash you pay upfront to the developer, borrowed by you from bank if you finance the investment. The developer then returns it piecemeal to you without any interest while you bear all the interest charged by bank.

Meanwhile they still “temporary own” your property to do whatever they want to do for the whole 9 years since you signed a leaseback agreement with them!!! Either they use your property to generate more money for their own pocket or just leave it vacant, they have nothing to lose because they have already got all this money from you, in the selling price…

Think twice and calculate thrice before you invest in such scheme because most projects marketed with such marketing arsenal are implying a weak financial situation (insufficient cash) of developers. Such developers are considered as high risk builders who might not even be able to complete and deliver their projects in the first place.

The Boss, one of Klang’s hottest development projects, has come to a halt victimising 300 confused investors who were promised with attractive return. Most of the buyers were attracted to the guaranteed high returns of 7.5 – 8% a year by the developer. Being launched in 2012, most of the buyers received information in February 2015 that the development has fallen to the hands of a liquidator.

Rental guarantee could be important for some investors who need reassurance. However, the guarantee is only as good as the strength of the company offering it.

What must be checked up front?

Six points to check before you buy property with rental guarantees.

1. If the GRR is not part of the deal, would you still buy this property?

2. Is the property selling price justified in comparison to other similar properties within the same vicinity?

3. Does the developer have the capacity to build and manage the property, and ensure the income is generated?
Assessment of developer’s background, style and planning of asset management must be included in the due diligence.

4. Is the rental income figure realistic and achievable in the current market where the property is located?
If not, the investor will see a dip in returns once the rental guarantee period ends, which indicates a potential drop in the value of the property. Many unscrupulous developers will inflate the rental guarantee figures to create a good impression.

5.What is actually underwriting the guarantee?
Is there an actual contract in place where there is a legal recourse should the income not be generated? If not, then this should be a cause for concern.

6. Do you understand all the terms and conditions in the GRR agreement?
 Inexperienced investors may not understand that the fine prints are often written in the guarantors’ favour. Example of such clauses:

“Provided always and it is hereby agreed between the contracting parties hereto that the Developer reserves its right to terminate the GRR agreement for any reason whatsoever by giving TWO (2) MONTHS written notice to the Purchaser wherein such a case the Developer’s obligation to pay the guaranteed return to the Purchaser shall cease from the date of such termination. Such notice is deemed to have been received within three (3) days from the date of the letter”.

A wise investor should check the small prints for any hidden clause that allows the developer to avoid paying the guaranteed rent and it is always a must to seek expert advice.

There are some good deals out there and some good properties with potentially very good returns. But even in such cases, part of the essential due diligence is to research whether the investment property represents good value and ascertain what the rental market situation is.

The rental market is volatile, depending on current competition and market conditions. It is a cyclical market, and is subject to the laws of supply and demand as in any other sector of the economy.

There must be real rental demand to substantiate GRR scheme or it will not be able to last through the entire term, especially if the units remain vacant. The scheme could eventually become disastrous when developers face difficulty filling up the units to
 fulfil their promised rental returns.

This article is contributed by me and Dr. Ong Kian Leong, founders of the first ever online property investment course for Malaysians, called
Property Method
. Dr. Ong Kian Leong (commonly addressed as Dr. OngKL), is the creator of GoFinanceTM, a tool that allows investors to accurately evaluate if an investment is worth investing as well as worth financing for maximum return. Claimed by himself as a student in the life-long learning journey, he is also the master trainer of Property Method and the blogger behind
Real Estate Investment Blog
.

— end —

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Guarded? Great. How many guards are there?

Would you feel safe if you walk along a lonely road accompanied by a 60 year old man who happens to be a security guard? Or would you feel safer walking along the same lonely road with two 60-year old men who are security guards. How about walking along the same road again, this time with a few tough looking men, say 30-40 years old, dressed up nicely in uniform and all are security guards?

Actually, if there’s a man on that same road and he’s running towards you, carrying a samurai sword, perhaps all these security guards would run away leaving you alone. This is true! However, if I intend to rob you, even if I have a parang, I would not take my chance and risk it if there’s someone with you who looks like a security guard. It’s best that I find an easier target who’s alone. Of course if there are 3-4 security guards with you, I would be foolish to take my chance..

This is a real situation today. There are many developments where the typical number of security guards would be 2.  The reason for two is so that should one goes to the toilet, there’s another one in the guard post. Of course, this usually corresponds to how high end the project is or how low density too. The higher maintenance fees we pay, the better the number and quality of guards would be.

This is the reason why I would encourage potential buyers to get to know the type of security that they will be having. In fact, when we view any secondary developments that we want to buy these days, take a look at the guards on duty. If we do not feel secure then, there’s no way that we will feel secure after we move in. It’s also true that the quality of these guards differ tremendously too. Some look totally inexperienced, some do not wear their uniforms properly and some could not even converse with us!

Do more guards meant that that particular development would always be safe? The answer is NO. However, it’s good to note and learn from a former car thief on how they target the cars to steal or break into. They target cars which are easy targets. Cars which are locked with even the cheap steering locks are usually skipped because there are cars without and those are much easier. They would not want to skip those extra seconds in cutting the steering when there’s another one next to it without a cheap steering lock.

Cars with a blinking alarm would be skipped if there are cars without alarms. Again, the alarm is NOT a show stopper but it is a major deterrent. Key learnings? If someone wants to choose some developments to target (whether to steal or to rob), they would target the easier ones first. In this case, it’s definitely one where even if they (criminal) get discovered, they need to only deal with one or two guards instead of 4 guards or more. Do read the article to learn how to keep your car safer, yeah.
Tips from a former car thief on how to protect your car from being stolen.
 Happy searching for your dream home coupled with better security.

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written on 13 Feb 2018

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GPO: Guess which shop has the longest queue?

It’s opened. It’s just 50 minutes away from my home. I love its ‘sister’ outlet in Johor. Yes, I have just visited the Genting Highlands Premium Outlet two days ago. Earlier article here:
What if all the cheap goods are sold out?

Shopping without sweating is great. It’s not as cold as I would have wanted but hey, even at 1pm in the afternoon, I did not sweat and that’s good news. Brand diversity is pretty good. Oh yeah, guess which brand had the longest queue? Coach is the answer. I queued up to go in too and it took me around 15-20 minutes. Were the handbags cheaper than the usual Guess stores? Okay, they are not from the current season but the answer is Yes, it was cheaper. Some ladies wallets were RM1550 and after the discount was less than RM500. Guys wallets too. Did everyone buy something after queuing? I would ‘guesstimate’ that around 30 percent of those who queued did buy something. At least their 15 minutes were not wasted.

What else was cheap? Well, I bought another pair of running shoe from Puma outlet store. It was their opening sale. So, all the items were already 50 percent off. It does not stop here. Buy 3 items, pay for just 2. My RM478 running shoe became RM239 and after that buy 3 pay for 2 offer, it became RM168. That’s not all, I got a free Puma cap too. My wife and her best friend each got themselves a running shoe too. Apart from this, I went into Camel, Geox and Clarks but the sizes and the designs do not match one another. Designs that I like, there were no sizes. My friend told me in Whatsapp that she could buy even cheaper luxury handbags in the U.S. I only replied with a smile. Haha. I have no idea when I would be going to the U.S and friends going to the U.S, I already pity them because they already have a long list of shopping items from siblings, friends and relatives. Watches were okay too. Anyway, could not really shop as I brought along my two kids too. Haha.

