Nick, the co-founder of Property Talk& Lifestyle Malaysia commented about an article I posted in Facebook. Here’s that article: SKYROCKETing prices causing people to rent. Oh dear. He said, “House 🏠 is a necessity in life, you can’t live without it…you either own it or rent it.” (I love and agree with his comment). A FB friend then commented that it’s healthy whether it’s renting or owning a unit. Hopefully the market recover soon. Nick replied, “million dollar question, how soon is soon?” (Another great comment, seriously) We often hear people saying that I will do this very soon. Frankly, without setting a timeline, the soon will not be coming soon. Anyway, for today, let’s just answer three usual questions and remember, this is NOT necessarily applicable to everyone. It’s just me.
How soon is soon? This is about the property market. Some say the property market is so slow currently that every developer is desperate and the unsold units are at record high. Some even say that many owners are willing to sell at a much lower price. With all these backgrounds, is it a time to wait and is it a time to look for good deals? Or is this a bad time because the market is going to crash soon? Anyway, here are some usual signs before a property market crashes. Unsold units do not usually crash the market too. Only when we lose jobs that we will stop paying mortgages and then we will crash the market when we could no longer hold on to our property. (A video at the end for easy understanding).
How low is low enough? This is about property prices. We want to buy when the prices are low, lower or lowest? Well, no one in the world knows when will property prices hit rock-bottom. As for low and lower, this depends on our own assessment. If we found a place where then rental is now giving yields of 8 percent based on the property price, should we wait until the yield is 10 percent or higher before buying? If we love a certain area and we know the usual prices and suddenly we saw a property for 10 percent lower than the usual, should we buy or should we wait longer? In the auction market, someone may have the opportunity to buy at 10 percent lower but he chooses to wait for the next auction where prices will go down another 10 percent lower from the previous auction price. In the next auction, there are now more than 5 potential bidders because the price is just too attractive. He may have lost the opportunity.
How do we decide? I think this is a better question to ask. How do we know when is the best time to enter? Actually, we don’t. That’s why it may be better to put solutions to that question instead. We can decide what kind of property we prefer, decide on the areas we want to concentrate in and even by deciding the price that will be attractive enough to enter. When we have all these in place, we are now ready to grab opportunities as soon as they come along and it’s not about waiting for the best time anymore.
What happens then if all the things we decided did not happen and the market suddenly recovers and we lose all opportunities to buy or having to chase and quickly buy a property before it gets too high? This is how the market moves yeah. This is also why 20 percent of the people usually holds 80 percent of the wealth in the world. This is also why we hear the famous quote, “I should have…’ As for how to decide, that’s up to everyone. Keep reading, comparing and evaluating and soon, we will be knowledgeable about that certain area that we are looking at. Way better than any of the property speakers in some property shows even. Happy deciding yeah.
written on 27 Sep 2018
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