Malaysia Money Matters

FundMyHome - Malaysia's new property crowd funding review

2018-11-09T21:53:00.000-08:00

Hot on the heels of the 2019 Budget speech, the EdgeProperty together with the Government, developers and 2 major Banks (Maybank and CIMB) announced a new scheme to "crowdfund" property purchases called FundMyHome

So let's break it down in point form:

It's not a traditional purchase transaction.
"Buyers" put down 20% of the property price.
For the next 5 years, they can stay in the property or rent it out - there are no details on any restrictions on renovations or major structural changes. You can renovate. There is nothing more to pay, no rent no interest.
80% of the remainder is funded by the 2 banks (hence, where is the 'crowd' in this so-called crowdfunding scheme?)
At the end of the 5 years, the buyer can either sell the unit or take up a normal mortgage to purchase the unit in the conventional sense
If he sells it and there has been an increase in value - he gets to keep 20% of the profit while 80% goes to the 'investor'.
If he sells it a lower price, the buyer bears the whole loss!

Example:

I want to buy a unit priced at RM500,000
I need to pay upfront RM100,000
Maybank & CIMB come up with the remaining RM400k to the seller (conveniently the developers who are close to the Edge, LOL ahem I'm too cynical)
Over the next 5 years, the 100k paid by me is considered as a 5% per annum return on investment for the 400k (it more or less works out to be similar to cost of funds for the banks)

Option 1 - After 5 years, I decide to sell the place. The market value is now RM600K, so there is a profit of RM100K, wah! Happy! But wait! The profit share I get is only RM20k (not forgetting the new 5% RPGT, so the tax is 1k, net is 19k). The investors get the lion share amounting to 80k. So in essence, I've paid out 100k to live in a place for 5 years (20k rent per annum) and get back some equity gain of 19k, so I've paid net 81k rental for 5 years for a unit.

Option 2 - After 5 years, I decide that I love the place so I want to buy it. Now the market value is 600k, that means to get a loan, I have to fork out another 60k as a 10% downpayment and obtain a RM540k loan now (from Maybank or CIMB because I'm sure you're locked in with them) for the next 25 to 30 years at an estimated monthly repayment of RM2800 ! So I'll be out of pocket for RM160k and my loan repayment is higher - whereas if at year 0, I used the 100k as a downpayment, my loan would be at 400k at a monthly repayment of RM2080.

Option 3 - I rent out the place, for a 500k unit, maybe I can get a rental of about RM1.2k per month if it is a decent enough condo. Over 5 years assuming full occupancy, I would have collected rental amounting to RM72k - that is still a net cash outflow of 28k because I've had to fork out 100k upfront for the right to rent this place out. As with the case in option 1, now I sell at 600k, I get 19k back only! Overall, I am at a loss of 9k after 5 years.

Honestly, I can't see any way where this is beneficial to the house buyer! It benefits the developers who are can sell off their units and to the banks who are funding this scheme.

The only upside I can see is that if you have a lot of cash but can't get loans either because you're retired or your income documents are insufficient, AND you want to create a multiple unit property portfolio quickly - say you have 300k, instead of buying 1 apartment at 300k to rent out, you can leverage this scheme to buy / control RM1.5 million worth of property.

So I guess if you can find units with a high rental return of 5% or 6% - you could possibly turn a profit just on the rental alone and with some upside on capital gain although it won't be much.

Ultimately, is this a good scheme? If it is meant to help lower income people to buy homes, the answer is NO. It helps the developers, the banks and people who want to expand their rental portfolios - and the risk is overly weighted on the individuals because they take the burden of looking for tenants and collecting rent and take all the risk on the capital loss while only getting 20% of the gain!

All I can say is tread carefully and only get into this scheme if you have enough cash to 'play' with this.

If you are short of money but need to buy a home to live in, this is NOT FOR YOU. You will get burned. I suggest that you rent a cheaper place, save your money up + use your EPF account 2 to gather 15% to buy a place the normal way (10% for downpayment, 3% for legal fees & stamp duty and 2% as a cash buffer for moving costs etc).

Ryan & Miho Petaling Jaya

2018-10-19T22:56:00.002-07:00

Oh dear, I had meant to write a review about this for quite some time but have been busy.

Also, I didn't have much time to see the property and the details - only the location which was already very attractive to me.

So from the info that I got from the chat with the agent Phillip, the location is next to Jaya One - very nice location because you in PJ but with easy access into Bangsar, Damansara Heights, Mont'Kiara and thus into KL Centre via Jln Parliament or Jln Tun Razak.