Shopping was a breeze and it’s really comfortable. The concept, the shops, the design is similar to the
Johor Premium Outlet. Same joint owner.

The toilets could have been better maintained but the food court has sufficient choices. Most shops were already open from my 4 hour visit and I did not visit Padini… I did however take a break in Starbucks and yes, it has a very nice view too. Coffee Bean is on its way. (I am a Coffee Bean lover even though I am also a Starbucks supporter). Parking was easy. There were many floors and it was nowhere near full capacity, yet. Oh yeah, I will be up there again next week as my sister is driving down from Penang for a short break. Perhaps we would drop by the casino too this time. More photos to follow below. Over 150 brands are represented here.

To those shoppers who loves to see more brands and loves shopping al-fresco style, this is the place to be. I think it will soon be swarmed with even more people. Parking is free! Just sign up as a Genting Rewards member. Happy shopping.

written on 3 July 2017

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Gurney Wharf is one place I will bring my kids. When will this happen?

There is little doubt that visitors love to visit Penang. Lots to eat, lots to do and well, lots of places to just relax and do little. I was based there for 15 years and have many good memories too. Yeah, I still have properties in Penang which I intend to keep for as long as I could. Anyway, prices are not that awesome at the moment, thus it’s holding time. So many agents have called me but when told of the current price on offer, I prefer to just hold.

I visit Penang probably 4 times a year these days and have been to
IKEA Penang 3 times too.
 There’s going to be one extra reason to visit Penang in 2021. It’s even suitable for my two kids as they always love to run around in a nice public park. A new attraction called Gurney Wharf will be completed and open to the public too. It’s built on reclaimed land and it’s situated within the Gurney Drive. More updates below:

Article in freemalaysiatoday.com
  Penang Chief Minister Chow Kon Yeow said that new waterfront on reclaimed land off Gurney Drive will be completed by August 2021. He shared that the state government would sign an agreement this month to appoint consultants for the project. A tender will later be called for a contractor to start planting trees and plan the landscape as well as to ensure the project could be completed within the next 18 months.

Chow said, “We hope by 2021, not only the residents from Pulau Tikus, but also people from Penang will be able to enjoy a new waterfront at Gurney Wharf. ” Additionally, this new waterfront includes a public park. Consultant architects Grant Associate prepared the conceptual master plan and they have worked on Singapore’s Gardens by the Bay too.
Article in freemalaysiatoday.com

Another image for everyone’s viewing. All images within this article is from
https://grant-associates.pr.co/

You know the only thing not that awesome about Malaysia is our hot weather. (of course, lots of sun is still better than lots of rain if you ask me) Else, this new public park in Gurney Wharf will be full of people from morning till late evenings. Of course, those visiting Gurney Mall or Gurney Paragon Mall could just walk over. Parking along the Gurney Drive is not that easy to find. Just 18 more months to go. Happy waiting for it.

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Penangites you have another affordable choice within the island

Header image source:
https://grant-associates.pr.co/

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Gym membership, condo and its facilities, your money and you

A young colleague spoke to me the other day. I term young as those who are younger than me by 5 years or more. How old am I? Many more years to 40. Haha. He said, if I were to buy a condo, rent it out and retain one access card so that I can use the facilities, do you think it is a wise idea. I told him, even if we don’t talk about the potential capital appreciation, the use of the facility itself is already worth it. For example, a typical gym membership for a year in a local gym might be RM1,500 per year and the branded ones even higher. You get free classes and the gym equipments are many times more well equipped than your condo but frankly, do you really use the gym?

He said, not really but then RM1,500 divided by 12 months is just RM125 per month. I answer, please be reminded the gym membership is for ONE pax only and it most probably does not come with an infinity swimming pool, kids playground, perhaps a tennis or a squash court and even a garden where you can take a morning stroll. Don’t forget also that whatever you pay to the gym no longer belongs to you but whatever maintenance fee you paid helps to maintain the facilities which will ensure your capital appreciation continues to go up. If your wife, your parents and your children wants to use the swimming pool, it’s free. If they want to join the gym membership, you just lost many thousands of Ringgit. He laughed. ‘True, True’.

Actually the situation that he spoke about, it’s already happening and he will not be the first one to do so. Another colleague is doing that every few weekends in her sister’s condo which was rented out. However, always understand that buying for rental meant that you must also make sure that it is easy to rent out. Keep your main objective in mind and not get too carried away when you see the many facilities that you can use and how happy your family would be because your tenant may not be renting from you because of these reasons. It may be because it’s near to his office or he just love your condo.

written on 26th Sept 2014

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Singapore, United States, Spain, Japan, Netherlands and Iskandar

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First half 2017 volatile. Second half good time to buy?

We have been hearing of how affordable homes are the ones which are moving or in demand by majority of buyers today. Luxury ones are not that marketable due to lower demands.
Developers love to build affordable these days

Here’s an article from
iProperty
 about reasons for a volatile first half of 2017 and a good second half 2017 to buy. My friend Dr.Daniele Gambero has this to say about property investment. “When looking at timing, this means knowing when to enter and exit the market. In fact, now is a good time for you to start your property hunt as there is so much supply of homes in the market. This has made it a buyers’ market. However, you must also be discerning by looking at where the demand is as this will enhance your future property values. There is currently strong demand for affordable homes. Therefore, you should have an investor’s mindset by looking for the most affordable home but with the greatest room for capital appreciation.” He was speaking at a recently concluded talk held at Bukit Puchong Sales Gallery.

As for the best times to buy, Prof.Joe Choo, president of Malaysian Institute of Geomancy Science (MINGS) said, “A good time to buy a property will be the second half of the year. For the first half, the market is still very volatile. The second half will be more stable and you will see more available stocks in the market. The secondary market will be very good. The primary market is a bit slow this year. However, for next year, the primary market will be good.” Echoing his view would be TAHPS Group CEO Eugene Khoo. He shared that in 2017, the property market will be flat. In fact many developers are already offering attractive packages and/or rebates to entice purchasers to clear existing stock. I see more developers launching smaller sized properties, especially in the high rise
category to increase affordability
.
Don’t be surprised to see 400 sq ft properties being launched.” The
full article is here.

It’s good to visit the areas that we are buying regardless of first half or second half of 2017. Sometimes, our hunch is better than any prediction or calculation. My advise is always to buy something that we are comfortable with because chances are, there are future buyers who would also be comfortable too. The thing to watch out for would be the price that we are paying. On a much longer period, the property we buy should naturally become an investment. By the way,

lots of TIME is needed for property purchase.

Secondly, during boom periods, prices tend to move up faster simply because demand spiked suddenly and the better projects cannot suddenly multiply in the number of units. Happy

written on 16 March 2017

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H1 2019 will see retrenchments in construction and property sector

If we have been following the news from the construction sector, we would know that the sector is reeling from some of the mega projects cancellation and postponement. One latest one was recent too:
LRT 3 is important. Please manage it well.
 There’s another update about the employment in the construction and property sector.
Here’s that article in TheEdgeMarkets.com
 Recruitment agency Randstad says that Malaysia’s construction and property sector is likely to see retrenchments in the first half of this year. In its 2019 market outlook report, it says that bulk hiring activities have slowed down since May 2018 and companies have since focused on getting their projects approved or reapproved by the new government.

