Positive news for emerging markets; that’s us too.

Emerging markets are countries which is still growing pretty fast. For example,
ASEAN countries except for Singapore.
Advanced countries would be countries that has grown so much many years back that these days, their growth are usually very low single digits, say 1%. In fact, it’s a cause for celebration if they do reach 2 percent GDP growth per year. Recently, the U.S had a GDP growth of 1.9 percent in Q2 2016. As for Malaysia, even with a
GDP growth of 4.5 percent as predicted by International Monetary Funds,
 it’s considered ‘nothing special.’ Most of my Malaysian friends continue to have jobs and continue to complain about how bad we really are despite the whole world which is really in a bad shape currently. Well, recent few weeks have been pretty encouraging. It seems that Bursa Malaysia is back in favour. Our Ringgit has been one of the best performers in Asia for 2017. (We were one of the worst in 2016….)  There’s a long article about why Emerging Markets are becoming favourable to investors. Read it in
TheStar here.

The article shared a few key points as follows:

1)  Morgan Stanley initiated Malaysia’s stock market at “overweight”. Key reasons include the boost from the upcoming general election and the increased spending on infrastructure.
(Notice all the LRTs and MRTs that is being built currently? As well as that highly shared
East Coast Rail Line?
 Yea, generally these are good for the economy. )

2) Private investments funded by China under the “One Belt, One Road” initiative will drive investments. Within 2016, China and Hong Kong contributed 40% to Malaysia’s foreign direct investment.
(I love China and I like Hong Kong. I think they are both making a good decision if they invest in Malaysia as a gateway to ASEAN.)

3) Corporate earnings will improve after three years of decline. Morgan Stanely estimated that profit grwoth would be up 8-9 percent in 2017 – 2018.
(Time to buy good stocks with a good business I guess. Buy and keep lah. Since an investment bank is saying that the profits are going to go up)

Seriously, it’s about time people invest and not buy due to some sentiments. US$ has risen against the world, perhaps too much too soon. Let it’s economy grow, a stronger currency is not a great help if they are thinking about getting more of their companies to build within and export to the world. Seriously, it’s double whammy if they were to do so. Yet, they are seen as less patriotic if they refused to. Well, can’t win everything right. Ringgit is at US$1 to RM4.34 level today (27th April 2017). This is a level that I have not seen for quite some time. I repeat BNM’s stance. Ringgit should just be allowed to be stable and used for investment purposes. Happy investing everyone.

written on 27 April 2017

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Positive news for Malaysian economy, share lah.

How’s the Malaysian economy doing? I would say not too bad but then again I am just a normal Malaysian citizen. To me, as long as the unemployment numbers remain low, then everything else would continue to flow, right? Okay, perhaps it’s better to see what international rating agencies are saying about us? This is one recent article in
asia.nikkei.com: S&P keeps Malaysia’s rating at A-, Outlook stable
  Generally, we are still under the investment grade yeah. Standard & Poor’s is still keeping Malaysia’s sovereign credit rating at investment grade A- with stable outlook. The reasons include a robust economy that mitigates risks from elevated debt burden and evolving fiscal policy. It said that Malaysia will most likely meet its budget deficit target of 2.8% of gross domestic product in 2018. GDP wise, it will grow an average of 5.1% from 2018 to 2021 backed by private consumption, investment, and exports. (Yes, positive rating from S&P)

S&P said, “The stable outlook reflects our expectation that Malaysia’s strong external position, monetary flexibility, and well-established institutions will remain in place following the change in government.”  S&P also said that the scrapping of GST will pose a challenge to Malaysia’s fiscal position because GST make up nearly 20% of government revenue and this has helped cut reliance on commodity revenue of the crude and palm oil exporting nation. It said, “The government will replace the GST with the Sales and Services Tax, which is a narrower program that we believe will raise only approximately half of GST revenue.”  S&P further shared that in the near-term, due to the higher petroleum revenue, contribution from SST as well as aggressive expenditure cuts, it should cushion the abolishment of the GST.

S&P also gave this very important statement, “We may raise the ratings over the next 24 months if the strong economic performance observed over the last few years continues and in turn produces a fiscal performance that’s better than we expected, reducing debt levels further than anticipated.” Besides S&P, two other international rating agency, Fitch Ratings also affirmed Malaysia’s A- ratings with stable outlook in May, while Moody’s currently rates Malaysia at A3 with a stable outlook. All these ratings are investment-grade.
Do refer to the article in asia.nikkei.com for reference.
 Is everyone now fully convinced? Haha. It’s okay, at least please feel assured that the Malaysian economy is really as per what was mentioned by our Finance Minister Lim Guan Eng yeah.
“Economy remains strong, fundamentals solid, says Guan Eng.”
 Happy investing yeah. Remember it’s for the long term.

written on 3 Aug 2018

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Positive news. Unbilled sales RM650 million and RM612 million new projects ready for launch in FY21

There’s many not-so-positive news about the property market. How about a dose of positive news from a property developer, Glomac Berhad which I think could represent some of the medium sized developers listed developers in the market. Glomac was established 32 years ago in 1998. Happy reading.

Press Release: Glomac Closes FY20 with Sales Of RM385m and Unbilled Sales Surges to RM650m

? New sales driven by 121 Residences and existing townships

? Unbilled sales surged to RM650 million, an increase of 37%

? Ready to launch RM612 million new projects in FY21 ________________________________________________________________

Glomac Berhad (‘Glomac’ or ‘the Group’) today announced its unaudited results for the financial year ended 30 April 2020 (“FY20”).

In FY20, Glomac reported a revenue of RM245.8 million, mainly driven by steady construction progress from ongoing phases at Saujana Perdana and Saujana Rawang, as well as Plaza@Kelana Jaya. The Group’s net profit* rose to RM37.2 million from RM14.7 million achieved in FY19 before adjusting for RM24.6 million fair value loss on investment properties.

As at 30 April 2020, Glomac’s cash position increased to RM176.6 million whilst net gearing decreased to 0.28x against shareholders’ funds of RM1.1 billion. Net assets per share attributable to ordinary equity holders of the Company amounted to RM1.42. In respect of FY20, the Board proposed a final single tier dividend of 1.0 sen per ordinary share subject to shareholders’ approval at the forthcoming Annual General Meeting.

During the year, the Group achieved new sales of RM385 million, an increase of 19% as compared to FY19. The improvement in sales performance was mainly driven by the success of 121 Residences serviced apartments and affordable landed residential phases at Saujana Perdana.

The commendable sales and financial performance during FY20 were achieved due to the
favorable product mix and strength of Glomac’s development
, which are strategically targeted at the affordable and mid-market segments.

Ongoing phases in Glomac’s development projects, such as Lakeside Residences and Saujana Perdana, have continued to be well taken up. The Group’s
high-rise residential product offerings such as Plaza@Kelana Jaya and 121 Residences were launched with much success and were very well received by the market.

Looking forward to the coming year, Glomac’s
performance is expected to sustain
, backed by
unbilled sales of RM650 million
and RM612 million new projects ready for launch in FY21. The new launches comprise strong mix of affordable high rise like GreenTec Puchong and landed residential projects at Saujana Perdana in Sungai Buloh and Saujana KLIA in Sepang.

On the macro front, the property market is likely to remain challenging as the Group recovers from the negative economic uncertainties brought on by the Covid-19 pandemic and its ensuing Movement Control Orders (‘MCO’). However,
the easing of the MCO and lower interest rate environment coupled with the reintroduction of the Home Ownership Campaign (‘HOC’) and Real Property Gains Tax (‘RPGT’) waiver
are likely to spur the primary and secondary housing markets in the coming quarters.

With the advent of MCO, Glomac has put in place more
aggressive marketing strategies, especially in the digital sphere.
Acknowledging the effectiveness of digital marketing especially amongst Glomac’s target audience, the Group
will push for a greater digital presence of the Glomac brand and develop it as one of the key marketing avenues going forward
. We will also continue to look at further enhancing customer experience via various campaigns and offerings.

Over the longer term, Glomac will continue to pace its new launches strategically, leveraging on a strong development portfolio with a potential estimated GDV of RM8 billion that will sustain the Group for the coming years.

*profit attributable to the owners of the Company
The strong sales performance during the year boosted unbilled sales to RM650 million as at 30 April 2020, a 37% increase from RM476 million in FY19.

— end of press release —

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Positive news? Without any doubt, YES.

A friend mentioned the other day that the Malaysian government must be ‘pushing up’ the ringgit because the election is near. Sometimes, I do wonder if the Malaysian government is really that capable. After all, there are so many things that the government falls short. Just read the Facebook comments to know more. Anyway, coming back to the ringgit’s rise. The reasons stated by most analysts thus far would be the depreciation of the USD which has caused the ringgit to rise against it. Well, I do not think the Malaysian government is more powerful than the biggest economy in the world. Definitely not yesterday, today, not tomorrow and not in 2020, yet. Anyway, let’s read from an expert instead of debating on whether it’s the ringgit.Anthony Dass is chief economist/head of AmBank Group Research.
Full article in TheStar here.

