No matter who the person is, if the person tells you that buying this property is sure success because it’s near the MRT, please think again. The reason is because if there’s such a thing, everyone would already know and everyone would have been faster than us. In other words, when we learnt about it and we wanted to buy, the price has already moved upwards.
I had a great conversation with someone who loves hold investment and could speak easily on the topic for hours. However, he kept saying that property investment is not good because… he bought a landed property somewhere in Klang Valley and it has not appreciated much for the past 5 years and yet the rental is very bad and could not cover the monthly mortgage payment.
If you are also waiting to buy a property just like me, then here are some homework that you would have to do first. I am also doing all these steps too. Else, I cannot say that I am waiting to buy a property. If I did not do the below, then I have to say I am dreaming about buying a property. In order to wait for the right property to buy, I need to do the following. Perhaps you can also take a look and follow the steps which are relevant to you?
A learned friend once told me that when everyone is buying property without thinking much, the property prices should be rising. Makes sense! Meanwhile if everyone starts to say bad things about the property market, then should the prices start dropping then? I ask myself as an owner. If someone were to badmouth about the property market and then come to me and ask me to sell my property at a lower price, what would I do? I will politely ask the person to go fly kite or in Hokkien, wait long long lah…
I like to ask everyone, when someone says luxury property, what’s the price point which we are talking about? RM800,000? RM900,000? RM1 million? Erm… I think these days, RM1 million property may just be sub-luxury. A typical double-storey terrace home in a properly planned township would already be close to RM1 million if not higher. The location is not even within any mature neighborhood. Else, it will be even higher than RM1 million.
Do you know that when home prices become totally unaffordable, the government of the day will feel the pressure because if people could afford a property, they will be happy but if they could not find anything which they could afford, then the tension will start to simmer. Not a great news for any government of the day. This is why the Singapore government is taking steps to ensure the warm to hot public housing transactions are cooled down before it gets too hot to handle.
My advice when it comes to buying a property is a simple one. Buy something you need and can afford comfortably. Else, it’s perfectly find to keep renting a property you feel comfortable with and you could afford the rental comfortably. It would be foolish to buy a property and struggle to pay the monthly mortgage but it would be super foolish to rent a home which we are struggling to pay the rental every month!
Sorry, the answer is not ONLY the home owner. In fact you will soon see why home owner does not necessarily enjoy more when they are compared to the tenant. As usual, these are my views as both a home owner and also a tenant since my college days all the way to my working days. In fact, I told my wife that maybe we could become a tenant again after we retire! Haha. Truth is, when we are 60 etc, there is really no need to stay at one place and that one place only. Just my thoughts. We could move a bit more.
My blog tells you very clearly I am passionate about property investment. However, I am very much against buying any property because someone famous or popular tells us too. Sorry, that’s very scary! How could we pay many hundreds of thousands for a property because of the words people say? Especially if these people may profit from us buying that property in the form of commissions from the property developer? So, what are some of the reasons to buy a property? Below are some of the reasons. If many of them matched what you need, then you may consider buying that property yeah.
Every time someone talks about new babies, we come to the topic of oh dear, the Chinese population here in Malaysia is dropping. Erm… of course we are but truth is, the live birth rate continues to drop for Malaysia as a nation. By the way, when the increase in population kept dropping of course the demand for goods and services in the future would be lower yeah.
Overpriced property is always in the market. Somehow some of these overpriced properties could still continue to rise in price because people just love to buy them. I say overpriced because the rental could NOT even cover the interest payment for the repayment yeah. I also do not personally think we should calculate yield based on constructing additional rooms. In other words, if we need to build additional rooms in order to get a positive yield, then this property is overpriced. Find the ones which you have compared, benchmarked and know that the price is okay.
When a developer buys a piece of land and their gross development value (GDV) is around 10 times of the land price, the price they want to sell will be adjusted based on the size, the number of units, the type of properties etc. The bigger units they build, the fewer units will be built and the more expensive the units would be. The smaller the unit size, then more units could be built and in fact the prices tend to be lower because the GDV is now divided by a larger number of units. Let me explain.