The agency also shared that the government’s decision to prolong duration of projects could save money but it will cause the demand for manpower to drop. It said, “Companies will not need to mass hire people to complete the project within a relatively short period of time. With the extended deadlines, companies can hire fewer people for the project, spreading the manpower cost across a longer period.” It added, “Unfortunately, this means that retrenchments will likely take place in the first half of 2019.”  It however concluded on a positive note. It said, “Depending on the individual’s work experience, there is a high possibility that these candidates are able to receive job offers from other companies quickly.”
Here’s that article in TheEdgeMarkets.com

I think it’s important to note that some sectors are more cyclical than others. This is the reason why it’s important to keep upgrading our skills because we do not know when that extra knowledge or skill may be the reason for us not to be retrenched of the reason we are able to find the next job quickly. At the same time, it’s very important to save, invest and increase whatever we have because during rainy days, these will become important too. Here’s an earlier article:
Investments? Minimising, Maximising and Solidifying.
 By the way, all these do not mean Malaysia is going into a recession yeah. Our economy is expected to still grow between 4.5 to 5 percent for 2019 based on predictions thus far. Happy understanding that it’s not all gloom and doom.

written on 18 Jan 2019

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H1 2015: Malaysia Overall Residential Property Market

Everyone said the property market is down, in terms of numbers. However, no one really knows about the actual numbers. Well, time to look at some real numbers. The chart below comes courtesy of Raine & Horne and the source is National Property Information Centre (NAPIC). The Malaysian property market actually hit its peak in Q2 2011. The slowest period meanwhile was reached in Q1 2014. Q1 2015 was down versus Q4 2014 but Q2 105 has showed a slight increase. For a more in-depth numbers, do refer below.

There is an overall residential property market contraction in Malaysia during the first half of 2015 as compared to the same period last year, according to the number and value of transactions figures released by National Property Information Centre (Napic).

The first half of 2014 recorded a total 122,830 transactions in the market worth a total RM40.31 billion but in comparison, the first half of 2015 only recorded 119,599 transactions which is a 2.63% contraction with a value of RM37.97 billion. If we look at the quarterly comparison, the first quarter of 2015 saw a slight increase of about 1.46 % compared to the first quarter of 2014, from 58,767 transactions (worth a total RM19.39 billion) to 59,626 transactions (worth a total RM18.74 billion).

By the second quarter, there is a noticeable contraction by 4,090 units from 64,063 transactions in 2014 to 59,973 transactions in the same  period this year or a contraction of about 6.38%. Over the years, it is normal for transactions to increase from the first to second quarter as could be seen from the increase in transactions in 2014 from 58,767 transactions to 64,063 units (worth a total RM20.92 billion) in the second quarter.

Looking at the transactions history for the previous years, the first quarter of every year will see a slight drop before the transactions spike in the second quarter. The residential property market in Malaysia hit its peak in 2011 when the second quarter of that year saw transactions spiked to a high 73,710 units (worth a total RM16.68 billion) from 60,333 transactions (worth RM13.52 billion) in the first quarter of that year.Similarly, in 2012, the first quarter saw total transactions of 64,402 units (worth a total RM15.13 billion) before it spiked up in the second quarter to 71,595 transactions (worth at total RM17.48 billion).

After the market hits peak periods between 2011 and 2012, it began to drop in 2013 and reached an all-time low in four years in the first quarter of 2014. The market picked up in the second and third quarters of 2014 by recording 64,063 transactions (RM20.92 billion)  and 63,661 transactions (RM21.66 billion) respectively.

The market again dropped to 60,760 transactions, with a total value of RM20.09 billion) in the fourth quarter of 2014 and continued to drop in the first quarter of 2015 before it increases only slightly in the second quarter of this year.

The overall residential property market in Malaysia in the last four years and the first half of this year saw the market spiking in 2011 and 2012 before it contracted in 2013 and though it increased slightly in 2014, it showed a contraction for the first half of this year.

Raine & Horne International Zaki + Partners Sdn Bhd Senior Partner Michael Geh attributed the overall contraction in the market to strict loan requirements.

“The low loan approvals due to stricter loan requirements has taken a toll on the property market,” he said.

published on 1 Nov 2015

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Better H2 2016 for Malaysia, GDP growth at 4.4%

As a property investor here in Malaysia, I remain pretty optimistic. I think as long as we do not buy with our eyes closed, we should do just fine.
2018 can either be a great year
 or a
recession
. I take a longer term view than just 2 years. Reported in NST on 8th June 2016. I consider this a good news for Malaysia amidst the gloom. UOB Bank economist Julia Goh has projected Malaysia’s 2nd half GDP 2016 to be at 4.4 percent. This is better than the first half average at 4 percent. Reasons include
mega infrastructure capital spending
 and the government’s growth stabilisation measures.

She explained that the government has put in place several stablisation measures which could boost the nominal GDP by at least one per cent. This included the three per cent cut in the
Employees Provident Fund (EPF)

contribution rate, a special RM2,000 tax relief for middle-income tax payers, an increase in minimum wages and civil servant wages, visa waiver for China tourists, as well as a one per cent corporate tax cut. Yes, my dear Malaysians, all these should actually help the economy during the current slowdown.

Her expectations for the Ringgit? “Our outlook for the ringgit remains positive driven by recovering oil prices, the country’s sustained current account surplus and intact fiscal deficit targets.” Goh also said that
greater economic diversification
 has also reduced Malaysia’s dependence on oil revenue with share of oil revenue projected to fall to 14.1 per cent in 2016 compared to 35.8 and 41.3 per cent in 2011 and 2009, respectively. Yes, fellow Malaysians, do understand why former Bank Negara Governor Tan Sri Zeti said that the Ringgit is undervalued and that oil dependence and actual effects on the GDP has been reduced tremendously over the years.
Ringgit is definitely undervalued.

Happy following.

written on 8 June 2016

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Hainan Tea cafe

If there is a cafe with a good hainanese coffee but the food is so-so,  would you visit? Chances are no.  Today I visited a good cafe with hainanese iced coffee called Hainan tea.  I also ordered its Nasi lemak rendang chicken. The gravy was really delicious. I enjoyed both tremendously.

The shop is in puchong.  If u have Standard Chartered card you get 20% off,  a good deal I must say. If you ask me if the coffee is better than old town,  my answer is, don’t compare apple and orange because though subtle there is a difference between white coffee and hainanese coffee.

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Half of the cost, going ahead and delayed too; LRT 3

Many friends are now telling me that we should not be buying a property solely because it’s near a LRT / MRT. The reason is because the government is doing lots of cost-cutting and deferment so that the country’s finances can recover.  Seriously, I believe this should always be the case right? If there’s just ONE reason to buy the property and the REASON is LRT / MRT, there is a HUGE risk with our decision lah. Anyway, our Light Rail Transit (LRT) Line 3 will be continuing as the government has agreed with the lower cost of RM16.6 billion. This revised cost is nearly HALF of the cost of RM31.65billion announced by the government in July.
Full article about this in NST here.

The LRT Line 3 was a project under MRCB and George Kent which had formed a joint venture company named MRCB George Kent Sdn Bhd earlier. They were the project delivery partner (PDP) of LRT3. Now they are no longer the PDP and the project is now based on a fixed price contract regime. In July, Finance Minister Lim Guan Eng had said that the cost of the LRT3 was reduced by 47 per cent from RM31.65 billion, thus saving Malaysians RM15.02 billion. LRT Line 3 is a 37km line which aims to alleviate traffic congestion along one of the most important and densely populated economic development corridors in the Klang Valley, from Klang to Petaling Jaya. It is expected to serve an area with a population of two-million people, with the capacity to transport 36,700 passengers per hour each way.
Full article in NST here.