In brief, global growth outlook is still positive. The United States is confident with the state of its economy and is likely to raise rate three times in 2018, each by 25 basis points from the current rate of 1.5% to reach 2.25% in 2018 and normalise around 2.75%-3.00% in 2019.
(Comments: Yes, when the economy is strengthening, the central bank usually will increase the rate so that money is not used for SPECULATIVE purposes like pushing up stock prices or house prices to new highs and instead used only for actual capital investments into businesses for example)

Ringgit has appreciated by 8.6 percent against the dollar in 2017 BUT, it has actually depreciated by 4.5 percent in 2016. Main reason is because of improving macro fundamentals and a lower risk aversion. The full year average of ringgit to USD was RM4.30!  Yet, it ended 2017 with RM4.046.

Ringgit should stay healthy, in tandem with the regional currencies which is supported by a more positive global outlook, continued export momentum growth in the region and policy normalisation in some countries. This region’s fundamentals are in a much better shape compared with the 2013 taper tantrum period.  (Comments: Note ‘MUCH BETTER SHAPE’)

Ringgit versus USD in 2018?  It will be driven by favourable macro data such as firm economic growth supported by domestic activities i.e. private expenditure, broad base supply growth and exports; improving fiscal consolidation on the back of healthy macro fundamentals and prudent policies which should lower further the fiscal deficit/GDP to around 2.8% in 2018 from its peak of 6.7% in 2009; and healthy external reserves that surpassed the US$100bil mark on Aug 15, 2017 to US$100.4bil and as at end-2017, external reserves stood at US$102.4bil.
(Comments: Note all those macro data stated. As soon as those change for the negative, then of course ringgit’s rise will stop and perhaps depreciation may start. It should not be based on just sentiment alone. Reminder that we (Malaysia) continue to have trade surplus while the largest economy is still having trade deficits. It does not really make sense for continuous depreciation for a country exporting more versus one that seems to be importing much more compared to its trading partners. Without more demand for its currency, then why should it be appreciating?)

There is still a potential for ringgit to appreciate another 4-5 percent. Domestic fundamentals are also favourable too. The ringgit is thus expected to perform well. Lower base would be 3.88–3.90 while the best case will be 3.76–3.78 against the dollar.
 Full article in TheStar here.
Happy following and believing, regardless of your views.

written on 4 Feb 2018

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Positive Rental Yield in Kepong

I wrote on Kepong being as good area to buy today because the price has yet to appreciate too much, thus rental yield is still positive. Today I saw another property which should give a positive rental yield depending on how old you are. 🙂 A colleague said, ‘Kepong ar, aiya I don’t want’. It is ok. I would think some people would still want to consider. Do take a look.

Personally I have yet to view the condo but these days, it is so convenient to identify all the relevant condos with good rental yields and go view all at once. Set a good day and get agents to help. Everything requires effort, ok. Do not just sit, read and buy. If property gurus in the market knows everything there is, why would they need to change their predictions many times based on changing circumstances?

Some additional information on Kepong. Kepong is just 6km from city centre. In terms of jams, do not worry, there’s jam everywhere in KL anyway. Kepong has the following highways passing through it. Jalan Ipoh, MRR2, LDP, DUKE and Jalan Kuching. Two weeks ago, at around 6pm, I arrived in the Kepong area in less than 20 minutes. My office is in nearby SOGO.

If I do buy one, will update but it will not be so soon.

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HIGHEST since October 2008! Positive for the Ringgit, hopefully?

By the way, the strength of a currency SHOULD depend on the trade. The higher the exports, the higher the demand for our currency and the value should appreciate. It should NOT be based on speculative stuffs. As a trading nation, Malaysia is ranked 25th out of over 200 countries in the world. Yes, for a country with a population considered small, we are really punching above our weight thus far. Malaysia has been having trade surpluses since 1997 and our positive trade surplus for September 2018 is the HIGHEST since October 2008. In September, we exported RM83.05 billion while imports declined to RM67.78 billion. This gives us a trade surplus of RM15.26 billion.
The article in NST for reference here.

Oh yeah, that largest economy in the world whose currency appreciated against the ringgit? It’s trade deficit was the reason it started a trade war with China. In a statement, International Trade and Industry Ministry said expansion in trade was seen with major trading partners, namely Hong Kong SAR, Asean, Taiwan, Australia, Saudi Arabia and the United States of America (USA). The higher exports was driven mainly by higher exports of electrical and electronic (E&E) products, chemicals and chemical products, iron and steel products as well as optical and scientific equipment, it added. For the first nine months of 2018, total trade expanded by 5.5 per cent to RM1.382 trillion compared to the same period in 2017.
The article in NST for reference here.

It’s the new Malaysia. Hopefully more Malaysians forward these positive news instead of just the negative ones. Frankly, the unsold numbers are NOT that negative for some states, especially Selangor and Kuala Lumpur. Image attached. Could it be better? Of course, when the property mismatches are reduced, it will be. Especially on the pricing part for which most developers are already aware.
Latest launches are mostly below RM500,000. Earlier article here.
 With lower priced units and an improving market sentiment, then the unsold units would naturally go down further. Happy understanding and… forwarding.

written on 4 Nov 2018

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Slightly earlier but worth reading: Positive news? Without any doubt, YES.

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Positives for Malaysia, stock market and Ringgit

Following was a positive news reported in a local media recently. For the first 6 months of 2016, the total outflows by foreign investors only amounted to RM48.6 million in total. Yes, this is considered extremely healthy. In 2015, there was a total of RM19.5 billion net outflows while in 2014, it was RM6.5 billion. One fund manager was reported to say that if investors are looking for yield, they would naturally return to emerging markets. Malaysia is one investment destination which is assured.

Another bank-backed research house pointed out that for the first five months this year, the foreign investors had steadily been holding about 22 percent of total shareholdings on Bursa Malaysia. he said that should there be any surprise upside in new economic data, some major inflows may be coming back for popular Malaysian blue chips. He prefers utilities and real estate investment trusts because of more predictable revenue base and good dividend prospects.

For those who bought unit trusts, do note that as per MIDF market data, the local funds have purchased at least RM3.97 bil worth of shares in each of the past seven weeks. As per the research house, these are some of the companies which has seen major inflows. They include Malayan Banking Bhd, CIMB Group Holdings Bhd, Bumi Armada Bhd and Top Glove Corp Bhd. Regardless of what the analysts and the foreign investors are doing, always note that Warren Buffet has this to say. “A good business would soon be reflected in its share price.” In other words, stay focussed on
good companies with strong business fundamentals.

Stocks were not the only positive. Ringgit has been on an uptrend too, despite falling right after Brexit referendum. Today (11 July), Ringgit closed at RM3.993 versus US$. (Yes, BELOW RM4 mark). It’s also a huge relief financially for those with kids in Britain. It’s now RM5.13 per Pound, substantially lower than right before Brexit results. Foreign investors bought local bonds ahead of
BNM’s monetary policy
 meeting later this week. The five year yield is now at 3.243 percent, the lowest since June 2013. Do note that for yield, the lower is better. It meant investors are more confident with the country and is not buying because of extremely high yield which may also indicate the riskiness of such bonds.

End of positives report for 11 July 2016

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Positives. Indirectly showing the potential for Kuala Lumpur

Source: Google.com

When I started travelling to Singapore for meetings 20 years ago, there were just one choice of flight. The ‘partnership’ of MAS / SIA. The price was also exorbitant. If I remember correctly, around RM800 per return trip. These days, I could fly 4 return trips and still have change for many lattes in Starbucks. Please take a look at the prices on the image. In fact, of the airlines listed, only two were familiar names when I first started taking flights to Singapore business trips. The rest are all newer and well, low-cost airlines which have now spread across the world even.
As a group, AirAsia has exceeded 200 aircrafts.
 It was started in 1993.
Malaysia Airlines meanwhile has 78 with another 31 in order.
 Fireflyz has 13.
Singapore Airlines has 115 planes and if we add both Scoot and SilkAir,

the total planes are still below 200. Of course, profitability wise, low cost airlines’ margins are still much lower but on an overall basis, it’s now very formidable.

Coming back to the potential for Malaysia as an awesome place where everyone comes in and goes out. It was reported in many media that the Singapore-Kuala Lumpur route is the world’s busiest international air link. There is a total of 30,537 flights recorded between the two cities in the 12 months by end-February 2018. (As per Straits Times quoting industry consultancy OAG). On average basis, there are over 80 flights daily between these two cities. It is thus a flight in less than an hour everyday.  After this busiest route, there is also the air links between Hong Kong and Taipei and between Singapore and Jakarta, which had 28,887 flights and 23,704 flights for the same period, respectively. Mayur Patel, OAG’s regional sales director for Japan and the Asia-Pacific, said that 14 of the world’s busiest 20 routes, including eight of the top 10 routes, are between Asian cities. He added that Hong Kong was the busiest Asian airport hub, featuring in six of the top 20 routes while Changi Airport featured in four.
Full report in StraitsTimes here.

There are reports saying that the High Speed Rail would probably ‘murder’ the airlines when it’s completed in 2026. Frankly, when we look at the connections, the most important factor is not more connections (supply) but more on the demand (people). The estimated total population for Greater KL would be 7.2 million with expectations that it will grow to 10 million by 2020.
Estimation is by InvestKL.
We assume that their estimation is not conservative enough. We assume that we will only reach 10 million by 2026?  This is an additional 3 million population. We assume that only 1 percent of this population would want to take the HSR once per month. The remaining 99 percent are all airline supporters. In other words, we have 100,000 people using the HSR per month or 3,333 passengers per day.
On a one way travel, the HSR can take 1,000 passengers.
 In other words, even at this rate, the HSR must have a minimum of 4 services per day IF only the Malaysian side would have people thinking of going Singapore.

