Many friends have remarked that it’s impossible to buy a landed property these days. I think I have to agree because they only want to buy at certain areas. So the advice for them? ‘Earn MORE.’ I still remember when my parents bought our Ipoh semi-detached home in the 90s, it was just RM85,000. Today that same property is RM540,000 or higher. My brother just bought a unit just two units away. My parents are still staying there and I would most probably be staying there in the future as well or my brother’s unit. Haha. I will pay them rental lah. However, when we really calculate over the period of years versus the actual price appreciation, the gain in percentage is really not that high. This is still Ipoh after all. Then again, when we retire and we have such a home and we sell it, the money is enough to last us for a very long time. RM540,000 / 12 months / 20 years = RM2,083 per month. Not too bad lah. Current situation? Malaysia: 42 percent senior citizens have zero savings
Now, imagine if my parents did not buy that property over 20 years ago. Imagine if they were to save and wait for the best opportunity to buy. There’s little possibility that they would ever own that home. Remember, inflation is our main enemy. A good property should allow us to hedge against it well. ‘Yesterday’ property purchased with the price then would enable you to be able to sell at today’s property price. Today’s property prices would also be much higher when you want to sell in the future. Looking at just a secondary city like Ipoh would already tell you what the potential would be in bigger cities like Penang or Kuala Lumpur or even the one right next to Singapore, Johor Bahru. The percentage growth in property price may be low and may even be slightly below inflation rate as what people say BUT that little percentage would be based on the TOTAL house price and soon enough you can see that the amount is significant by the time you have settled it.
‘Yesterday,’ not only is the demand for property much smaller than today but even the supply is small. Number of developers are fewer and the project size is also nowhere near today’s grand scale. Choices in terms of design, types etc are also not many. Clearly, there was little to look for. Today, even if the size is the same, the design may be totally different and the prices too. Number of developers and the total demand is now much higher. In fact, unless Malaysia stops growing economically, the demand would continue and the prices of properties can only continue going up after a few years of slowing down. No, I am not talking about investment as in buying more than one unit. I am talking only for everyone to have one unit they can call their own. In the future, this home may be a huge chunk of cash when you need it. Happy celebrating yesterday’s decisions today. Happy looking forward to future’s property price with your purchase today.
updated on 22 Dec 2016
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