I do wonder what’s the major difference in this case. PDP was given the task of completing the project on time, failing which they will be fined but if it’s ahead of schedule, they will get some rewards. Anyway, the continuation of LRT Line 3 is a good news to those who were ‘sweating’ with the potential that the stations nearby their properties being cut. Just note that the timeline is delayed by 4 years to 2024. The order of 42 sets of six-car trains are now reduced to 22 sets of three-car trains. There were also streamlining of the size and design of the LRT stations based on Kelana Jaya LRT line standards. Five stations were shelved until it is deemed necessary to be built. They include Lien Hoe, Temasya, SIRIM, Bukit Raja and Bandar Botanic. A 2km tunnel for the LRT together with an underground station at Persiaran Hishamuddin, Shah Alam was also cancelled. Happy following.

written on 18th Oct 2018

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When half of overhang units are below RM300,000

On and off, we would come across reports about how unaffordable has property market Malaysia become. In fact, we have been said to be unaffordable for quote some time. Read here:
Severely unaffordable, worst than Singapore, Japan and USA – US based Demographia

On a more recent note, this was also highlighted by our very own Khazanah Research Institute. It is definitely not a rosy picture. Read here:
To be affordable, KL homes must be RM280,000

There are also many property experts telling us to pay ever higher for properties nearby malls, MRT or even in great locations because prices will keep rising. Well, recently it was reported that of all the overhang units in 2015, 50 percent were for homes below RM300,000!

Overhang properties are defined by the government as properties that are completed and issued with Certificates of Fitness for Occupation (CFO) or Temporary Certificates of Fitness for Occupation (TCFO), but remain unsold despite having been put on the market for at least nine months. Of course, we would now think that they were unsold because of the prices, right? Well, not really. Just look at the image. Properties priced at RM
500,000 and higher comprised of just around 32 percent of total overhang units in 2015. Meanwhile homes below RM300,000 accounts for around 50 percent of the total.

If Malaysians need more affordable homes and they need more of those below RM300,000 then why are they unsold? A few developers involved with these cheaper homes told me that many times, it’s hard for the buyers to get their loans approved. Somehow, it is this group of people that would find it hardest to save enough for a roof over their heads. Besides that as usual, it would also depend on where the property was located, lack of public transport or even due to the design.

I think these unsold units should not be allowed to maintain their status. Helping those who needs a unit is vital and the government would need to do more. As for location, perhaps building higher density in better locations would help too instead of building somewhere far away. Secondly, with more LRT and MRT stations, more areas would eventually be accessible. Another reason would also because of the units allocated for the Bumiputera quota. Any unsold units will take some time to clear because the mechanism for the release is different from state to state. It’s time to be both effective and efficient. Happy buying some of these overhang units.

written on 26 Apr 2016

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Penang’s Hampshire – Shaolin martial arts and 2,100 residential units

Have you ever visited the Dragon Boat Race in the Teluk Bahang dam in Penang before? It’s an exciting race and there are normally lots of foreign rowers too. The only downside is that it is usually pretty hot and may not so suitable if you have a toddler and a baby like me. The next race was supposed to be coming, 28- 29 May 2016. Due to the dry season, it has been postponed to December 2016.
More details here.
 Well, Teluk Bahang is now more than just a venue for a boat race. There is a potential big development by Hampshire Group as per reported in
penangpropertytalk.com

Take a look at the image. This is a huge development in Teluk Bahang, Penang. It will have 2,100 residential units consisting of 1,378 affordable units in 5 towers of 30 floors, 351 terraced and semi-detached homes, 135 two-storey bungalows and 216 “super condos” in a 32-floor tower. There would also be an international school, a 4-Star hotel (25-storeys high) and a Shaolin martial arts temple. The temple will cover approximately 40,000 sq ft with a 4,800 sq ft meditation yard. All these would be built on a huge piece of cleared hill slope forest near Teluk Bahang.

Before anyone try to look for the number to call in order to book anything, do note that as per the developer, all these are still at conceptual stage and they have yet to conduct the feasibility study for the plan. For the affordable units, it is bigger than what we usually read. It’s 1,000 sq ft and would come with facilities such as swimming pools, gymnasiums. Prices would be around RM300,000 per unit. Yes, I think it is pretty attractive. The only downside would be that Teluk Bahang is not considered a primary residential area currently. We shall see if this development may change some of the mindsets of Penangites. Happy reading.

written on 11 May 2016

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Hap Seng’s Kuala Selangor land buy and GDV of RM9.3 billion

First of all, I still own 1,000 units of
Hap Seng Consolidated Bhd.
 Yes, too small to amount to anything except for potential dividends for a good dinner with my family. Hopefully, it continues to do well and this is reflected in its share price. Well, as per TheEdge, Hap Seng Consolidated is buying 36 parcels of freehold agriculture land with an aggregate land size of 1,449.52 acres in Kuala Selangor for RM228.75 million. The plan is for a mixed development with an estimated gross development value (GDV) of RM9.3 billion. Yes, land cost is less than 3 percent of the estimated GDV.

The plots of lands would be from two separate vendors, Shalimar (Malay) PLC and Indo Malay PLC. From Shalimar, it will buy 20 plots of land, which collectively measure 734.82 acres. The price would be RM121.54 million. From this buy, it will develop “sought-after, modern guarded and gated lifestyle residential properties with commercial components.” The project has an estimated GDV of the RM5 billion, over a 15-year development period.

It will be buying 16 plots of lands measuring 715 acres from Indo Malay for RM107 million. Hap Seng intends to develop the land into a mixed
development township with affordable housing
. The estimated GDV is RM4.3 billion, over a 15-year period. The target for this development would be for the increasing demand of affordable properties as well as for students in University Selangor (UNISEL)

Connectivity wise, all 36 plots can be accessed easily via LATAR expressway. Besides connectivity, the lands are also close to the Royal Kampung Kuantan Golf Club, and University of Selangor in Batang Berjuntai. I think majority of us would know the Kuala Selangor is also famous for firefly-watching. Based google map, the distance of Kuala Selangor Firefly Village to KLCC Jalan Ampang is 69km or 56 minutes on non-peak periods. I think this would also mean that it will give developers in
Semenyih some healthy competition.

Good for us, the buyers. More choices, more competitive prices, hopefully.

Nothing has been launched just yet because the deal is expected to be completed within Q3 2016. Happy waiting.

written on 6 July 2016

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Happiest homeless person. Well, not for me.

I am old-fashioned. I need to own the home I stay in. I do not want to be pushed around by the home owner when he / she wants to take back the property which I am renting in. (If I am renting). Remember, good times for people to rent a property do not last forever. When market recovers, rentals will start to increase again, yearly. I will also hate it when the owner increases my rental every year. I am however not into landed properties if they are not gated and guarded and with a nice club house which I could bring my kids anytime I want. So, I will only be happy when I own my home and I could utilise the facilities provided by my home. I am willing to work hard everyday to get my monthly pay to pay for that home too. Let’s look at someone said to be the happiest homeless person in Hong Kong.