Jaya One has loads of amenities (although a little quiet for my taste, nonetheless middle & upper-middle class clientele) with office buildings - hence good rental opportunities; or if you are working there then this is an ideal property for you as it has a walkway connecting the condo to the commercial district.

Pricing is reasonable at about RM700k+ for PJ area, I reckon that's a good buy.

Believe it is leasehold but so is everything in that area, just about.

My only grouse would be the set-up of the parking block which is adjacent to the residential block and not under it - guess it saves the developer money by not building so high BUT it means that if your allocated car park is at the edge of the block, you have a long walk from your lot to the lift lobby.

So ... that could be a deal breaker if you're kind of lazy to walk, but if you don't mind - then this property is a decent choice given the location and amenities!

20 times return on investment in 1 week?! Scam? Real?!

2018-09-30T00:44:00.002-07:00

LOL my lame attempt at clickbait.

Yes, I recently made a purchase / investment and it went UP in value 20 TIMES within a few days!

What was it?

A copy of Batman: Damned issue #1.

Why?

It contained full frontal nudity of the Bat-peen. hehe

Seriously though (hehe), it is because American comics are actually strictly governed by a pretty archaic self-imposed code of conduct that was set sometime in the 1950s.

So while you could argue that the images in modern comics are highly sexualised, anatomically correct nudity is actually taboo and not depicted at all.

Hence, this particular issue did contain it - I felt that it was alright and had *some* bearing on the story in that he (Batman) was really at his lowest point and pondering what to do - so the nudity was symbolic of him about to start anew and/or being extremely vulnerable.

Anyway, I managed to get a copy at the normal price and within a couple of days, my old friend from school was telling me that the bidding had gone up to 3 times the selling price.

Then, just a few days later, DC Comics announced that they will not be reprinting #1 with censored images, leaving the original batch of 100k worldwide being the only ones. In the comics world, reprints are extremely common for popular stories - and this one in particular, the writing and the art is indeed superb - making it a trifecta of 1) good content 2) controversy and 3) rarity

Once that news broke, the bidding shot up to 20 times for a normal copy and 400 times for a signed copy by the artist.

All in the space of less than a month.

That is why art is actually a good investment and can give you really spectacular returns but it is obviously not sustainable if you are looking to feed yourself on this.

No, this is a fun side hobby for those who either have the money to buy expensive art or passionate collectors (like me) who know the market and occasionally hit upon some good luck.

Anyway, I'm not selling it - going to keep it for the fun of it. But who knows, decades down the line, this would probably be still worth some decent amount of money hahaha

Changing careers

2018-09-26T06:57:00.000-07:00

I am thinking of going into real estate - first as an agent and then to work my way to either owning my own agency or being attached to a large firm at a senior level.

There are many reasons - mainly to do with time flexibility (I know I still have to hustle but at least one is not tied to office hours) and the potential to make a lot of money from big deals.

To be honest, working in banking has been very rewarding financially, not to mention the complexity of the work is intellectually stimulating.

But I'm getting tired of it and feel that I would rather take my destiny into my own hands instead of waiting for a yearly bonus and increment.

So let's see how things go - I'm going to a preview on the BOVAEA diploma certification to become an agent this weekend to get more information.

Properties on my radar

2018-08-24T21:39:00.000-07:00

Haven't been blogging - rather busy nowadays and so on. It's appraisal, bonus and increment season now, so have been preoccupied with that, along with goal setting and what not.

Anyway, I have been shopping around casually for properties but haven't found anything that I like enough to buy.

Thinking of getting a cheap property at below 200k for rental - maybe a commercial one that can rent out easily.

Areas that have reasonably priced units - to my mind - are Kepong and Cheras Business Centre which are busy enough but not overly expensive. I supposed Kuchai Business Park is also one but haven't looked deeply into that.

Let's see how things go...

Malaysia GE14 unprecedented change

2018-05-10T03:46:00.000-07:00

The Opposition took power.

This has never happened before and many people are elated on social media.

Not sure how the feeling is amongst the rural and small town folk though.

Overall, I am glad at the fact that we DID make a peaceful change without war or revolution (think it's not in our DNA, Malaysians are a pampered bunch really) but at the same time, I am very apprehensive about having people like Mahathir and Anwar back in the saddle... very worried indeed.

The Ringgit has dropped to 4.05 based on NFD as local markets are closed today.

The KLCI has lost something like 3% on after hour trading.

Is this a knee jerk reaction to the uncertainty? Hopefully so and we will see recovery based on fundamentals.

I think there will be at least a momentary uptick in consumer confidence and consumption will pick up just before the fasting month starts.