By the way, there are 8 stations along the way which meant that there may also be passengers from all these other stations and it does not necessarily need to be only passengers from Kuala Lumpur.
Happy understanding that HSR and airlines

should be able to survive together, as long as both have good planners and value-add services at a competitive pricing. Nope, we do not need to even talk about the
potential for the Greater KL property market

because it’s a given when the number of people travelling into KL increases by leaps and bounds. Hey, we should organise a trip where all kopiandproperty.com readers go to Singapore together. Hopefully by then, I could treat all the readers a cup of coffee yeah. Keep this article!

written on 7 May 2018

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Possibility of a strong property market recovery? Yes, 2022 as per this survey.

Do I believe in predictions for the property market? What about for a strong property market recovery? Well, sincerely, not really unless the prediction corresponds to my own prediction. Haha. Anyway, it’s not just me. When we believe about something, we will always find evidence to validate what we believe. Now do you know why as soon as you start reading negative news, FB will start bombarding you with even more negative news? Not just negative news, can even be about your political affiliations too.

Photo by Andrea Piacquadio on
Pexels.com

Now, what will be happening to the property market then? Is there a possibility of a strong property market recovery? Let’s read the press release by Juwai-IQI below.

Press release:
INDUSTRY PREDICTS STRONG REAL ESTATE RECOVERY IN 2022 WITH 10.6% PRICE GROWTH: JUWAI IQI SURVEY

The new Property Survey and Index Q3 2020 by Juwai IQI, which is Southeast Asia’s largest proptech group and operator of real estate super-brands Juwai and IQI Global, reveals that the Malaysian real estate industry expects a strong market recovery in 2022, while forecasting national price growth of 10.6% through the third quarter of 2022, despite a -4.8% fall over the next 12 months.

THE SURVEY
A total of 344 Malaysian real estate agent panelists participated in the survey online between 16 June and 10 August 2020.

KEY FINDINGS Strongest Price Growth in Penang and Perak
The industry has forecast that the states with the strongest forecast price growth over the next two years are Penang and Perak, with price growth of 15.9% and 14.3%, respectively. Kuala Lumpur and Selangor are predicted to have the lowest forecast price growth over the next two years, with a lower but still impressive 8.5%. This is despite the National Price Expectations Index showing a downwards trend with a -4.8% fall over the next 12 months, before climbing again to post a cumulative growth rate of 10.6% over the next two years.

Lower Rental Rates Now, But to Increase in 2022
On a nationwide basis, rents are expected to drop 3.8% over the next 12 months, before recovering to post 7% growth through Q3 2022. Perak is projected to see one of the highest increases in residential rents over the next two years at 16.7%. Kuala Lumpur and Selangor are projected to see a 4.4% increase in residential rates.

More First Time Home Buyers
The share of new home transactions attributed to local first-time buyers increased by 4 percentage points to 34% this quarter, while the foreign buyer share fell by -7 percentage points to 14%. Local upgrading buyers and local investors maintained their shares at near equal levels of approximately 25%.

First-time buyers have claimed the largest share of the market in Sabah, where they account for 39% of transactions. In Johor and Sarawak, first-time buyers account for 36% of transactions. Local investors take the largest market share in Perak, where they account for 36% of purchases. Foreign buyers are most visible in Penang and Johor, accounting for 17% of transactions in both places.

Spike in Local Investors Expected
Perak, Johor, and Sarawak are the states where the industry has the highest expectations for growth in local investor transactions. In Perak, 78% of respondents expect local investors to complete more transactions in the year to come. In Johor and Sarawak, the corresponding numbers are 69% and 65%, respectively.

EXECUTIVE QUOTES

Kashif Ansari, Juwai IQI Executive Director, said:
“COVID-19 and the resultant economic slowdown has had a significant impact on the real estate industry’s outlook for residential prices over the next 12 months. The survey findings also show that the real estate industry believes the market will recover. Higher price growth and rental yields are projected.

“In fact, COVID-19 has made everyone think deeply about how and where they want to live. People have been spending so much time at home and now have a very clear vision of what they want. In many cases, what people want now is different than a year ago. Now, your home has to also be your office, your school, your gym, and your restaurant. The home has now become a hub for every activity.

“The fact that first-time local buyers have increased their share in transactions demonstrates the need for homeownership. This also shows that the government’s stimulus measures meant to support this group have been effective. The Government has made it easier for first-time buyers to acquire their first home with the reintroduction of the Home Ownership Campaign.
“The survey findings reveal that the appetite for property is resilient despite Coronavirus-related restrictions. Recovery and a return to growth are coming by 2022.”

— end of press release —

Briefly, the press release is saying that there’s a possibility of a strong property market recovery, not so soon though. We believe what we believe and we should take actions yeah. So, if we believe there’s a possibility of a strong property market recovery then… happy searching and viewing.

Please refer to the file attached for the full report about this strong property market recovery. (Yes, a long one)

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Potential 100% growth in property prices – Buy now or how?

I read this in Daily Express (26th Feb). No, this is not Greater KL or Penang or Iskandar. This is Kota Kinabalu which is the third highest in Malaysia in terms of increase in property prices. According to Francis Goh who is Shareda’s President, for the past 5 years, prices in Sabah has surged between 100-150% in prices and this is expected to continue for the next five years. As an example, the price of a double-storey terraced house with a built up of 1,200 sf has increased 114% or RM600,000 between 2007 and 2011. Besides landed properties, the prices of walk-up apartments, medium end condominiums have also increased between 50-94% over the same period of time.  RM 1,500 per sq ft.

Goh also said that the current new units of 10,000 properties of all types are still insufficient to cope with the demand. This is because Kota Kinabalu’s population of 800,000 is growing by 5% every year which meant 40,000 new population. That is the reason why the new properties growth of 10,000 per year is hardly sufficient.

Another reason why the prices of properties have also increased is because today, the price of land within three-kilometre radius from the city centre now costs between RM300 – RM400 psf or between RM12 million and RM16 million per acre! He also added that even at this price, it is tough to find because these prime locations are becoming rare. In 5 years time, it would be difficult to look for condominiums close to the city because there are simply no land remaining.

If the growth is indeed 5% every year moving forward, it means that the insufficient supply situation would continue and may get worse unless the supply is increased much more than current situation. Even if we take a ratio of 1:4, at minimum, 10,000 properties can only cater to the 5% growth, without taking into account the needs of the current population, of upgraders and even MM2H requirements though little as they may be.

Personally, I have a small condo in Kota Kinabalu. If what Mr Goh said is true, should I really consider buying one more? However, for those who are thinking of buying today, the prices are already very high. It may not be near KLCC or Penang’s Tanjung Seri Pinang but if KK is benchmarking the highest points in Malaysia, it may not be too long when Mr Goh’s prediction comes true.

written on 24 march 2014

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Potential 1,000 new PR1MA low cost homes cancelled, new plans?

A few weeks back, I read about Ivory Properties announcing that it has won the rights to redevelop Plaza Rakyat and that the GDV was going to be RM8 Billion. This is indeed a huge project for Ivory Properties which is one of Penang’s very own homegrown developers. I have personally bought one property from them before. Quality is not the top end but then again, based on the price I paid, not too bad. This redevelopment was supposed to have included up to 1,000 units of low cost homes under the PR1MA scheme. Kuala Lumpur City Hall (DBKL) has other plans because they said that Ivory Properties was not appointed by them but by Plaza Rakyat Sdn Bhd (PRSB). Since the JV with PRSB has been terminated in April 2010, it meant that any decision made by PRSB is no longer valid.

From Ivory, its CEO Datuk Low Eng Hock said that  they are still interested and willing to negotiate with the city hall in order to achieve a win-win deal for all parties involved. “We hope to meet up with DBKL soon to inform them about the details of our acquisition and rehabilitation agreement (ARA) with PRSB.” The initial plan was to turn the Plaza Rakyat into a mixed use development consisting of a mall, hotels, serviced residences and most importantly, a 1,000 unit low-cost homes in collaboration with PR1MA corporation.

Okay, my personal view is simple. If it is true that with this plan, 1,000 new low-cost homes would be built, then whoever DBKL decides should match if not better this number. Come on, if the authorities are seriously looking to tackle the lack of affordable properties, then please decide on a plan which incorporates these units and not one which may seem to profit DBKL but the number of units of the low-cost homes are either reduced or worst still, none built. Let’s watch this closely and see what’s the final plan going to be. Higher GDV, higher number of low cost homes and a new developer taking this up? I hope so.

written on 27 June 2014

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Accommodative stance needs a further boost, lower OPR?

Let’s look at a few predictions first. Recently, World Bank cut its earlier projected 2.9% global economic growth forecast in to 2.4%. The 2.9% forecast was just few months ago in January 2016. In April 2016, International
Monetary Fund (IMF)
 revised its global economic growth outlook for 2016 downwards, from earlier forecasted 3.4% down to 3.2%. The Organisation for Economic Cooperation and Development (OECD) had earlier predicted a growth forecast for the combined 34
OECD countries at 2.2%
. It has revised this downwards to just 1.8%. Suddenly, we have another world concern, BREXIT. Okay, the outlook is gloomy, what can Malaysia do?