Article in South China Morning Post (SCMP) here.
 The article shared about a homeless person named Simon Lee and said that he is perhaps the happiest homeless person in Hong Kong. He is a 52-year-old who has swapped a comfortable middle-class existence in favour of life without work, but also without a penny. He has already slept for seven years next to a snack shop in Victoria Park. He said the following too:

“I think I actually save resources for society. I’m low maintenance, I don’t use money, so I don’t have to make money. I don’t chase fame or material things.
“People often think of homeless people as dirty, battered and impolite. But the homeless have their own way of living too. We can have a very decent life.”

“In the many years since I’ve been homeless, I’ve never met any other person who was homeless by choice. I’m a bit of an oddball,” the eloquent and soft-spoken Lee says.

“To me, it’s liberating. I don’t pay rent, I don’t have to buy a house, I can sleep anywhere. Street sleeping solved a lot of my problems,” he says.

“Hong Kong has so many rich people and so many wasteful people. There’s always something I can use that someone else has discarded,” Lee says.

“If I can avoid this pain, why should I go and seek it? I don’t envy people with partners or family, I’ve always been independent,” Lee says. “I stopped speaking to my family years ago and I don’t regret it at all. Other people should envy me.”

There is no need to worry about tomorrow, Lee says. The most important thing is to enjoy the moment. I will let fate decide what happens to me,” he says with a smile.

Other numbers shared in the article include official figures showing 1,127 Hongkongers were sleeping on the streets in 2017 and 2018. But social workers estimate the number is at least 2,000. About 35 per cent of the homeless say they are unable to rent a place to live because they are unemployed. More than half sleep in parks, playgrounds or car parks.
Here’s the full article in SCMP for reference.

From the interview, I think the general conclusion is that the homeless man, Lee is happy with his life thus far even without a home and sleeping on the street. I think it’s good for him. One man’s meat is another man’s poison. As much as he said people should envy him, I would like to also say that not everyone would envy this lifestyle because many of us would also have responsibilities. Perhaps we have a family to take care of. Perhaps we have ageing parents who needs financial support from us and perhaps some of us prefer a life full of people and interactions. Last but not least, perhaps some of us prefers to sleep in our cozy bed every evening. Wishing everyone to be happy with their choices.

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follow me on Twitter here.

written on 26 Jan 2019

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Happy Chinese New Year! May 2021 be an OXpicious year for all.

Happy Chinese New Year to all. Gong Xi Fa Cai.

Thank you for reading and supporting all these years. May we continue to grow higher, better and more awesome with every passing year.

Founder, Charles Tan.

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Happy Father’s Day!  You are the BEST, okay?!

No need many words. Just look at the image. If you are a father, wow, congratulations. I know it’s really not easy. We (you and me) gets this ONE (1) day in this whole year as our day.  They say the remaining 364 days are all Mother’s Day. Whatever… Today’s our day.  Happy Father’s Day.

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Happy Labour Day to everyone involved with property

Property Buyers / Investors.  I cannot imagine the world without you guys. Working hard, saving money and buying your first property, some go for the second one, minority buys non-stop and the richest buys the most expensive ones. Today, you should just wake up late because many of your usual agents are not going to work today unless you tell him that you are bringing your cheque book and is desperate to buy something on Labour’s Day.

Property Agents.  Yes, I am only talking about the licensed ones. Sorry brokers, if you are really serious, get yourself attached to a real and licensed agencies. Otherwise, do other things please because we seriously need more professionals in the field. I need agents who can give me advice based on what I want. Not just an agent who opens the door, stand by the side and pray that I buy. So, to any agents who believe he/she is a professional, Happy Labours Day! There’s no need to work today because I just told the buyers to wake up late.

Property Developers. You have planned for many months, sometimes even over one year. Then you submitted your plans and suddenly the market dynamics changed. Should you take back and resubmit? Should you change the plans from your RM750psf to affordable sizes and prices? Developers do a lot of work for a margin which seemed exorbitant but truth is, property development is not an easy game to play. Wrong step and it may just be the end. To developers who has vowed never to cut corners again this Labour Day, kudos to you. Happy Labours Day!

Real Property Gurus. Yes, I am talking about you. Anyone who has given a talk to over 50 pax and has managed to persuade someone to buy and that someone has profited from your advice, you are a property guru. Never be shy to tell those who needs expert advice that they have to PAY. I do not think any of those working full time as property guru are doing it for charity. Come on, even charities nowadays called themselves ‘Not-for-profit’ organisations and not ‘Non-Profit’ organisations. Without profit, every business would just close down! So, property gurus who does not simply tell people to buy, buy, buy but really educate them, Happy Labours Day!

Happy Holidays to all those who have yet to buy any property. No worries, I do think the number of affordable properties would increase tremendously compared to years before where not many were built. Alternatively there’s really nothing wrong to continue renting because by doing that you are not tying yourself down to something which actually is not movable.

Happy Labour Day yeah, everyone.

If there are people whom I missed, write to me. I will include you in next year’s Labour Day message. Haha.

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Happy Learning for free. Stay Home. All the 12 KopiTalks just for you.

the KopiTalk series started on 6th June 2020. Sr Michael Geh was then the FIABCI President (Malaysian chapter). He is now the immediate Past FIACBI President after serving for 2 years.  The KopiTalk #12 was on 8th August 2020. Our guest of honour for the #12 was Daniel Lee who gave us an insightful talk on personalities. Please do enjoy all the KopiTalk series. Feel free to click and watch them yeah.

the KopiTalk #1 with Sr. Michael Geh someone who tells you things as it is. This is why I like to learn from him everytime we meet. The most recent one? Supper in Penang! He is the FIABCI President (Malaysian chapter) and the topic was
Malaysia’s Economic Recovery Plan (ERP). Let’s do a DEEPer Dive! View it here.

the KopiTalk #2 was with my good friend, the co-founder of East Malaysia’s top property listing site, Elson Kho. We share the same love for Sabah even if he’s a local and I am half a local. he loves food too and yet… his size and my size is a sigh… for me. Haha.
Topic was “My Kota Kinabalu.” View it here.

the KopiTalk #3 is someone I have shared the speaking stage many times. He is so well known in Penang that I dare not go to Penang and not visit him. He is also a successful AirBnB operator too and his office is at his home. How nice.
Miichael Yeoh spoke about “Why Refinance? Good, Bad and Ugly”. Click here to learn.

the KopiTalk #4 was with someone who used to stay so close to me. I meant the house, okay. Carmen Loo, DTM who’s currently the highest ranking officer; District Director in the Toastmasters organisation of District 51.
She shared “Effective and Critical Non-Verbal Communication.” Click here to learn.

the KopiTalk #5 was with this Italian guy who’s more Malaysian than many Malaysian when it comes to defending what’s great about Malaysia. Dr. Daniele Gambero the Propenomist and also co-founder of the REI Group. He shared this,
“Malaysian property the best value in ASEAN, really?” Click to listen and learn. Click here to view
.

the KopiTalk #6 is someone who already owns something I hope to own some day, an orchard planted with durians! Down-to-earth very friendly and ever willing to share because he really want everyone to make decisions with good data! We have
Premendran Pathmanathan, the Founder of Brickz.my who shared, “Making Better Decisions with Data.” View it here
.

the KopiTalk #7 is this lady who is what we call a “cili-padi”. When it comes to the topic of protection (financial type), she speaks with passion and it’s coming straight from her heart. Elane Goh is the Founder and CEO of Vision One Hundred Consultancy.
She prepared a lot of slides and shared this, “Making sure our wealth is always safe.” Click here to learn.