Still uncertain on longer term purchases like housing and cars.

20% return on total capital, 100% return on ventured capital

2018-05-10T03:43:00.001-07:00

Results so far, although it's been a wild ride.

Using margin account - my current paper profit is 8k on a 40k capital base but I only used 8k of capital for the margin, hence the "100%" return.

Sounds wonderful but it is really not easy to do so.

My early steps into share trading

2017-09-22T03:35:00.000-07:00

I've rarely dabbled in stocks - mainly the ones I buy are for dividend yields and they are basically REITs which give a return of 6% per annum

After reading the "One Minute Millionaire" mentioned in my previous post, I ventured into trying out the strategy in the book.

And I went and made a mistake some more! Haiyo! hahahaha

Anyway, maybe it is beginners' luck but based on the formula given - the stock I selected did make a 25% profit.

However, it took about a month for the price to float up to the expected level.

Overall, not too bad and I only invested a small sum.

So I will continue on in this and get more experience. Then can grow wealth more aggressively through this channel.

"The 10 Minute Millionaire" by D.R. Barton Jr. - book review

2017-06-11T05:34:00.001-07:00

I came across this book and bought it to read.

I am a total newbie when it comes to the stock markets and have been burnt by mutual funds before. I must admit that I'm good at saving money and have had some luck in properties but that's all.

So this book promises a way to make money from the stock markets.

NO, I will not reveal any spoilers here, you should buy it yourself if you want to know. I don't earn any commission or anything - this is just a review.

Anyway, it's a long read .. relatively light and one can get through it quite quickly if you are a fast reader.

He does love to talk about baseball and American history, especially the revolution. Very "down home" type of all-American style in his way of writing. I found these parts a bit dreary but then again, he IS writing mainly for his own market, so it can't really hold the attention of international readers.

Anyway, after ploughing through all that, it boils down to his recommended system of trading which is a fairly strict but simple formula. You will need to be disciplined and consistent in following it. It is not a get-rich-quick scheme nor is it a very long-term type of strategy.

I have no idea what experienced stock traders would think about his system. They do seem to be an opinionated lot though! hahahaha I'm staying well clear of them...

I haven't made any trades yet using this as I only just finished reading it last week LOL!

Anyway, I'm going to give it a go with a small amount next week when the markets start again. Wish me luck!

MM Residency in Taman Melawati (chinese edition)

2017-06-11T00:36:00.002-07:00

在Taman Melawati的旧世纪天堂乡村俱乐部（最近被称为KK俱乐部）的网站上的一个新发展。

我今天早晨开车过的时候注意到了。

我没有在这个地区一段时间 - 所以自然地，我检查了他们的网站。

这种发展的设计和概念是相当有趣的 - 它们的尺寸范围从450平方英尺到2,000平方英尺 - 10种不同的布局。

我对布局设计感兴趣的是有双工选项/迭代 - 即450平方英尺的工作室是基本单元，那么你将有一个双工设计，遵循工作室布局，但是加倍。

这是我的个人偏见，我喜欢双工，因为它给你的感觉就像你住在一所房子里。

平面图显示，客厅天花板的双层高度将翻倍;从而在马来西亚标准的1层公寓单位中创造出一种非常宽敞的感觉。

价格从RM684每平方英尺开始 - 这不便宜。

位置方面 - 我认为只有居住在这里的人才会对此感到欣慰，我认为这将吸引长时间的梅拉华蒂，王萨玛尤和安邦居民的居民。

这是一个很好的，安静的位置。我相信这将对你自己的住宿有好处。

我不认为可以获得高租金回报，也不会获得大量资本收益。像我说的，如果你喜欢邻里，想要自己的住宿，如果你是一个空的家庭，想要升级或缩小到可管理的东西。

总的来说，我喜欢这个发展，正在认真考虑买入。

在马来西亚采用儿童 - Adopting in Malaysia

2017-06-11T00:20:00.001-07:00

现在我一直在追求一个孩子的想法。然而，这可能只是一个管道梦想，因为鉴于一个人单独抚养一个孩子的现实不是能够处理能量和时间的事情。在财务上，我想我可以，但这只是冰山一角。

所以这就是一个朋友的朋友正在生孩子，单身也是。真的，他没有办法这样做。没有经济上的稳定，在这里没有家人的支持（他们住在东马来西亚，离开了一个航班），呃没有成熟，我想。虽然说是说可能还有一个孩子会强迫他一起去做他的行为。