Let’s look at what some experts are saying. RHB Research’s chief economist Lim Chee Sing told The Edge Financial Daily said that policy makers and economists are hopeful fora better H2 2016 but this is not assured. Besides that,
weaker global growth
 will point to a weak export outlook for Malaysia. Due to this weaker export it will culminate in dampening domestic demand and economic growth over time. While the government is predicting a growth of between 4 to 4.5%, RHB Research is expecting a 3.9% for 2016. What about the positives? Lim said the economy is however supported by the sizeable infrastructure-related projects under the Economic Transformation Programme such as the mass rapid transit lines, light rail transit Line 3, the Pan Borneo Highway, and the Pengerang Integrated Petroleum Complex in Johor.

HSBC Global Research expects a 4%
GDP growth for Malaysia in 2016
. This is in line with what the government is expecting. However, it has lowered its own forecast for 2017 from 4.3% GDP growth down to 3.8% instead. It expects Bank Negara (BNM) to cut OPR to 3% during its Sept 7 monetary policy meeting. Two negatives are BNM’s foreign exchange reserves which are said to be “thin” as well as a high level of household debt. Politically, it expects little change in the near-term. Positives include a robust consumer spending thus far, from Q4 2015 to Q1 2016. It may not be sustainable because of weak consumer sentiment. Another positive would be all the infrastructure projects under the Economic Transformation Programme with participation from the private sector.

I think it’s clear that perhaps relying on exporting more in order to grow may be tough. It’s time to stimulate the economy domestically, at least for a while till the world gets back on its feet and starts running.
MRTs and LRTs
 MUST be on track because all these are enablers and catalysts for business growth. A little adjustment to the OPR is definitely positive and it should be done quickly because this window will not be around forever. Just last year the talk was on increasing the rates to “defend” the Ringgit from its fall. Fortunately, our former
BNM governor Zeti
 did not do it because it was never about the Ringgit from the beginning. It was about expectations of the largest economy in the world, that’s all. Happy believing and if not, happy taking actions.

written on 9 July 2016

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Potential bond investment with 4-5% stable returns?

Fancy a 4-5% return every year? Assuming, it’s stable and recurring? Well, there are a lot of people having Fixed Deposits with 2% returns today.

I do think most people would think it’s too low. As someone at 44 years old, I think I do agree as well. I mean,  4-5% returns per annum? Even if it’s stable, it’s still too low. Well, if we look around the government bonds from the US to the UK to Germany, Japan and Australia, then this 4-5% yield is REALLY SUPER HIGH. If we look at the typical Fixed Deposit Rates of today (year 2021), then this 4-5% yield is double or more. Briefly, it’s high enough due to the current low interest rate environment. Then again, this is the perspective of someone who just want a stable return, year after year.

For the rest needing much higher returns, bond fund is definitely not a good choice. Here’s one more potential return which is like a bond. It is speculated to give 4-5% returns every year.

Article in theedgemarkets.com
  Gamuda Bhd confirmed today that it is currently in talks with the government to put forth its proposal to sell its four highway concessions to a private highway trust. to be known as Amanah Lebuhraya Sdn Bhd.  This trust will fund the acquisitions by raising money from bond investors with a promised annual return of 4% to 5% backed by cash flows from the tolls without any need for government guarantees.

Gamuda also said, “We also affirm that the proposal involves keeping the current toll rates unchanged with no further increases, with a short concession extension in order to fully recuse the government from paying any compensation (as is legally required of them as per the current concession agreements) for keeping the toll rates as they currently are, for the entire proposal period.”

“In our proposal, the government would have no stake nor interest in the buying entity, and therefore need not spend any of its own monies in the acquisition and further, need not provide any government guarantee.”  Please do read the full article here:
Article in theedgemarkets.com

Paying toll, yes. Earning returns is yes too.

If you ask me if I prefer to pay higher toll but with a shorter period, my answer is to pay the exact same toll for a longer period of time. Let’s remember that with diminishing value of money, the RM2.50 we pay today will be way lower than RM2.50 10 years down the road. Our salary would have been higher too. This is why I think this proposal from Gamuda is fine and in fact some people with money in FD may switch some of their FD into this bond for a higher return instead. Now, we just need to wait for more details since this is already in progress.

By the way, this is as low risk as it could be already yeah. The tolls should retain its popularity and whether we drive a petrol engine car or an Electric Vehicle (EV) we still have to pay toll. This will also enable Gamuda to get back ‘firepower’ for their other businesses. Meanwhile, the government can now move away from having to subsidize the toll operator just to ensure the toll charges stay the same year after year. Till we have the next update, take care.

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Potential cooling measures and the rush to buy properties

Potential cooling measures

Cooling measures are usually steps taken by the government to cool down the market. It could to cool down the stock market, it could be the property market. It could be just the market in general. One such cooling measure for example would be the removal of Developer Interest Bearing Scheme (DIBS) many years ago because there were too many speculative property purchases happening in the property market then.

Another one would be the Real Property Gains Tax (RPGT) which was introduced so that buyer would have to hold the property longer, else they would have to pay tax if they sold earlier than 5 years. In some advanced property markets, they even have taxes levied on buyers and sellers and this is not like RPGT in Malaysia which will only be applicable if there are profits. The taxes are basically applicable to all property transactions. Thus, if there are signs for such cooling measures, the market may react with intensity to quickly complete the purchase.

Article in channelnewsasia.com
.
 According to statistics released by the Urban Redevelopment Authority (URA) on Monday (Feb 15), sales of private residential units increased by about 32% versus a month before. (WOW) If it’s based on year on year basis, then new home sales in January 2021 is 159.5 percent higher!

Ms Christine Sun, head of research and consultancy at OrangeTee, said that the figure was the strongest January sales since 2013, when 2,028 units were transacted. She said that the buying rush to speculation of potential cooling measures. She said, “Even if cooling measures were not implemented, buyers may still be in a better position to ink a unit sooner rather than later as prices of homes are likely to rise further since the global economy is expected to pick up this year.” To read more details please read in the
Article in channelnewsasia.com

When the country starts to break free from COVID-19 effects

Do not get me wrong, Singapore has just started vaccinations and it will likely take a while. Probably towards Q3 of this year if everyone follows their schedule. This meant that COVID-19 worry remains. However, what has happened is that when things start to get better, people do continue to buy what they needed. Perhaps it got delayed from 2020 but demand has now restarted.

When a similar situation starts to happen in Malaysia

If we are looking at a similar situation, then this may also be something which will be coming too. Not just the demand for property yeah, also the cooling measures too as soon as Bank Negara Malaysia (BNM) felt that there’s too much speculative buys in the market. Happy understanding and deciding. If anyone wanted to say, ‘but Singapore market is different from Malaysia…’ My reply is a simple one. During the H1 2020, our residential transactions alone topped 75,000 units. I rest my case.

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Potential first, excuses last, that’s important

Have you heard of this quote before? “Buying a home today is a complex process, but that in no way excuses home buyers from their obligation for due diligence – Henry Paulson” Read more quotes here:
www.brainyquote.com
  Do google to know who is Henry Paulson. Quite a famous person from the finance industry. Due diligence means actions, concrete ones. It means understanding what we buy before we buy. The quote also tells us that we BETTER buy, somehow. Speaking about buying,
Selangor Dredging
 has just bought a Singapore property for RM223 million.
Full report in TheStar here.
It’s a parcel of land measuring 17,442 sq ft. There’s a 7-storey building on it now which without any doubt will be demolished for something much taller I guess. One acre is around 44,000 sq ft.  So, this is around 0.4 acre. SDB bought another piece of land earlier in December 2016. It was a 31,705 sq ft parcel of freehold land in District 12 for RM146.9 million)

The question some of my friends should ask would be this. Not a question to SDB but a general question which has always been a topic; ringgit. In fact, Ringgit is now at SGD1 to RM3.10  Why are developers still buying in Singapore since this will be 3.1 times more expensive!  I think the answer should be what would be the potential for these acquisitions. Anyway, according to the article, this is what SDB’s managing director Teh Lip Kim shared. SDB had successfully completed five projects in Singapore so far. She said, “These two additional parcels would result in SDB having a total of seven property development projects in Singapore very soon. Our team will commence with the development conceptualisation and planning in the immediate future, and we aim to launch both the projects within the first half of 2018.”

Decisions that we make should always be on the

potential return in the future and not INSTANT returns.