the KopiTalk #8 is another lady whom I hold very high regards for. We have spoken in the same event a few times and she actually does not need slides. She’s a very prominent leader too and always want to do more for the society. She is
Agnes Wong, the Managing Partner for Syarikat Ong. She shared an interesting topic, “Expanding and in need of Fund Raising?”

the KopiTalk #9 was with this gentleman who’s extremely knowledgeable and yet very humble. He writes very eloquently at
livingspace.com.my
 too. Please visit and read many of his articles yeah. He is Ikhram Merican and he shared about the significance of the 18-year
Property Cycle and even gave many signs about the year which we are at currently. Watch it to find out yeah. Click here to view.

the KopiTalk #10 was the first time we look at health. These days, with the stress at work and the irregular hours which we eat, our gut may no longer be healthy. Our guest-of-honour is someone I have known for 15 years, from a young pharmacist to someone who owns a pharmacy and today, an established woman leader too.
Ms. Gina Koay shared on “Healthy Gut, Healthy You.” Learn from her here.

the KopiTalk #11 was someone who’s YouTube videos I enjoy a lot. He’s explaining about property developments in an easy to understand manner and you could feel his sincerity in the videos too. I learnt from him that it’s super important to be a professional and he shared a lot of tips which hopefully will help me build my own
YouTube channel too. Tan iHerng shared, ‘Becoming a YouTuber? Here’s the HOW to do it.” (view it here)

the KopiTalk #12 is someone who facilitated a leadership course for me many years ago. He speaks slowly and has so many things to share that I felt I must have him to share about something super important for all of us; personality. Our guest-of-honour is Daniel Lee and he spoke about “How do our personalities affect us?
Time to take charge. Many useful tips and it includes even how to handle your boss! View it here.

Happy viewing a total of 12 hours of lots of learning and it’s FREE… for you.

If you like to know the latest KopiTalks, click here to view them too.

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Happy 61st Merdeka Day my Malaysia.  Always ‘Setia’ to you.

If Malaysia is a working professional, 61 years old would mean the year that the person starts to enjoy his life or starts to worry for his future (retirement). I am just joking. We still have a 93-year old working Malaysian! Thank you as well my PM for telling me that 93 is just a bigger number. Let’s start to enjoy the positive sentiment and work ever harder for our dear Malaysia shall we? Despite the many worries about the relationship between Malaysia and China, the meeting between our Prime Minister Tun Dr. Mahathir and China Premier Li Keqiang showed a totally different story. Take a look at the image yeah. Facial expressions are everything I think.
(Google for the one for Merkel and Trump to understand..)
 As a blogger, I should do some writing for Merdeka day right? Okay, let me present a short poem for Malaysia this Merdeka Day.

The only country for me, my Malaysia

The country that I missed every time I am overseas,

The country that I devote my dedicated loyalty,

The country I believe is the best for me and family,

The country I love, ever since I was born in the 70s,

The country I will continue to love as I start my 40s,

The country I will be buried when I end my life journey,

The country is my Malaysia, you are my one and only,

Wholeheartedly, thank you for all the opportunities.

Happy Merdeka Day my Malaysia. Always ‘Setia’ to you.

I saw one nice video from
IOI Properties (Click here to reach their FB page)
 which I would like to share below. Happy viewing and let me know your thoughts yeah. If there are other awesome videos, please share too.

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Confidence is building back into property market Malaysia

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Happy New Year and what about another resolution?

It’s past midnight, so it’s now 2017. How many had just set your 2017 resolution? Property investment related? Making more money related? Or simply just buy that car of your dream? Please not just to buy new iPhone 8……Make a harder one.  Hey, I roasted turkey today. (Image) Haha. It was fun and merry and during conversations, nearly everyone I knew told me that they did not hit their 2016 resolutions. Well, maybe they set their resolutions too high. Or they set too few? Perhaps I am just too pragmatic. I have many different resolutions based on categories. So, I am bound to hit at least a few of them. Investment wise, I wanted to get a property and since I found something I like, I hit this resolution. For kopiandproperty.com, I was looking to hit 40,000 views per month by the end of 2016. It’s agonisingly close. Haha. 39,452. Highest ever since kopiandproperty.com started. I will consider this as hit too. 🙂  In my career, as I was put in-charge of a newly set-up team, I wanted to ensure the team learns fast and starts performing. Looking at my two managerial-level staffs today, I would say I have hit this too.

Okaylah, I failed in a few too. I wanted to hit 75kg. I am still at 78.5kg currently. Staying healthy is a priority because my kids are still so small. I really hope I can see both getting married and me holding my grandchildren. For property investment, I had wanted to get ready my Sandakan condo ready for rental. It is delayed. I had hoped that I could be more hardworking and write more articles for kopiandproperty.com It did not happen and my daily average remains the same. Come to think of it, all these failures were simply because I was just too lazy. Okay, now that all of you know that I must lose weight, we shall see what happens come 1st January 2018.

So, you see, 2016 is indeed a mixed year for me but I consider it a great blessing and just like all of you, I look forward to a ‘chicky 2017.’ (Year of the Chicken) When we look at hens, what does it teach us?
It teaches us that working hard is compulsory
 (it constantly searches for worms).

It teaches us that we must protect what we have
(it will sit on its eggs till it hatches). Last but not least it teaches us that the
focus is on long term.
(It lays one egg at any one time BUT it does this throughout it’s life.) That last message is important, stop thinking that everything will be fast. Investment will always be for the long term. Happy taking more concrete actions in 2017 my dear readers.

written on 1st Jan 2017

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Happy voting and tomorrow can start viewing dee…

Today, we rest a bit yeah. Just a very short article though there are already a number of saved articles. Mengundi itu dah pasti ya? Itu kewajipan kita sebagai rakyat Malaysia untuk negara tercinta ya. Here’s a nice song for everyone too.
Sejahtera Malaysia.

‘Seia, Sekata, Sehati, Sejiwa, Menghadapi Cabaran.’
Remember yeah, we are all Malaysians. I am now in Teluk Intan. Drove down my parents so that they could also exercise their rights. After this, will drive back to Ipoh to vote. My only little wish is that Malaysia continues to get BETTER and
hits the prediction of PWC for 2050.

So, what do we do after voting? Of course, go eat some good food and this evening wait for the results. What happens tomorrow then? Haha. Start making viewing appointments lah. Property investment takes a very long time and it starts with identifying and viewing yeah. Happy voting, eating and investing.

written in Teluk Intan, 9th May 2018.

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Hard for property prices to go down lah..

I read an article in The Star quoting a few experts who gave some views as to why the prices have not been trending downwards even though the total transactions have been going down since 2014. According to Jordan Lee & Jaafar executive director Yap Kian Ann, Selangor and Kuala Lumpur have a population of 7.5 million with 1.85 million residential units. With continuous urbanisation and migration from other states, these will continue to push up demand. According to Yap, the property market is not like a stock market. Any selling or buying takes time. Read my earlier article here:
You need Time for property investment (updated)

He then mentioned something very fundamental, “a roof over one’s head is considered a necessity”

Yap further elaborated that there are 30 other broad factors affecting prices and fundamentally, it’s based on demand and supply. Most important reason is location. The nearer to the city meant better accessibility and thus better prices. The next most important factor is interest rates. He said during the financial crisis, many central banks reacted by trying to prop up their economies and this is done by releasing more cash into the system. Low cost of financing meant better demand for property investment. Low interest rates also discouraged savings too. Due to these factors, there were some speculations which had to be cooled down. For example, in Singapore there were 8 cooling measures over a period of six years. In Malaysia, despite the many cooling measures, we can see that the prices have not really moved much, downwards.

