People say property is becoming expensive. People say money is becoming smaller. When we put these two into the same equation and we want to balance it, then it’s either property needs to adjust itself or money has to adjust itself. Unfortunately, salary is mostly fixed. So property has to adjust itself.
I have been asked this question many times. Maybe someone hope that if they ask me enough times, my answer to them may be a different one? Haha. “How sure am I that the home price will continue rising?” As usual, my answer is just look at all the more advanced countries than Malaysia. Stop thinking of Malaysia as a centre of the world for property. We are not. Not even close to that status. Most of our transactions are from Malaysians. As for answering the question about the potential for home prices to keep rising, let’s not write. Let’s just look at charts after charts. All are from tradingeconomics.com
For some housing areas, some residents may prefer to increase the security and thus perhaps a boom gate may be built and security guards would be hired to manage it. Yes, boom gates are allowed if the city council approves it. Meanwhile, it’s not easy to get every resident within the housing area to pay for the boom gates operation yeah. Now, perhaps it could get slightly easier? A court has just decided that if one does not pay, no one will help to open the boom gate yeah.
This was announced earlier but I think many may have missed the news because I do not read that many articles about firs time home buyers being super excited with it. Yes, this is definitely good news for many potential homebuyers. Not sure how many first time homebuyers were waiting for this extra savings when they buy their very first property. Please note that full exemption is only for properties priced RM500,000 and below only. This is valid until end of 2025.
Someone shared that investing into the stock market is easy. He showed many success stories. Someone shared that his crypto-currency is starting to show positive signs again. Someone shared that when it comes to the current situation, it’s best to rent because we could save more money versus buying a property. Renting may be RM2,000 but paying repayment for the same property could be 50 percent higher, or at least 20 or 30 percent higher. Everyone has their say because they may have achieved something positive and thus they are sharing what they know. I just like to ask three easy to answer questions.
From an article I read where the link is provided just below, it tells me that it is not just the working professionals who may face rental increase when the demand is higher than the supply of homes. Even the wealthier ones are also affected by rental increase. Yes, the wealthier ones also rent and does not necessarily own the place. 🙂 Imagine the person these wealthy ones are renting from. Below is a chart showing that Singapore has beaten New York in terms of luxury property rental growth.
A close friend who’s a senior manager in a US MNC asked me about purchasing a property as she wanted to advise her staff who’s looking at new properties and mentioned to her that the prices are beyond his budget. She said her staff showed her many property brochures and the prices and told her that all these properties are priced beyond his salary.
During the recent Chinese New Year, I visited my primary schoolmate. Yes, based on number of years, we have known one another for nothing less than 35 years. All these years, I have always known him as an expat working in United Arab Emirates (UAE) and he has worked in both Dubai and Abu Dhabi too. Many years ago, he also said that Dubai is an amazingly cosmopolitan city and that I should definitely visit him there.
If rental in KL city centre increased very quickly, people may rent at the fringes of KL city centre. If the whole KL city is very expensive, people will rent homes with a Selangor address. This is common and this is why prices always rise from the place with the most demand first. When the supply can no longer keep up, the supply would have to be expanded somehow. Else, the rental will increase until the market collapses. Either people stop coming to KL to work since rental is just too high or the owners start to reduce rental voluntarily. 🙂
If I have a home which I am not staying and yet I am paying, I would be desperately looking for a tenant to rent it from me. You see, every month that I could not rent it out, I would have to pay for it. If I could rent it out, even if I could not cover my monthly repayment, at least I do not have to bear the full repayment by myself. I am very sure there are homeowners who are in this situation.
My tenant called me one day and said, “Charles, I intend to move out in 2 months time. I have bought a new place.” For 4 years, the tenant (a Malaysian Indian engineer) was diligently paying his rental for my 730 sq ft apartment. He was driving a Proton Iswara though he is already a senior engineer in a multinational company. He was telling me that he will stop renting because he is buying a landed property from the secondary market. His new home is easily 2.5 times bigger than the apartment he is renting. Probably 2.5 times the price of the apartment he’s renting too.
A property is always the most expensive thing we would buy, unless of course we prefer to pay more for a car versus a house. I would prefer to pay more for a house than a car yeah. A property appreciates while a car depreciates as soon as drive it home from the showroom.