No need to ask if the founder of kopiandproperty.com loves property or not right. My blog is all about property. However, it’s not all good about property. Later I share 4 BAD points with you. I still love the stock market even if I have just become active again recently. I also trust the unit trusts too and has been buying it since … very long time ago. I also have one piece of RM600 Malaysian note. You have never ever seen such a note before? Image below:
So, now that you know that I do not just invest into one type of investment, let’s start about the 4 BAD things about property investment.
#1 – TIME It takes a LONG time to choose the right one. Seriously, how many of us can just see one property and immediately buy? It could be a few hundred thousand ringgit yeah. It takes a LONG time to complete the transaction. From the bank loans all the way to state consent for leasehold properties and even renovating it before moving in, it takes a lot of time.
#2 – ILLIQUID If it’s the stock market, then it’s sell today and the money is in within a few days. If it’s the unit trust, after you sell, the money could arrive by the very next day. In fact remember my RM600 bank note? I could sell and get money for it within the same day. Property is a different story. Selling a property may just take months and the whole transaction would take a few more months. By the time the money arrived, you may have forgotten why you need to sell in the first place.
#3 – High entry cost – Even if the property is just RM500,000 one would need to have at least 15% of RM500,000 for down payment, lawyers fee, stamp duty and some very minor renovations or furnishings. If you are staying, then at least it’s more worthwhile to buy. If this is for investment, then please do understand that price appreciation can only happen after many years. Meanwhile you can start investing in stocks and unit trust with just hundreds of ringgit. (Not lower than this lah, else why are you investing…)
#4 – Rejection is painful – Based on the usual lifestyle of many people, especially the non-stop vacations as well as new smartphones every year, the rejection ratio for this group of home loan applicants will be high. Most of the time, all these expenses as well as the credit card repayments would have destroyed our Debt Service Ratio (DSR) making it very tough to buy a property for investment.
If you think we must not read the bad side but also the good side, then you should click to follow kopiandproperty.com FB page. Plus read here for 10 reasons to invest into property or properties. For this article, I tell you just one. Your rental does NOT stop when you retire. Savvy? Assuming your rental is RM1,500 per month and you live till 80 and you retire at 60, this is the calculation.
20 years x 12 months x RM1,500 per month (we assume rental stays the same!) = RM360,000. Looks like the same price as buying an affordable property today, right? Think about it then. Decision is yours, not mine.
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