Let me explain very briefly why it will be tough for prices to suddenly drop. There are many owners of properties who would hate to reduce their selling prices. These owners are mostly working professionals and as of now, we could see the unemployment rate remain low. In fact, the sales of luxury cars are on the way up even if the sales of ‘bread and butter’ cars are on a downtrend. The banks would also not like a sudden drop in property prices. The developers, despite trying to balance between the market requests and profitability would also not want the prices to drop suddenly. Yes, the buyers wanted the prices to drop. YET, all of them continue to only want to buy in certain areas. The equation would always be demand and supply. Sorry, it will never be average demand and average supply. It will always be location specific because this is where many buyers want and the supply being limited. Read here:
Property Prices too high? YOU might be the reason

I think Yap’s points are very valid. Perhaps he should also advise buyers to be much more rational and spread out the buying activities over more areas instead of only that few selected areas. Just look at the prices of today, especially the secondary market. Areas which are only 10km away from one another can be priced 2.5 times higher or more. Of course, I still believe that the price dynamics would change when the transportation modes change too. Read here:
MRT stations will change the area dynamics

Happy selecting and buying, regardless of the area that you really want or need.

written on 7 Dec 2015

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Finding it hard to sell your property? You are not alone

It is not easy to sell your property today, many say. I think they are wrong. We had over 75,000 residential property transactions within H1 2020 alone. Surely many are still selling and many are still buying and banks are still lending too. However, it is NOT easy to sell at the price we wanted. Perhaps during better times, that price target would have been fine. In today’s market, that price target may be unattainable. This is why the problem of selling the property at a good price is not easy. This applies even to multi-billionaires and not just us.

Photo by Maria Orlova on
Pexels.com

Article in nst.com.my
.
  Hong Kong property tycoon Tang Shing-bor is known as the “Shop King” for his vast holdings of retail property amassed over six decades. With rental income evaporating, he’s put a quarter of his family’s real estate portfolio — valued at about HK$75 billion ($9.7 billion) — up for sale this year, according to listings, news reports and filings tracked by Bloomberg.

Tang’s son, Stan Tang said, “When we have the need for capital and see a good opportunity, we will sell according to the situation.” He added, “Even though market sentiment is bad, property valuations haven’t decreased drastically.”

Alex Leung, a senior director at CHFT Advisory said, “You can’t sell at a good price these days,” said and Appraisal Ltd., a real estate consultancy. If the owner’s financial ability allows, they would rather hold the properties because it’s likely for them to sell at a loss now.”  Please do refer to the full article here:
Article in nst.com.my

Holding power remains essential

If I own 10 properties and all of these properties could not be rented out, I do believe I will be very motivated to sell and will be willing to cut my asking prices too. Of course the first step is definitely to reduce rental first so that my losses are minimised while I wait for better times to return. Once this starts to drain too much of my reserves, the next step is to sell a few of the 10 which I have profits and use these to cover the repayments first.

This is why when the owner could hold, the property prices will not budge much. Just look at the areas which is popular and everyone wants a piece of it. The prices have hardly changed even if everyone of our friends kept shouting that the market is bad or that it is now the buyers’ market. Whether it’s the owner, the banks or even the government of the day, dealing with a downtrend in property price is not a positive experience at all.

Conclusion

If you have trouble to sell your property, then do note that it’s an issue faced by more than you alone yeah. Even the super-wealthy would also have issues too. How to sell your property faster? Engage a good real estate negotiator lah. Plus read this article too:
Sell your property faster? Tips here
. Till then, all the best.

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Financial news: Harder to buy a property today or a long time ago?

Why are the older folks complaining that today’s rates are too low for their hard earned savings?

There was a time when depositing RM1 million in the bank as Fixed Deposit will gain the saver 8 percent of interest if not higher and that means this saver could get a monthly interest equivalent to RM6,667 per month. This is the typical salary of a M40 household. In other words, it’s actually possible to take it easy once we have managed to save our first RM1 million. RM6,667 is not a lot of money but certainly enough even for today’s typical expenses per month. I know, it’s much harder to get RM1 million then because the salaries are lower.

Why do some people say that it’s cheaper to get a home loan today versus a long time ago?

Take a look at the chart below. We can see that back in 2007 for example, the home loan rate could have been 5.75 percent or higher. I still remember once upon a time I used to have a rate of 5.5 percent for my home loan.

Meanwhile the typical rates for today would be something like the below:

Source: ringgitplus.com

Easier to buy today or a long time ago?

This is a very hard to answer question. The salary amount then and today is a very different number. The number of home choices then and today is also very different. The banks’ loan approval then and today is also very different. The urban migration we see today meant that growth in bigger cities are faster and some smaller towns may see less demand for properties too. In fact one additional thing which is very different then and today is that today there are online shopping, there are special promotion for airline tickets, there are also all the attractive BUY NOW PAY LATER schemes too.

So, if I can choose just one answer between then and now, it should be harder to buy today due to the many temptations of today. It’s not harder to buy a property today, it’s just harder to allocate funds for property nowadays. This is why more and more people may resort to renting and it’s already prevalent in many advanced countries around the world today. Final question is whether can these people rent if no one has a property to rent to them? Happy deciding.

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First may be hardest but aim at more than one

I bought my second property when I was 29 years old. It was three years after my first apartment which was just RM123k. I took nearly two months to decide because I was scared I would go bankrupt! When my parents learnt of my intention, this was their first question. “Is there any problem with your current home?” Their understanding of a property is that of a
home sweet home.

Simple right. You save, you buy, you stay and if can, let your children stay in future. True? Can still be be true. However, when we look at bigger cities which are still expanding or our flourishing career which may meant us working in different places, it may no longer be true. We may not be staying in the same house forever. Thus, the question is, ‘Is one property enough today?’ According to a HSBC survey, it has found out that many employees in Malaysia see a second property as a very important investment to ensure
they retire better.

I think their survey is true for only the minority of all home owners. The reason I say so is because
majority of everyone does not yet own their first property.

Thus, the survey would not cover them, yet. Yet, this survey shows something else too. Those who has bought their first property would most likely go for the second and these are the people who would retire much more comfortably later on compared to those without or even those with just one property. Seriously, the first property is always the hardest. no difference from when we first started our career, everything seemed so tough. After we have been in the same role for some time, things got easier.  Yes, we can also dream a little bigger. One property bought at just RM500,000 today and rising to only RM1,000,000 25 years later. Okay, it is also true that by then RM1,000,000 may be smaller in value than today but I still think it’s far better than someone without a RM1,000,000 extra property to their name. Agree?