无论如何，由于这个博客都是关于钱，我以为我会根据实际成本分解收养问题，并坚持到你的头发，我要说的是不是很愉快：

首先 - 有两种方式在这里采用：一种是通过福利部门，另一种是找到自己的宝贝。

福利部的方式是政府资助的方式，将部门将无孩子的夫妇与单身母亲或不得不放弃子女的贫困家庭联系起来。有一个漫长的等候名单，他们优先考虑已婚夫妇，虽然法律和程序确实允许单亲家长采用。父母必须经过筛选才能适应。全体董事会并按有关各方的最佳利益完成。唯一的问题是需要很长时间。排队很长，有更多的收养父母想要一个孩子，而不是有人愿意通过政府渠道放弃他们的孩子（也许害羞，保存脸等 - 我不会在这里投掷婴儿的问题！）。

另一种方式也是合法的，但是你知道这是怎样的，一旦涉及金钱，那么所有这些都开始看起来像一个商业的婴儿购买球拍。不是一个很好的感觉，任何你切片它。所以这是怎么回事？
作为收养父母，您可以与孩子的父母（无论是未出生还是已经出生）达成私人协议，让孩子自己去做。父母必须同意，双方同意，双方当事人通过判决允许或不允许的情况下，通常情况下（6个月培育非穆斯林，并在正式领养下为穆斯林培养2年）由穆斯林父母承担的只能由其他穆斯林采用，不会繁重，有人会说）。

现在这里是粘在哪里，生物的父母通常会得到回报。它可以是一个令人信服的总和，医疗费用，有时甚至没有什么只能让他们放弃孩子，继续前进（通常是父母不想要孩子的爸爸，爸爸不要传道？）。由于福利部门的进度缓慢（我不是错误的，他们应该小心他们放在哪里，不应该这样做），私人采用“工业”的规模要大得多。并且已经有一个价格设置，看起来不太好：

范围是 - 华裔男婴（新生儿或尽可能年轻），您必须至少支付RM20,000。

这是几年前，如果涨到3万令吉，我不会感到惊讶。

在频谱的另一端，印度的女婴 - 父母会给他们的孩子RM800。

是的，先生，两者之间有25倍的乘数。二十五。基尼系数怎么样？

我听说马来人的宝宝在中间的地方，没有必要用现金付钱，他们可以拿家常菜和家具（马来西亚的前同事，结婚10年，没有孩子，等待着）永远是福利，但没有回复，决定从沙捞越的一个村民得到一个孩子，她说她没有多付现金，家里那么穷，他们想要一些冰箱，炉子等基本的东西。）

这是一个坏的情况。很坏。我们的社会如何两极化和贫民窟化，一方面，一个印度女孩可以“卖”这么少，而一个华裔男孩是非常重视的？

这是贫富差距的一个症状。

Residensi Setiawangsa Kaleidescope - chinese edition

2017-06-11T00:13:00.001-07:00

即将在吉隆坡和雪兰莪边境启动一个项目！

土方工程已经持续了一段时间，展示厅可以看到几乎完成了，所以现在这个工程的名称和这个项目的名称一起要求登记。

可用的信息是开发商是Kerjaya Prospek集团 - 他们迄今已经完成了几个项目：222 Residency，288 Residency，The Shore和Veridian Cheras Idaman。

根据这个新项目的位置，我认为有更多的优点，而不是，所以我觉得很好。

风水智慧，位置很好：它背后有一座山（武吉丁），表示强大的支持，巴生河就在前面（而不是前面）。所以在前面的支持和资源的流动下，它的位置非常好。

土地的形状不是100％的理想，不是一个正方形或一个矩形。然而，这种梯形形状是幸运的，因为前面比后面宽，因此能够“接受”更多的智力。如果它被扭转了，那就是坏的。

位置的其他优点：

安静的位置，所有住宅区周围

围绕它的宽阔的道路

轻松访问DUKE，MRR2，AKLEH，如果政府将Jln 1/56连接到Jln AU5，它将连接到新的SUKE高速公路

Jln 1/56直接与DUKE相连，高速公路的入口/出口是距离3308出口不到1公里的回旋处

2-3公里半径内的设施：

锦绣国际学校

新的体育部综合体育馆与奥运大型泳池，赛马场等（以最低收费向公众开放）

2永旺永旺（Setiawangsa＆Wangsa Maju旧家具），有冷藏的王莎步行商场

上述购物中心有2座电影院。银行，商店等。

这个位置的缺点：

远离公共交通工具距离Sri Rampai或Setiawangsa轻轨站相当遥远

有一条巴士路线，但我没有看到任何附近的公车站，不知道LRT班车是否来了
。
有一些非法而又成熟的摊位正在迂回交通枢纽的低价单位服务，导致早晚壅塞！非常讨厌，真的，但是一个人必须深吸一口气，并学会与之相处。
安静和住宅也意味着你必须赶走任何东西 - 步行距离内没有商店或餐馆 - 除了上述的非法摊位！大声笑