One pertinent question is this. 3-5 years later, what should happen to the property market if the world wakes up from its current half asleep state? Of course as at today, the situation in the Middle East with Qatar in the centre of attention meant that stability is at stake. There are also many other unfortunate incidents in the UK and other European nations which meant that as far as short-term is concerned, it is not looking bright. Let’s not forget that world leader who loves to tweet. I just finished a Whatsapp with a close friend 10 minutes ago. She said, ‘I am saving for my next property.’ She owns two high-rise units near KLCC today. She is positive with her future property investment in Malaysia. SDB is also positive about their future developments in Singapore. I remain extremely positive with Malaysia’s growth. Hopefully, all three of us are right.

written on 7 June 2017

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Source:www.calculator.com.my

“Potential has a shelf life. Unleash it earliest possible.”  Someone wrote this on her Facebook timeline sometime back. I think most of us would have to agree that the sooner we start the better it will be for our investment journey or our future retirement. For example, RM200 may not be a lot but if we save it without fail every month, we are going to get a good surprise when we retire. This is if we do not change the amount at all and does nothing to it at all. In terms of RM200 today? Well, that’s not even 5 percent for a new iPHONE X yet. Haha. Anyway, just be reminded that savings is always that start to an investment journey.
Please do not take up bad debts even if it is to buy good debts.
Now, let’s take a look at property investment and what is possible in the near future

The affordable property prices of today would be “undoable” in the future. With the same price, the future developer (maybe the son of today’s CEO) will not be able to maintain the same size and would have to build smaller units. Land prices are increasing with every transaction. The new units could however be close to the city centre due to
redevelopment of old developments of over 50 years for example.
The 20-storey dilapidated flat that is an eyesore along some roads in KL today could be torn down and a new 60-storey development takes over its place. Instead of the 200 plus units, it may now be easily 2,000 units of smaller but more functional homes. Common facilities and walking distance to some public transport stations. Prices for these smaller homes would be within the affordable range AT THAT TIME. The buyers may include the sons and daughters of buyers of affordable home today.
PR1MA
,
Rumah Selangorku
 and even
RUMAWIP
. This is why if we could afford the property of today with the money we have today, unleash its potential because the property price and even the money we have today have a shelf life.

When we are younger, we could also afford to work harder. We could do more. We could put in more hours. We could even drive GRAB during our spare time. What’s wrong with getting an additional RM1000 per month of which if we invest just half of it, we are looking at over RM300k when we retire.
Just do not do the same thing every year

and then realised after ten years that we have not grown much in our careers. It is true that all of us have lots of potential. Very few of us could become the next Jack Ma or even Tony Fernandes. However, all of us with the right attitude and learning would become the next multi-millionaire. The only catch is this. “Potential has a shelf life. Unleash it earliest possible.” Happy unleashing.

written on 23 Sept 2017

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Summary of the potential of ‘twin deficits risks’ for Malaysia

Today, I read a good article summarising the potential of Malaysia having twin deficits soon. If you do not intend to read the content, in brief, this twin-deficit will not be happening within 2016. Overall, the article is a little long and thus the summary plus my personal opinions as below, the good, the not so good and the still okay. If you prefer to read full article, then it’s
here.
 Summary as below.

The Good.  Malaysia is still running a current account SURPLUS. Our exports are still higher than our imports. In brief, we import raw materials, added value and export them for a higher price than we paid for. So, we have a surplus. Yes, there are LOTS of countries running fiscal deficits today which have by far higher sovereign rating than Malaysia. Don’t ask me why…

The Not So Good.
 World growth is really lethargic
. Our exports cannot increase because the world demand is low. Imports will increase as we need to build MRTs and LRTs plus all those foreign labour are sending money home….. Delay the MRT and LRT? The answer is NO. Let’s push forward.

The Not so Good. Malaysia has been running a
fiscal deficit
 for the past 18 years. In other words, as soon as the trade account surplus becomes deficit, Malaysia would have ‘twin-deficits.’ Double whammy so to speak.

The Good.  Hong Leong Investment Bank Research economist Sia Ket Ee said, “The risk of twin deficits is not so apparent for this year, but as we move into next year, Malaysia will face the likelihood of twin deficits. LNG are being exported at lower prices and yet imports of capital goods are increasing with Mass Rapid Transit (MRT) Sungai Buloh-Kajang Line’s final stage.

The Not so Good. UOB Malaysia economist Julia Goh said, “The downside risk has certainly increased because the picture of the external environment is very negative.” Again, we can’t control the world.

The BAD. If Malaysia falls into a twin-deficit situation, it could trigger a
credit rerating for Malaysia.

 If this happens, Ringgit may weaken further. For those whose children are studying in the US, this may be a big issue. UK and Australia? For those in the UK, it has been ‘better’ after Brexit. As for Australia, do take a look at some of its economic outlook to understand more.

The Good. Mier executive director Dr Zakariah Abdul Rashid shared MIER’s projection.  Malaysia’s current account surplus for 2016 in total will likely narrow to RM11.3bil, or 1.2% of the country’s gross national income (GNI), from RM34.7bil, or 3% of GNI. (Yes, still in the black lah)

The good. HLIB’s Sia said that the Malaysian government has a little more flexibility to pump-prime the economy because in the recalibrated Budget 2016, the crude oil price was assumed to be US$30 – US$35 per barrel. In a recent report, Goldman Sachs predicted that the
crude oil price
 will remain in the U$45-U$50-a-barrel range till mid-2017.

Happy following.

written on 30 July 2016

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Potentially another CUT in May 2020. Happy? (COVID-19 is one reason)

Let’s just say that I am not always a happy man every time the Overnight Policy Rate (OPR) is cut. I know, the monthly mortgage gets lowered but lowering of rates also meant that the economy is not at where it should be. Thus, monetary policy tweaking is needed to sustain the growth or to support the weakness in growth so that we do not fall into any potential minus GDP potential.

Briefly, when the economy is booming with very strong positive sentiment, it may start to attract speculative buying and that’s when the interest rate may be increased in order to induce more people to save their money and thus reduce the pressure on prices to keep moving up; inflation. So, when the economy is not attracting a lot of people willing to invest in its growth, the rates are lowered so that people will prefer to take out their savings and invest into potential growth instead. This is what is happening today.

Article in themalaysianreserve.com
 The US Federal Reserve (Fed) has cut their rates to ZERO. Within hours of decision by Fed, the Hong Kong Monetary Authority also lowered its base rate by 65 basis points to 0.86% and this is the second reduction in March by both authorities.
(Our BNM also cut the rates twice this year already. Read the latest cut here)

MIDF Amanah Investment Bank Bhd senior analyst Imran Yassin Mohd Yusof said, “BNM would not follow the US and announce an emergency OPR cut as it will likely do so during an MPC meeting. We also have to bear in mind that they have cut the rate twice this year and our government was also quick to introduce a stimulus package. However, we do believe the central bank may take another easing stance during its May meeting.”

Imran Yassin expects BNM to slash another 25bps, bringing the OPR to 2.25% at the next MPC’s meeting.  In a report, Hong Leong Investment Bank said BNM will likely reduce the policy rate by a total of 50bps this year to bring the rate down to 2% in 2020. Please read the full article here:
Article in themalaysianreserve.com

With the implementation of the Movement Restriction from 18th – 31st March 2020, the economic growth is likely to be somewhat impacted (even if the panic buying before may pushed up the numbers a bit). With the COVID-19 continuing to wreck havoc all over the world, many central banks will have to do more in order to contain the economic fallout and monetary policies will come to the fore. Please stay home, everyone. Hopefully all these negatives will slowly disappear within the next 2 weeks or so.

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Taxes, governments, people and economic growth

Rumours never stop. Do they usually come true or turn out to be false? Anyway, without spark, there’s no fire. Of course, we do have fire extinguishers too which can take out the fire fast. This is the
Article in FreeMalaysiaToday: Investors brace for tax on capital gains, consumers
  It quoted Geoffrey Ng, a director of Fortress Capital Asset Management Sdn who said by phone.“Taxes will definitely be introduced especially on the rich and on consumption. He also said, Capital gains tax is “definitely a widespread worry among investors”, but it is unlikely as most markets in Southeast Asia do not have such taxes.” (MOST markets in ASEAN does not have it is indeed a very strong reason because if we lose the investors, they can still continue to invest into ASEAN through other countries)

That two potential taxes swirling in the market would be capital gains and consumption taxes. Our Finance Minister Lim Guan Eng will be revealing more in his 2019 budget speech. The article said that Malaysia is now seeking new sources of income since removing GST as well as the debt and liabilities exceeding RM1 trillion (US$241 billion), worsened by state guarantees on notes issued by troubled fund 1MDB. Beyond this, the economic growth is slowing down too. H2 2018 showed a 4.5 percent growth and this missed all economist estimates. (This meant no one expected such a low growth) Another talk was the inheritance tax but this may not be so soon and the government may only decided in the next few years if they are feasible, The Star reported, citing unnamed sources.
Please refer to the full article here.

Taxes are needed for all governments so that they can also have revenues to push for higher growth. Just remember that many governments were ‘changed’ because of tax issues too. Just google and you will know what I mean. Broad based taxes may be covering everyone but this allows the government of the day to then decide how to redistribute this to the needy if they are serious about caring for the people. Narrow based taxes are good because it will enable the government to be more focused and they have flexibility to introduce different taxes for different purposes. Readers of kopiandproperty.com would know that I favour GST but as a Malaysian, I support initiatives of the government of the day and continue to write good things about our country, everyday. 🙂

written on 18th Oct 2018

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Pound Sterling and US Dollar at parity?

When I was in Bristol, UK for my first degree, the Pound to Ringgit went up to RM8 to 1 Sterling Pound! Yes, that was in September / October of 1997. Well, those times have passed. These few weeks has been pretty bad for the Pound because of Brexit referendum. The UK public has made a decision to leave European Union. Well, majority wins even if it’s just 51% of all the votes with more than enough number which did not vote. In case we think this is already the worst, there is now a potential that US$ and Pound may reach parity. Yes, One to One.

