The first time I told my parents that I was buying my second property, their first remark was, ‘is there any problem with your current home?’ That was many years ago. Their understanding of a property is that of a home sweet home. Simple right. You save, you buy, you stay and if can, let your children stay in future. True? Can be true if the home happened to be in an expanding city like Penang, KL, JB. Not true if the home happened to be in a small secondary town or even in a village which you go home only once a year after you have started working. Thus, the question is, ‘Is one property enough today?’ According to a HSBC survey, it has found out that many employees in Malaysia see a second property as a very important investment to ensure they retire better.
I think their survey is true for only the minority of all home owners. The reason I say so is because majority of everyone does not yet own their first property. Thus, the survey would not cover them, yet. Yet, this survey shows something else too. Those who has bought their first property would most likely go for the second and these are the people who would retire much more comfortably later on compared to those without or even those with just one property. Think along the lines of one property bought at just RM500,000 today and rising to only RM1,000,000 25 years later. Yea, by then RM1,000,000 may be smaller in value than today but I still think it’s far better than someone without a RM1,000,000 extra property to their name. Agree?
Yes, some would now ask how sure am I about a RM500,000 property becoming a RM1,000,000 property in the future? Truth is, I have no idea. Do you? Some would even argue that if they save RM500,000 in FD today, it should easily become RM1,000,000 in future. Hey, this is also true! The only issue, do we already have RM500,000 today? If someone has already accumulated RM500,000 today and does not simply spend but simply invest in the usual unit trusts or even some blue chip counters, I think it should also easily hit RM1,000,000 in 25 years. My personal conclusion for myself, one property is certainly not enough today and for future. Happy investing.
written on 22 Feb 2015
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