所以让我们等待更多关于定价，项目设计，设计和融资方案的细节。

基于位置的初步评估是，这将是一个自己留住的地方，我不能想象这是租客很受欢迎，虽然你可以*仍然可以租出来。

我猜想会吸引年轻夫妇或家庭，他们是在AU / Keramat / Setiawangsa / Wangsa Maju地区长大的第二，三代人。

对我来说，从一个安静，幽静和绿色的地方来看，吸引力很大 - 新鲜空气和YET，连接高速公路，靠近KLCC。它也在吉隆坡境内，虽然你需要做的只是WALK在路上，你在雪兰莪哈哈哈

我很高兴看到展示厅做得好看的时候

Valuation Department Property Seminar

2017-05-01T04:38:00.001-07:00

I attended this seminar held by the Valuation Department and some interesting data was presented as well as points debated.

In a nutshell, there is still a large amount of new properties being planned, approved and constructed.

In fact, the housing stock will increase significantly.

Developers are realising that the kind of pricing that they have been charging is unsustainable and banks are increasing reluctant to fund such prices.

What was not discussed with income levels, however - because that is the key to housing affordability.

However, I guess it depends on one's philosophy on the economy. On one hand, the government should 'help' (which it does but there are obvious constraints) and on the other, in a free market / capitalist economy as ours, we really have to rely on ourselves i.e. to work and save the money for the house deposit and have the proper paperwork to support your loan application OR make enough money to buy it in cash!

Anyway, the upshot is - given the increasing supply of housing units coming into the market, the prices are likely to plateau and while there will still be growth in value, we most likely won't be seeing such dramatic growth in asset prices anymore.

Put simply: housing supply is going up, liquidity is low both from financing and from quantitative easing ebbing away - hence, prices will grow much more slowly. They won't tank, the signs are not there but they won't grow aggressively.

In fact, high end locations like Damansara Heights and Bangsar are seeing the asking prices levelling and falling on a per square foot basis.

So what's next? Time will tell...

1st post of 2017 and it's March!

2017-03-03T21:50:00.001-08:00

It's been 2 months since my last post.

Honestly, I did have some activity around properties but I didn't feel like writing about it. Can't even remember the name of that project now.. anyway, it is in Wangsa Maju and it is a decent deal but meh... somehow it got me excited then the sales tactics quickly left me COLD. So I didn't bother.

ANYWAY.. so what's new is that I'm in a relationship now, in love and feeling happy. Wonder if that has anything to do with me not posting anything lately, LOL!!

So on the money front - updates thus far:

Bonus - quite decent, about the same as last year - think it is slightly up by a few thousand. All in all, am very grateful for it.
Increment - I had a bad initial reaction to it, and I admit it was unjustifiable on my part because the increment was generous, except that the bulk of it came from the car allowance and not basic. It seems petty, I suppose - why not just make it as basic? Ah well, they still pay EPF on the allowance (and I have to pay tax on it too) so it's essentially the same as basic. Just the name only lor ... although, technically, employers *can* take away an allowance if need be... so that's the risk there that I was reacting to, I guess.
EPF dividend - just announced at 5.7%, to me, that's ok. I'm sure there are lots of people who won't be happy with that but then again, they are generally unhappy anyway, so no difference hahaha some funds can have stellar payouts like 20% but for a sovereign pension fund like the EPF, it can't take that much risk like a smaller fund, so there's that..

I'll stop here for now.

Investment property

2016-12-29T04:30:00.001-08:00

I have decided to look for properties that I can afford to buy in cash... don't want the hassle of taking loans.

However, to be on the safe side in terms of the transfer and so on, it is actually better to take a loan because of the due diligence done by the bank.

They will make sure the transfer is effected properly before they release the loan; cash buyers need to be very sure on the procedure in case they get duped.

Anyway, just my thoughts on the matter...

Some thoughts on Malaysian ringgit

2016-12-02T22:56:00.001-08:00

I'm definitely no expert on foreign exchange.

Was just thinking while walking back from lunch, as one does, that the degree of volatility doesn't seem to make sense. More so if people take the exchange rate as a proxy for your economy - while it does have bearing if the rate is long term and sustained, the sudden drop in currencies like MYR and Brazilian real doesn't jive with the economic fundamentals.