Reported in Reuters. This is just a prediction by El-Erian, the chief economic adviser to Allianz which has around 1.3 trillion euros ($1.4 trillion). Wait a minute, TRILLION. Okay, better take his views slightly more seriously. He said, Britain must quickly come up with a credible and swift Plan B to EU membership that included a free trade agreement with the bloc. UK needs a new Prime Minister who would be able to negotiate effectively with the EU. Without a good outcome from the negotiation, Britain will face
greater structural uncertainty, lower economic growth and a higher risk of recession.
 A sobering thought indeed.

Current Prime Minister David Cameron has stated that he will step down and will not lead the negotiation for the exit. I think he has made a good choice. He did not want it in the first place. El-Erian added that “If, however, there is agreement between the UK and its European partners on a new arrangement that allows for sufficient free trade access, sterling could end up appreciating from its current levels.” I personally do not think EU leaders would want to make it impossible for any trade to happen between the EU and the UK. However, to provide too much flexibility and concession may also meant that some other members may contemplate doing the same. That fine balance is the real reason for
current volatility of the

currency. Happy following.

written on 8 July 2016

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Powerful sentence. 3 Asians and 1 European (countries lah)

I am against Brexit because I think the UK will gain more by staying within the European Union and not outside.
Earlier articles are many and here’s one.
Well, at least we have one more prediction which tells of the potential of the UK losing the 6th largest economy crown to France due to Brexit.
Here’s that article in standard.co.uk
 France is set to overtake the UK to become the world’s sixth biggest economy next year, according to a report. The Centre for Economics and Business Research (CEBR) warned that “disruption” caused by Brexit was inevitable due to lower inward and business investment.

Fortunately, France will not be able to hold on and the UK is expected to take back the 6th largest economy crown by 2020 and hold on to it until 2033. Meanwhile America will lose its world’s largest economy by 2032 to China. (That’s just 13 years away…) Now for that IMPORTANT few sentences. Deputy chairman Douglas McWilliams said: “The World Economic League Table shows that despite global uncertainty and the tightening in US monetary policy which has pushed down some of the emerging market currencies, the 21st century is still likely to be the Asian century. In 2003, the world’s five largest economies were the US, Japan and three European countries.
 Thirty years later, three out of the top five economies will be Asian and only one will be European.

Here’s that article in standard.co.uk

There are many reasons
why most liveable countries are usually the advanced economies and the most affordable ones are usually the emerging ones.
One is already a grown up and has everything which everyone likes to have. The other is still growing and thus many things are still being built today. Even when we look at the property market for example, we may see the property affordability is already at breaking point for many advanced property markets, unless the prices slow down to allow the income to catch up. Hopefully this happens smoothly or else, it will affect everyone else too. Happy understanding the dynamics of the world economy.

written on 28 Dec 2018

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Media Release:  PPB PROPERTIES INJECTS NEW LIFE TO BEDONG

PPB PROPERTIES INJECTS NEW LIFE TO BEDONG

Lumina Bedong expected to inject new life and elevate local community

BEDONG, 3 APRIL 2023
 – PPB Properties, the property division of PPB Group Berhad, has unveiled Lumina Bedong, Bedong’s first-ever township, which is set to revitalize the community, transforming it into a contemporary, lively township.

Built with the community at heart, Lumina Bedong will boast people-centric spaces, new living experiences and thriving commercial pockets, all set to improve and modernize the town.

The township, which sits on 228 acres of freehold land, comprises approximately 1,500 units of affordable landed homes strategically located amongst a host of amenities, as well as commercial components and recreational facilities.

When completed, the township will home a 5.6 acres central park, the largest recreational park within the vicinity, giving residents their first-time access to community-building amenities such as jogging and cycling tracks, reflexology path and children play area.

Lumina Bedong is set to appeal to newlyweds or young families looking for their first starter home. Not only that, it also hopes to draw in families in the surrounding area looking to upgrade to newer, more spacious homes within a well-planned, self-contained master township.

As part of Phase 1, PPB Properties will launch 221 units of 1.5-storey and 1-storey terrace houses. The focal point of these residential homes will be a 2.3-acre thematic park with a wide range of facilities, including a futsal court, jogging trail, outdoor gym and children play land, ideal for families.

The township will also comprise a commercial hub spanning 23 acres, making it the largest commercial development within the vicinity. This commercial hub will include retail experiences with diverse offerings suitable for working adults, families and children. In addition to providing convenience to residents, this space will generate new businesses, job opportunities for the community and drive a larger footfall into Bedong.

PPB Properties has built a sterling reputation for crafting high-value residential, retail and commercial space over the last 40 years. The company has established successful projects in Cheras, Kuala Lumpur, Petaling Jaya, Selangor, Penang and Johor. With the new launch of Lumina Bedong, the company is now gearing up to expand into the Northern region.

“With the development of Lumina Bedong, we are set to reinvigorate and transform the landscape of Bedong. We hope to drive the area’s socio-economic landscape through our residential, commercial and recreational components,” said
Low Eng Hooi, CEO of PPB Properties
.

“We are confident that Lumina Bedong will develop into a vibrant township in the coming future, making it a key locality in Kedah,”
Low
 said.

The township is well-connected to the city centre of Bandar Sungai Petani. It is situated strategically along the main road of Jalan Utama Alor Setar-Sg Petani, with various schools, retail shops and Bedong’s first Econsave only a stone’s throw away. Lumina Bedong has an estimated Gross Development Value (GDV) of RM900 million; the target completion is in 2035.

“Our mission as a seasoned, community-centric developer has always been about ensuring that we add value and improve the landscape of the local community. We hope to continue delivering well-crafted, quality developments,”
Low
said.

Other major developments under PPB Properties’ belt include Cheras LeisureMall, New World Park and Megah Rise in Petaling Jaya. PPB Properties is the property arm of PPB Group Berhad – a public-listed company with investments in Grains & Agribusinesses, Consumer Products and Film Exhibition and Distribution. Notable brands owned by the Group include Golden Screen Cinemas (GSC), Massimo bread, Seri Murni cooking oil and Cap Sauh flour.

— end of media release —

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PPR – RM120 / month, Huge arrears, Huge cars, Huge TVs.

It was reported in an online media that people are abusing the People’s Housing Programme (PPR) rental scheme. According to Penang state housing development committee chairman Jagdeep Singh Deo, more than half do not pay their rental and maintenance. Some even have 50 inch TVs! Many have Astro installed and I seriously do not think many of them are taking the cheapest package….  Well, for 16 years, the largest size I ever have for TV was 29 inch and I have just upgraded to 51 inch few months ago. Both my wife and I do not feel the need for a larger unit though we do like our new TV today. The rental for PPR units? Only RM120 / unit. This is a government programme for the poor and needy.

Be warned, the following is as usual as you can get. Would people change? Well, I was hoping but I guess not. Many years ago, my colleague told me that his neighbor drives a BMW but he has seen him eating bread for dinner many times before he drives his BMW out for entertainment. My colleague stays in medium cost flats. You may then wonder, how can his neighbor afford a BMW if he could not even buy a more expensive home? Well, that’s his choice and that medium cost flat might have been bought long time ago by his parents. So, perhaps we should just let it be?

What happens when huge number of people who really needs PPR flats but could not get one while those who have surpassed the actual requirements are still staying in those flats? Those who can afford Astro and luxurious cars but somehow still DO NOT pay maintenance or rental? It’s absurb for these things to happen and whether or not these people can vote, the state government should weed them out. If they truly qualify and that Astro was subsidized by their relatives and that luxurious car belongs to their friends, then surely they can get these friends and families to pay for the rental and maintenance?

If we are in Singapore, these things would not happen because the government knows you inside out and the Housing Development Board (HDB) is very strict and hey, if you book and cancel when you are offered an affordable unit, you will even be barred from applying again for one year! This part of Singapore’s efficiency with their housing matters, I think the authorities in Malaysia should take note and learn. I remember when I was young and immature many years ago, to ensure I listen my father would have his ‘rotan’ nearby and if my results were not up to his expectations, time for TV is cut without notice. Well, that helped to really discipline me, even if I did not like it. Truth is, when people refuse to abide by regulations, then force it upon them. Those who need should get it. Those who do not should not. Life’s like that, especially for housing which is a basic need.

written on 5 Nov 2014

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Why is Vaccination so powerful? Message from a country VERY MUCH vaccinated. (oh yeah… with lots of AZ…)

You know, it was easy to register for AZ during that first 280,000 doses. Reason? We still have lots of ‘clever’ Malaysians who think AZ ah…. dangerous lah… AZ ah…. let others take lah… AZ ah… many blood clot deaths… Never mind that they do not even read what’s the probability of that blood clot. Never mind that they have totally forgotten that UK people took AZ vaccinations very seriously. Now, we come to another milestone for UK. Yes, they are at a stage Malaysia hopes to be in a few months’ time. Please look at the
image below from bbc.com (click here to read full article)

From this news article in bbc.com

The UK has announced zero daily Covid deaths within 28 days of a positive test for the first time since March 2020.
  The
latest figures
 also reported another 3,165 new cases, compared with 3,383 on Monday and 2,493 one week ago. It comes amid concern over a recent small rise in cases linked to the variant first identified in India.  Full article here.
From this news article in bbc.com

What’s the percentage of UK people vaccinated? 75% of everyone who should receive has received first dose.
Article here.
 We just need to note that after vaccination, we could still be infected with Covid-19.  However, the chances are lower. The effects are also milder. Thus, if one is vaccinated and infected, going to the ICU may not be needed. To me, that’s a very good reason already to register and get vaccinated and stop asking what’s the vaccine brand.