Yes, some would now ask how sure am I about a RM500,000 property becoming a RM1,000,000 property in the future? Truth is, I have no idea. Do you? Some would even argue that if they save RM500,000 in FD today, it should easily become RM1,000,000 in future. Hey, this is also true! The only issue, do we already have RM500,000 today? If someone has already accumulated RM500,000 today and does not simply spend but simply invest in the usual unit trusts or even some blue chip counters, I think it should also easily hit RM1,000,000 in 25 years. However, for those who have started property investments, it’s also true that one property is not enough. One may be for own stay but another one can be for investment too.  My personal conclusion for myself, one property is certainly not enough today and for future. Happy investing.

updated on 10 Jan 2017

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The ‘harmai’ prices and development claim

Is is true that with more developments, prices would increase continuously? Perhaps up to a level deemed too high? If this is the case, perhaps we should not have developments. Should just stay at levels where everything is cheap and at worst, affordable. The reason this topic came up was because a colleague and I were talking about the price of ‘harmai. (dried shrimp)’ Take a look at the image beside. This kind of dried shrimp is considered a premium as it is of the whole prawn and its bigger too. Totally different from the ones we normally see in markets or hypermarkets where it’s normally already in bits and pieces and most of the time, ‘sandy.’ Even those would already be easily RM40 per kg or even higher.

I told her that the price of the dried shrimp this quality is just RM40 per kg at max. I was in Sandakan. She said that in her hometown, a small town in Peninsular Malaysia, this quality is at least RM80 per kg. She said the reason is because of the pace of development. Her hometown has grown very fast and thus the prices of everything has gone up. I replied, there’s no such thing. There’s just greed which was built up by the never ending demand. The buyer is willing to pay more for higher quality and the seller willingly sell higher every year, saying the costs have been increasing. Seriously, what costs?

Manpower? Well, I seldom hear of people receiving increments of more than 10 percent every year. Diesel price? If it’s diesel price, it should be reducing, no? Cost of boats? I am not sure if the cost of buying a boat in Peninsular is going to be higher than using a boat here in Sandakan. From my understanding, it’s usually cheaper to buy these kind of stuffs in Peninsular Malaysia instead. Oh, perhaps it’s because the sellers in Peninsular needed to buy a BIGGER home, FASTER cars. Do browse online and understand that prices of homes in Sabah on average is one of the highest in Malaysia, vs the average household income.

Since there are no further reasons, it comes back to just greed plus the demand. Can prices drop a bit? Yes, of course, with competition it would. Another way? Lower demand. Finally, when the prices have really become so unaffordable that the sellers have no choice but to sell lower. Think property developers who are offering rebates or even discounts which can reach double digits today. Remember last year I wrote an article about developers warning that with GST, prices will just have to increase? Sigh… Read here:
Increase selling price due to GST? It depends on margin

Honestly, in a hot property market, please get ready to book your unit in 3 minutes…. That’s the reality. Seriously, we should stop accepting the reasons that EVERYTHING is increasing in price because of development. Most of the time, it’s just because we are still buying, that’s all.

written on 16 Feb 2016

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Hartanah di Pulau Pinang sekitar RM250 ribu

Di Pulau Pinang, hartanah mampu milik sentiasa diperdebatkan. Begitu banyak komen tentang apa itu hartanah mampu milik. Sesetengah berpendapat bahawa hartanah mampu milik itu adalah hartanah yang harga silingnya RM400 ribu dan kebawah. Ada pula yang mengatakan harga mampu milik itu sebenarnya RM250 ribu dan kebawah. Ini artikel saya tentang apa itu hartanah mampu milik dan sama ada adakah terdapatnya hartanah sedemikian di Pulau Pinang. Bagi memudahkan semua, saya telah mendapatkan e-kalkulator dari Iproperty yang menunjukkan bayaran perumahan bulanan jikalau anda membeli hartanah berharga RM250 ribu.

Adakah benar terdapat hartanah yang berharga RM250 ribu dan kebawah? Dari pencarian di Propertyguru.Com.My, saya mendapati bahawa sememangnya hartanah rm250 ribu memang agak banyak. Untuk tujuan artikel ini kita akan cuma guna data berkenaan sekiranya projek berkenaan popular. Berikut adalah hartanah yang berharga RM250 ribu dan kebawah.

Mutiara Perdana apartment, Sri Wangsa apartment, Desa Permata, Desa Bayan, Vista Condominium, Taman Seri Sari (Sunshine Garden), Jelutong Park, BJ Court, Sri Impian, Villa Kejora, Sri Aman, Suria Vista, Tanjung Court, Azuria apartment, Jade View dan juga Taman Permai Kumbar yang keluasannya mencecah lebih 1,000 kaki persegi.

Saya dan isteri telah pernah melawat hampir kesemua hartanah yang tertera diatas dan saya berpendapat kesemuanya adalah agak sesuai untuk saya. Ada sesetengah yang lebih bersih, ada yang mempunyai kolam renang yang besar, ada pula mempunyai sistem sekuriti berasaskan kad akses tetapi tiada yang begitu buruk sehingga tidak banyak unit yang didiami. Jikalau anda sedang mencari hartanah berharga RM250 ribu dan kebawah di Pulau Pinang, tidak perlu risau, sememangnya hartanah berkenaan masih ada. Inilah hartanah yang saya katakan mampu milik.

Untuk yang inginkan rumah teres pula, bolehlah pula mempertimbangkan hartanah di Machang Bubok, Butterworth dan Bukit Minyak. Tetapi saya perlu memberitahu bahawa saya tidak pernah menjenguk rumah-rumah teres ini.

Saya bersama isteri tinggal di Villa Kejora untuk tempoh 4 tahun. Dalam 4 tahun ini, saya berenang di kolam renang beberapa kali setiap tahun, mengadakan parti BBQ dan juga bermain ping pong tidak kurang dari 50 kali. Saya rasa, sekiranya kita bukan jutawan, maka kita juga haruslah membeli rumah yang kita mampu. Janganlah kerana rumah, kita berhutang keliling pinggang. 🙂  Jikalau anda memang sedang dalam pencarian rumah yang berharga sekitar RM250 ribu, peluang masih banyak. Harus kita ingat, kalaupun kenaikan harga cuma 1 peratus setiap 2 tahun, itu pun sudah kenaikan RM104 setiap bulan! Masih inigin menunggu? Kebarangkalian harga jatuh itu memang ada sekiranya ekonomi dunia meleset tahun depan. Tetapi jika anda masih sedang menyewa rumah, saya rasa memang penting untuk anda mempunyai satu hartanah yang anda boleh katakan, ‘ini milik saya’.

Artikel seterusnya dalam Bahasa Inggeris:
Penang Property Potential

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Has COVID-19 changed property demand?

Property demand has to come from actual people in need of a roof over their heads. With the slowdown in property transactions having been around since 2013 all the way to end 2017, everything seemed bleak. Then, we had a very small increase in transactions in 2018 followed by another positive year in 2019 with the help from Home Ownership Campaign (HOC). This has however been stopped in its track because of COVID-19. So… has COVID-19 really changed the property demand?

Many people say after this, everyone will stop buying property for some time.  At the same time, they are also staying that everyone will be working from home. Hello… make up your mind lah.  Buy or no buy? 🙂   They also say property prices will drop.  However, I still have friends who are complaining to me why THAT particular property price still not yet drop. Haha. Spare cash is king but these buyers will still have to wait for the owner of that property to fall into financial difficulty first… right?  Let me share more with everyone yeah.

My slides are ready and prepared for this upcoming session.  Honoured to be invited by IQI to share my thoughts on this heavy topic. There will be lots of facts and numbers so that we have a base to start understanding what’s really happening to the demand for property. I will seek to answer this question on everyone’s mind. “Has COVID-19 changed property demand?”  At 830pm tomorrow, I will share this FB LIVE in my
FB page. (click here to LIKE yeah)
 See you tomorrow.

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