For example; we are still growing... our GDP growth is still positive compared to lots of other countries. We are still exporting a lot of goods despite the lower demand - after all, people around the world still need vegetable oil, petroleum and so on.

The problem is that if the speculators can sustain their attacks and the western media keeps repeating the same "bad news" / bad spin, then it becomes a self-fulfilling prophecy.

Sigh ... what can one do? I think to help the country, we must spend internally - to keep the momentum going.

Of course, one should spend wisely but we must not stop spending altogether.

我绝对不是外汇专家。

我只是认为林吉特的波动程度似乎没有任何意义。

更重要的是，如果人们以汇率代表您的经济 - 如果汇率是长期和持续的，货币汇率确实有影响力，像马来西亚和马里兰那样的货币突然下降不会与经济基本面相吻合。

例如;我们还在增长。与其他许多国家相比，马来西亚的国内生产总值增长仍然是正的

尽管需求下降，我们仍然出口大量商品，毕竟世界各地的人们仍然需要植物油，石油等。

问题是，如果投机者能够维持他们的攻击，西方媒体不断重复同样的“坏消息”/坏旋转，那么它就成为一个自我实现的预言。

叹息...可以做什么？我想帮助国家，我们必须在内部度过，以保持势头。

当然，应该明智地花钱，但我们决不能停止支出。

Should developers become financiers?

2016-09-11T09:09:00.002-07:00

It was announced that property developers can apply for the licensed money lender permit that will allow them to provide loans to their buyers by the Minister for Urban Development.

The rate is supposedly capped at 12%.

About a couple of days after that, the 2nd Finance Minister came out to say that the idea is not feasible as there are many risks and costs to all parties concerned.

Today, it was reported that this matter was not even discussed in Cabinet yet, so why did Noh Omar announce the money lending permit in the 1st place?

So let's break it down a little bit:

Technically, there is nothing wrong with a developer applying for a money lender license. It's just whether they want to or not.

The government is implementing the Rent to Own concept.

The 2 ministers are cornering the developers by first offering them the poison chalice of the lending licence then taking it away.

The developers are now put in the position of:

If they take the lending license, they are competing with the banks. The banks may not take kindly to their customers for bridging and end financing taking away the end financing part - hence, the bridging financing can suddenly turn very difficult to get, thus squeezing the developers' business
If they don't take the license, then public perception can turn against them because to desperate buyers, this could be their last resort to purchasing a new home in spite of their inability to qualify at the bank or their bad credit record. Then it will a PR nightmare for the developers.

So how to get out of this quandary?

Ha ... offer the Rent to Own option to the buyers, much like what SDB is doing!

Why this is generally a better option but kind of screws the developer?

The buyer is sort of paying the 10% down payment in instalments in the form of rent
The developer gets to register a sale and make some income, albeit delayed
The banks can hopefully use the rental payment record as a proxy for loan repayment behaviour then grant the 90% loan after some years based on proven record.
Reducing risky 100% loans in the country
Forcing some discipline onto errant credit record holders if they really want to stay in that unit
Developer now has to become a landlord and will be held accountable for damages, bad construction and must make fixes as demanded by the tenant/buyer instead of washing their hands after the 30 day make-good period

Anyway, this is all guesswork on my part but after observing the politics in this country for a while, as we know - nothing is ever quite what it seems.

Things are now happening on a more obtuse and strategic way, generally with the rakyat's interest at heart - I say this because I deal with some GLCs and they have been very clear that the direction from the top is that all initiatives MUST benefit the rakyat.

So that's my take on it ... we'll see how it goes. I could be wrong, who knows?

Becoming a slum lord?

2016-07-29T18:17:00.001-07:00

I found a small commercial unit with an asking price of below 100k.

Possibly something to buy in cash, no hassle with loans.

However, it is in a fairly low cost area so capital appreciation might be a challenge?

But the returns are decent at 7% based on the current rental being paid by the tenant against the asking price of the property. Of course if the rental was raised and the price is bargained down, the return increases.

Going to view the place soon, hope it is a good deal.

Lexa Residence

2016-07-29T18:14:00.000-07:00

The location for this development by the Beverly Group seems kind of good, at the main crossroads of Jln Setiawangsa, Jln 34/26 and Jln Mohd Yatim Yahaya.

It is diagonally across Riana Green East and opposite Infinity 3.

Freehold. Yeah!

There was a soft launch and the showhouse looks like it's almost ready.

Would be something I'm interested in as an investment.