What’s the antibody built up like for ONE DOSE of AstraZeneca or Pfizer in the UK? Rather amazing but NOT immediately after vaccinations yeah. It’s between 28-34 days after 1st dose.
Article here.

96%
 developed antibodies 28 to 34 days after receiving their first dose, according to research from University College London (UCL). The
research
, which is being prepared for peer review, found this figure to rise to 99% within seven and 14 days of their second shot for recipients of both vaccines, evidence that they provide protection against the coronavirus.
Full article in forbes.com here.

The story is simple.  Sign Up everyone you know.  Vaccinate enough people to reach 75% with one dose or higher. We can reach the stage where UK is. Would circumstances change in the UK?  What if there is a variant which is totally new and even more powerful than the current ones? Before we get to that question, how about ensuring we get vaccinated first against current ones?  We will cross the bridge when it comes. For now, GET ON THE BOAT!

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PR1MA: 10,000 units to be delivered in 2016?

These days, one of my personal wish is for more people to be able to afford a roof over their heads. One company that is receiving lots of attention for affordable homes would be PR1MA. I think I should highlight what PR1MA said to NST recently in an interview. We can revisit the things that as said at the beginning of next year and see how many of what was said came true. I also wish that 10,000 units to be completed within 2016 comes true.

Its chief executive officer (CEO) Datuk Abdul Mutalib Alias said that 883 units have been delivered over the past two years, and for 2016, the target is 10,000 units. There are 74,399 units under construction. 1.22 million potential buyers have registered. He also said that PR1MA would focus on industrialised building system (IBS), especially for landed property projects as it can deliver faster in between 12 to 14 months. The pace of delivery beginning 2017 will increase a lot; between 20,000 and 40,000 units per year.  He specifically said, “In our five-year plan of the 500,000 units (2020 target), we target to deliver 210,000 units by 2018. About 160,000 to 180,000 units will then be under construction, which means that we can start selling, while the balance of about 130,000 units will be under planning.”

It was also recently announced that PR1MA corp has been awarded eight prime locations along the light rail transits (LRT) lines in the Klang Valley for future projects. In essence, these would be transit-oriented developments (TOD) projects. Briefly, The Ampang, Kelana Jaya and Sri Petaling LRT lines have a total of 72 stations, of which 20 will be TOD projects. PR1MA’s sites are Pandan Indah, Pandan Jaya, Cempaka, Jelatek, Titiwangsa, Sentul, Bandar Puteri and Kinrara. The total land size for these areas are estimated at 12.9 ha and is sufficient for up to 2,500 units of affordable homes.

Let’s revisit that 10,000 units targeted by the beginning of 2017 yeah. For the sake of the potential 10,000 home owners and up to 40,000 residents, I wish PR1MA’s CEO all the best. Of course, this would also help tremendously in the GDP too through multiplier effects. New homes means new electrical equipments, new furnitures, renovation works and even house warming parties! For those who qualify, do register soonest for these units even if total registrations are still way above the estimated units to be built currently. Happy owning.

written on 6 Feb 2016

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PR1MA – 90,461 housing units for middle-income Malaysians – HOW?

PERBADANAN PR1MA Malaysia has to build 90,461 units for the middle-income Malaysians all over the country. According to PR1MA CEO Datuk Abdul Mutalib, by the end of 2014, close to
40,000
 units would have started or will start construction. Within Budget 2015, a total of 80,000 homes is to be built with an allocation of RM1.3 Billion. PR1MA are not the typical low cost flats we see last time. It comprises landed properties, high-rise apartments and mixed developments. I think this is the right way because none of the middle-income people I know told me that they love staying in low cost flats. In fact majority would like a condo if possible. Well, PR1MA may be a good consideration.

In order for a smooth delivery, PR1MA has to work closely with private developers, local authorities and partners to expedite the standard operating procedures and processes in the least time possible. Remember how some new technologies can enable a house to be built in months instead of years? Yes, it is also exploring the collaboration possibilities on Industrialised Housing Technology with potential partners from Japan, Australia, UK, US and China.

Where land matters are concerned, PR1MA may have to look at state governments as well because these lands can be sourced at a lower cost. The registration for specific PR1MA developments nationwide will soon be opened through newspapers and PR1MA website. Haha. I think it’s best that more are done online and not just PR1MA website and newspapers. Anyway, as a social service, will help to highlight if there are anything which can help the middle-income Malaysians to apply and get one.

PR1MA Requirements. Malaysian citizen aged 21 and above. Preference for residents already staying in the area where they apply. Applicants should not own more than one property in Malaysia. Individual or combined income of RM2,500 – RM10,000 to quality. Loans provided may be up to 110% from Maybank, MBSB and CIMB Bank and it includes funding for MRTA/MRTT, legal fees, stamp duties and other loan-related expenses. No deposit is required and all loan-related expenses will be covered. The loan tenure is for up to 35 years or up to age 70, whichever is earlier. Truth is, secondary market also have such units available but they may not be new units.

I look forward to the
40,000
 units that will start construction by end of 2014. Giving them a 3 year construction period, we are looking at more than 40,000 units by end of 2017. This does not include the potential for more units to be built faster using the industrialised technology. I may not qualify for one but I am very sure many would be waiting for one and should get one because a roof over one’s head is a pre-requisite to a healthy family. Majority of all arguments between husband and wife is about money. The biggest thing that money can buy is housing. Conclusion is easy to see. Another reason would be perhaps this may have the effect like what the HDB flat supply is doing to the market in Singapore. Lots of supply meant lower priced secondary market. I think this may be good for a longer and slower price growth for affordable properties instead of the past few years which was really unbelievable.

written on 18 Oct 2014

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PR1MA buys Glomac land for RM145.59 million (16.9 ha)

For developers, it’s not the best time to be holding lands and not doing anything. Current negative sentiment is persisting despite earlier predictions about a better H2 2015. Ringgit has gone up slightly but is still very volatile as the expectations of the decision from Federal Reserve overrides whatever story we may have over here. One listed developer is unlocking the value of its land and get some funds for future plans. Glomac Bhd will have a net gain of RM83.6 million after selling its 16.9 ha freehold land in Cheras to Perbadanan PR1MA Malaysia for RM145.59 million.

This piece of land was bought in 2004 and has a net book value of RM35.53 million. Of course, when they sell, it would be revalued based on current market prices and thus the current selling price. In fact, PR1MA had to offer a competitive price based on a willing buyer, willing seller basis. So now we know for sure that even PR1MA has to buy its lands and thus the prices being offered would definitely have to take this into account. In case, we are wondering why the prices they offer could not be much lower. The transaction would be completed on March 31, 2016. With this net gain, GMSB would provide it with future acquisition of more strategic landbank. It will be subject to the approval of the state authority.

The net gain of RM83.6 million is considered a huge gain and selling it is indeed a sound decision. If they were to develop it now, additional funds are needed and the total net profit is going to come 4 years later. Sound decision, really. Anyway, for those who love property stocks, this net gain would translate into 12 cents per share. It’s current share price? 89.5 cents. As for buying or not, it depends on also whether Glomac would have other developments. We should not be buying simply because of a one-time gain from selling of land. Do note that the proceeds would have to be ploughed back into buying landbanks in future. I do not own any Glomac stocks today. Happy investing.

written on 13 Oct 2015

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EPF withdrawal possible for PR1MA but…….

First of all, please buy within affordability. Getting a loan, whether from relatives or from a commercial institution is a huge commitment. Keep everything safe. That home sweet home can be one if you are happily staying. It will not be one if you have to work like crazy and struggle every month just to pay for it. For those who needs more assistance on end-financing, the Employees Provident Fund (EPF) has just confirmed that for members who meet the 1Malaysia People’s Housing Scheme’s (PR1MA) eligibility criteria, they can now apply for a new end-financing scheme. For the actual implementation date, EPF is still working with PR1MA, Bank Negara Malaysia and the participating banks to finalise the implementation details.

There is however a caution from EPF for members who chose this end-financing withdrawal. It said, “all other pre-retirement withdrawals under Account 2, namely medical, education, age 50 and haj withdrawals, will no longer be available until full settlement of the PR1MA loan has been made.” In other words, the property that EPF members chose to buy with their withdrawal should preferably be a good one; property prices rise faster than the typical EPF dividend rate. Else, the members would be losing on both ends. This is the reason why I would prefer my EPF to remain my EPF. For all other investments, I will try my best to work harder and save more money for them.

As for announcement by Prime Minister Datuk Seri Najib Tun Razak in announcing Budget 2017 in Parliament, he also shared the following which I consider good news for many people for having purchased a roof over their heads. Najib said, “PR1MA is well-received. More than 12,000 units worth RM3.3bil have been booked, while 85,000 units are at various stages of approval.” For members who are interested, do refer to PR1MA’s website at
http://www.pr1ma.my
 or PR1MA’s call centre at 03-7962 4374 for more information about this scheme. Happy calling and deciding.

written on 21 Oct 2016

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PR1MA Homes – Own one

Many have been saying that the property prices are no longer affordable. Actually, my view remain the same, I do not agree. This is because there are still choices but people only want to consider where they want to buy. If I want Cheras, I only want Cheras. I will not look at Kepong or Selayang or Rawang. I want Cheras, don’t you understand? That is however another matter. Today, we look at PR1MA which were posted in a lot of news site as well as facebook sites. Some announcements are expected very soon on who has obtained the units offered. Where are they? Well, there’s a map provided in The Star which gives an idea where all the PR1MA houses are located.

