Please do not think that property prices are way too high. It will stop us from doing anything and in the end, we may have nothing and need to continue renting. FYI, when property prices are way too high, the transactions would stop, there may be panic selling and the property market may just crash. Yes, I am serious. Understanding what is a property bubble is important. Here’s an easy to understand three signs that anyone of us can pay attention to. Spotting signs of a property bubble, 3 points (Updated) There’s no need to look too far back. Property market may have bubble building and even bursting. It happened in 2008 in the country whose currency is rising versus virtually every country in the world today. Perhaps it’s because they are the ONLY country which is doing well even with close to 5 percent unemployment rate, huge trade deficits and huge national debts. Or perhaps every country in the world are just not doing well, somehow. Assuming you are now awake and after searching some property listings site realised that there are still properties that you could afford. What’s next? Three things should happen next before you decide. I assume you already have enough downpayment.
Comparisons. Firstly, what’s the type of property that you NEED. It may not be an expensive landed or even a luxury condo. Perhaps it may be just a 730 sq ft apartment like me when I first started. Yes, I love my first apartment and until today I still have sweet memories with it since I stayed in it for 4 years. Secondly, what’s your first choice area? Once you have decided on that area, start looking at other similar areas as well. Answer the ‘WHY’ not the ‘Where.’ Lastly, once you have decided on the type and the area, compare different developments and decide which are the ones you would like to view. Set aside time for this because it is our future.
Viewings. Even within the same development, after viewing a few units, we may like only one unit. That’s why viewings are necessary. Decisions come only after we have viewed developments in a few areas, not just one development. In fact, we MUST write down all the positives and negatives from all the viewings because after over 10 viewings over a period of a few weekends, it will become impossible to remember all of them. Some tips on inspecting the secondary condos that we may be viewing? 12 tips on inspecting condos. Assuming you have done sufficient viewings, it is time to decide.
Buying. Once you have decided on that property that you like, buying is not just saying yes. Buying is the final dot. Before that final dot, it’s negotiating. Do you have your second and third choices? Of course, let’s be realistic. The market is not full of desperate sellers because it has never been easy for everyone to get a home loan. Approvals are so hard! Our offer should take into account the prices that other sellers are also offering. If it is too low, it’s time to move on. The seller will not call you back. One colleague is still trying after failing in three attempts. He asked for a 10 percent discount. Another colleague meanwhile bought a unit after the seller agreed to a RM10,000 discount which is around 3 percent lower than the initial price. Perhaps a good target is in-between these two numbers. This is a property, not a pasar malam yeah…
Wishing you success in your property investment journey. Starting sooner is definitely more advantageous than starting later. Happy comparing, viewing and buying.
written on 22 Dec 2016
Next suggested article: Buying a renovated unit, why not?