It is fairly low density at 428 units.
Close enough to walk to the Sri Rampai LRT station - although if the developer is smart, they should offer a shuttle service to the station during rush hour, or be innovative - hire some mat rempits to make some extra cash in the morning ferrying people to the station LOL
The crossroad is being upgraded and expanded right now to alleviate the heavy traffic jam at the traffic lights, so should be better flow in future (haha who am I kidding, it will only be smooth for a while before more and more people move into Seasons Garden, Irama, Infinity and the new block at Riana thus causing the jam.. AGAIN)

Anyway, probably good for rental and possibly a downsize option for me when I'm older and don't need so much space.

Ah well.. waiting for the launch of the showroom. Should be nice!

Residensi Setiawangsa Kaleidoscope - updated

2016-06-17T20:29:00.000-07:00

Upcoming launch of a project at the border of KL and Selangor! LOL

The earthworks have been ongoing for a while and the show house can be seen to be nearly completed, that's why the siding now has the name of the project along with the number to call for registration.

The information available is that the developer is Kerjaya Prospek Group - they have completed a few projects so far: 222 Residency, 288 Residency, The Shore and Veridian Cheras Idaman.

Based on the location of this new project, I think there are more pros than cons - so, tl:dr version is I think it's good.

Let's break it down:
Location - the corner of Jalan 6/27A and Jalan 1/56, it is currently in a very quiet and green part of Setiawangsa. Here are the maps:

As you can see from the Earth version of the map, the trapezoid is the earthworks for Setiawangsa Residency.

Fengshui-wise, the position is good: It has a mountain behind (Bukit Dinding) signifying strong support and the Klang River is in front of it (well, not literally in front). So it sits very well with support from the back and resources flowing in front.

The shape of the land is not 100% ideal, not being a square or a rectangle. However, this trapezoid shape is fortunate because the front is wider than the back, hence able to 'receive' more Chi energy. If it was reversed, then that's bad.

Other advantages of the location:

Quiet location, all residential around the area
Wide roads surrounding it
Easy access to the DUKE, MRR2, AKLEH and if they ever connect Jln 1/56 to Jln AU5 (and widen that road!), it will even be linked to the SUKE if that project takes off
Jln 1/56 is directly linked to the DUKE, the entrance/exit of the highway is a roundabout which is less than 1km from exit 3308 (so auspicious liao the numberrr! LOL)
Amenities within a 2-3km radius:

Fairview International school
the new Ministry of Sports complex with Olympic sized pool, race track and others (open to the public at minimal fees)
2 AEONs (Setiawangsa & Wangsa Maju the old Carrefoure), Wangsa Walk Mall that has Cold Storage
2 cinemas in the aforementioned malls. banks, shops and so on.

The disadvantages of this location:

Far from public transport; a considerable distance to both Sri Rampai or Setiawangsa LRT
There is a bus route but I didn't see any nearby bus stops, am not sure if the LRT shuttle comes by .. because where this project is located, there are literally no houses immediately next to it.
There are some illegal but well established stalls serving the low cost flats just off the roundabout which causes congestion morning and evening! Very annoying, really but one must take a deep breath and learn to live with it.
Quiet and residential also means you have to drive out for anything - no shops or restaurants within walking distance - well, except for aforementioned illegal stalls! LOL

So let's wait for more details on the pricing, amenities within the project, design and financing packages.

Initial assessment based on location is that it will be an own-stay kind of place, I can't imagine this being very popular with renters although you *can* still rent it out for sure.

I would guess it will appeal to young couples or families who are the 2nd or 3rd generation of people who grew up in the AU/Keramat/Setiawangsa/Wangsa Maju area.

To me, it is appealing from the aspect that it is in a quiet, secluded and green area - lots of fresh air and YET, still so connected by highways and close to KLCC. It is also within KL boundaries, although all you need to do is WALK across the road and you're in Selangor hahaha

I'm excited to see when the show house is done to have a good look :)

UPDATED:
Price from rm575k onward, size 1,196sf to 1,491sf.
Partially furnished.
Booking fee rm5k only.

Total Units/Lots

600

Title type

Leasehold

Bedrooms

Bathroom

Typical mistakes young people make with money - Cars

2016-04-30T02:26:00.000-07:00

I was talking with a young acquaintance - friend of a friend - who was thinking of changing his car.

Now, to be fair, this young man had recently recovered from a year of medical treatment for his cancer and he's now back in good health.

So naturally, he's probably thinking of "rewarding" himself by getting a spanking new car that's way above his budget!

Honestly, I DO understand very much how he would feel, wanting to get a powerful new car is a great feeling for most guys! Right right?