What are the requirements? Briefly:

Additional notes:

Additional state guidelines may apply.

Selection of successful homeowners and allocations of PR1MA home units will be carried out through an open balloting process.

A 10-year moratorium will be imposed, during which the property cannot be sold or transferred to another party.

PR1MA homes must be owner-occupied. No sub-letting will be allowed.

For those who qualifies and has NO properties, please do apply. For those who already own a home, please let others own a unit. These PRIMA units will also help to stabilise the price of properties in the market. Not so much on the high priced ones but for those in the lower to middle ones, the prices would be stabilised. Now, for the hard part, how would the enforcement of ‘no sub-letting’ will be done? I seriously hope that this can be done so that those who wanted to take advantage of this scheme will refrain from applying. There are a lot of people who needs these units.

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PR1MA in Penang starts 2018. 905 units from RM300,000. 257 units from RM72,500.

Do you know that your monthly repayment is RM1,352 if you buy a RM300,000 apartment with a 10 percent downpayment today? 30 years repayment period and 4.4 percent interest rate assumptions yeah. Assuming a healthy 30 percent of the income is used for mortgage payment, then the person or household would need to have a net income of RM4,500. Usually, can stretch to 40 percent lah, so even those earning a net income of RM3,400 also could qualify as long as he does not owe too much credit card debts or driving a new Segment B non-national car lah. Take a look at the image from iProperty.com’s mortgage calculator to understand more. If you are ready, then the chance is coming. PR1MA in Penang wi be starting within 2018 and there’s a total of 1,162 units for the benefit of over 1,000 families. Here’s one recent
news article about it in nst.com.my

State Local Government, Housing and Urban and Rural Planning Committee chairman Jagdeep Singh Deo said that Penang’s first 1Malaysia Peoples’ Home (PR1MA) project will begin construction by the end of this year. He also shared, “After discussions with the Housing and Local Government Minister, Zuraida Kamaruddin, she has agreed to allow us to monitor and supervise the project’s progress instead of the federal agency.” Briefly, there would be two blocks; a 38-storey block for the affordable housing category, with a 850 sq ft per unit to be sold at RM300,000 and another 31-storey block for the low-medium cost housing category, with a 650 sq ft per unit to be sold at RM72,500. In terms of numbers, a total of 905 units are for the affordable housing category and 257 units for the low-medium cost housing category. The developer is Ideal Property Development Sdn Bhd. The project will be completed in 3 years after the construction started. Please refer to the full
news article about it in nst.com.my

Whenever it comes to affordable housing projects, my usual worry is always the number of available car parks. The reason is simple. If there are insufficient number of car parks, then the owners would usually park their cars along the road side. This will cause the lane to become narrow and a jam can easily start. Perhaps it is good to ensure that the number of car parks would be sufficient to cater to the number of potential households. In fact, one more potential solution is for the development to also have bus transit services to the LRT since it has been revealed recently that the LRT project may be ready within 5 years. Do apply for it if you qualify because RM300,000 for a 850 sq ft is really quite attractive in 2021 when it’s completed. It’s just RM350 per sq ft yeah. Happy applying and enjoying your first home.

written on 21 June 2018

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PR1MA – No Bank Loan? No Worries. Rent for up to 30 years.

During a groundbreaking ceremony in Seremban, another new enhancement for PR1MA scheme was announced by Prime Minister Datuk Seri Najib Tun Razak. For the applicants to PR1MA who qualifies but were unable to secure a bank loan can now rent for up to 30 years. This Rent-to-Own (RTO) scheme would be for potential buyers who could not afford the units or were turned away by banks to still own these units by paying rents for up to 30 years and eventually owning the unit! In terms of implementation, some sort of arrangements would have to be coordinated with the banks concerned.

He said that this intervention is necessary because there were real cases of genuine buyers who just could not come up with proper documents to support their applications. As of last year, total PR1MA applications has reached over 700,000 in the national registration system and in terms of approval, up to 80,494 are approved for construction. This is indeed a huge number but as usual, there were no mention as to how many of these 700,000 applications have been vetted and how many actually qualifies or were rejected or are the potential ones for the latest RTO scheme.

Personally, if I am able to, I would love that everyone who needs a home should own a home. However, as in any schemes, the implementation part must be well thought of. Imagine if those who can actually qualify for loans trying to be funny and made their loans rejected just to qualify for this RTO scheme. Smile or laugh if you want but these things do happen. If more are offered these RTO schemes, then there would be lesser financial resources available for other qualified or more genuine first time buyers. Somehow, someone or some organisation has to pick up the tab for the construction of these units as RTO scheme meant that the occupant pays just rental. So, if the units costs RM200,000 to build, this money would have to come from somewhere because if the rental is RM500, then it will just be a payment of RM6,000 after one year!  Ok, will await more details on this latest piece of news.

written on 10th Sept 2014

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PR1MA projects frozen pending PWC due diligence report.

PR1MA is a good programme at its core; quality affordable homes for the people. However, simply building ever more homes under PR1MA programme is not going to help the situation because what’s built MUST be sold. Else, it adds up into the unsold stocks. As it is, the problem is already pretty huge. Earlier article here:
UNSOLD UNITS.
The money spent for the construction of these unwanted homes could have been used elsewhere so that more Malaysians could benefit from a roof over their heads. In fact it could have been used to construct homes for rent-to-own schemes for example. So,I support the move by the Housing and Local Government Minister Zuraida Kamaruddin who announced that PR1MA homes which have not commenced will be frozen.

Article in edgeprop.my here.
Zuraida said, “The PR1MA homes that have been completed will still go on sale and the ones currently under construction will still be completed. However, we are freezing the projects that have not commenced construction work as we assess their viability.”  She shared that some proposed projects of the 1Malaysia People’s Housing Programme (PR1MA) are being reviewed and the impractical ones may be cancelled. Furthermore, she added that currently PricewaterhouseCoopers (PwC) is carrying out due diligence and the decision on the projects shall be made once the firm completes its PR1MA report, which is around June 2019.
Article in edgeprop.my here.

Until today, I do not have any friends who told me about their PR1MA purchase. If there are any kopiandproperty.com readers have bought a unit, could you share the progress? As a concerned Malaysian for the B40 and M40 households without a home, I think centralisation of all the affordable home programme is a step in the right direction. In
PCON 2019 today,
 a speaker said that with proptech it is possible in the future for future buyers to indicate the kind of homes and the location before any construction starts. This will surely reduce the number of unsold units. As for whether we have OVERSUPPLY of units, the answer is NO.  We simply have a mismatch in demand versus supply. Another 100,000 affordable home units are coming by the way. Cheers.

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Article written and edited by Charles. News article summarised by Dina Batrisyia.

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First-time home buyers need PR1MA RTO to be successful

Heard of PR1MA RTO yet?

There are many reasons why first-time home buyers could not become first-time home owners. One super major reason is because they simply could NOT save enough downpayment for that 10% of the home price. If we look at a RM350,000 property, the typical downpayment alone would be RM35,000. This is not a small amount and usually would need lots of discipline from the first-time home buyer over a period of many years. Yeah, it’s really tough for someone who earns RM5,000 per month to save RM500 per month just for a home for 6 years continuously.

RM500 x 12 (months) x 5 years = RM30,000

There was the announcement that PR1MA’s rent-to-own (RTO) scheme will be launched in June 2021. It’s part of the solution under the Budget 2021 to help first-time home buyers become first-time home owners. June is only 2.5 months away. I personally think this is very important for the first-time home buyers and thus, the Housing and Local Government ministry MUST ensure this is successful. If this is not successful, it will be very hard to help all these potential first-time home buyers. Why do I say so? Do read the news first and my views would be right after.

Article in themalaysianreserve.com
.
  Housing and Local Government Minister (KPKT) Datuk Zuraida Kamaruddin said that the rent-to-own (RTO) housing scheme as announced under Budget 2021 involving PR1MA homes nationwide is expected to be launched this June. She said, “The RTO has yet to be implemented because we are waiting (for results of discussions) on the mechanism to be adopted.Once the scheme is finalised, we will offer the PR1MA houses that have been approved and we are trying to do this by June.”
Article in themalaysianreserve.com
.

A typical RM350,000 home would need 10% downpayment and the repayment per month using a 30-year repayment is as follows:

Anyone earning RM5,000 per month could definitely afford to pay 27% of their monthly salary on a home. In fact, even someone earning RM4,000 would still be able to afford this home if they are willing to do so. RM1,362 / RM4,000 = 34% of their monthly pay. They just could not afford the downpayment because they were not able to save it up remember?

What happens 5 years down the road for this RTO is that the renter (first-time home buyer)  would have paid enough of the “rental” for this rental to now become a downpayment. Without the need to be disciplined to save the downpayment over a period of 5 years, the RTO scheme has helped the first-time home buyer to save the downpayment over a period of 5 years. the banks would also have a record of this renter who and would be persuaded to approve the home loan easily too from the track record.

Hopefully, we get more details soon and I do hope first-time home buyers take this seriously because this may be the best chance to own a home.

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