But I probed a bit more and the financials doesn't make sense. He hasn't had any increase in salary but he is employed in a stable, semi-government organisation that is profit-generating, so no worries there vis-a-vis job security. In fact, his employer covered all his medical bills which is great for him.

So after some brainwashing hehe he did settle on booking a smaller car while he thinks a bit more about it.

My advice to him was to think strategically. Don't go rushing into buying your dream car now. Plan for it a few years down the road - buy a decent, cheaper car now that has good resale value and when the time comes, he would have enough equity in that to do a trade-in for a more expensive car but reduce the loan amount.

So instead of the car right now, plan for car 1, 2 and 3 - after all, by the time car 3 comes along, his career may have blossomed and he could very well go for something that he never even considered to be attainable!

That being said, we (as in my friend and I) encouraged him to think about buying a starter property first instead of changing his car which is fully paid down anyway. He's renting right now and for an extra few hundred on top of his current rent, he could be owning something outright.

Food for thought...

Developer road shows - some big discounts / rebates being given

2016-04-30T00:36:00.000-07:00

Was at a mall just this morning and there were a few developers promoting some of their projects.

Interesting thing is, this time around, they are trying to push through the remaining handful of units that they have left - usually 20 or 30 units still unsold and the project is about maybe 70% or 80% complete.

They are also giving away rather generous rebates - I didn't have much time to go through the details but the sales lady quoted me 25%! So while you'd still have to pay the 10% initially which is quite substantial too because the unit in question was at 1.4 million, you will get it back from the developer. Then you'd end with applying for a 75% margin of finance loan but that is in effect a 100% loan.

Same conundrum lo - are you truly getting a 25% discount or are you paying the true market value which is actually 75% of the quoted price?

Anyway, the situation now that buyers can take advantage of is that these projects are almost done - the risk of abandonment has drastically reduced.

So it could be a good time to see which projects that are well worth the buy but they weren't in your radar back then - could revisit and see if you can find something suitable and you wouldn't need to wait that long for it to be completed. A win-win situation actually.

Property investment simulation

2016-03-11T20:55:00.001-08:00

I created a simulator based on price, loan paydown, market value, profit on sale (including RPGT) and compared against using the same cash outlay into FD or investments.

Running the 2 investment options against each other, while property wins in the long run, the returns actually flatten out over a long period of time because a cash investment (e.g. even at the safest asset class which is FD) gives an ever growing rate of return while a property's value growth slows after 8 to 9 years!

That explains why mortgage portfolios price their rates on an 8-year longevity.

Here is the final result of the simulation with the RPGT in place means that while you are better off holding in FD for 5 years, your maximum return is within the 7-9 year window before the property value growth begins to flatten:

So you would break even at year 5 and have to hold for a few more years - up to 10 or 11 if you want to cash out more but that's up to you.

update: Some anonymous reader left a 'lovely' one liner in the comments saying 'who cares loser'; which seemed rather odd to me because he (usually it's a guy) obviously cared enough to leave a comment? Ah well, maybe you can go write your own blog lor then see who cares or doesn't care..

The Rise @ Emerald, Rawang

2016-03-04T23:18:00.002-08:00

Not sure if this is launched but the details are up at the Guocoland website already but not on iProperty.

Anyway, looking through it, I quite like the 2-storey bungalow design called Sage whereby they have made the length of the lot (66 feet!) into the frontage. The house's footage is about 2,000 sq ft only at 66 x 33 , not sure of the entire lot but there is a curving driveway into the house which is very posh!

Love it .. prices for the project is from 1.5MM to 3.9MM.

Purely for own stay and enjoyment, I reckon. Not for investment or rental income for sure!

Oh I'm sure the value will increase over time but not like a fast flip for quick profits. Those days are gone and while I believe they will come back when the next big wave comes, I don't think that is going to happen for the next couple of years.

Money flowing in!!

2016-02-20T20:49:00.000-08:00

I am honestly a bit taken aback at the sudden rush of cash flow and savings that occurred within the past couple of months.

To wit:

Bonus - zomg, it is the biggest I have ever had in my whole (long) working life! 6 figure bonus. Very grateful and happy.
Salary Increment 10%
Got about a 30k discount on the car I bought
3k on insurance return - this is a regular thing every few years but I tend to forget about it so it's a nice 'surprise'
8k on a cancelled MRTA that was sent to me like 8 months ago but I didn't get the mail because it was at the old address
Saved about 5-6k on airfares using up all my points - non-cash for sure but savings is still income by accounting rules. Or as Benjamin Franklin said a penny saved is a penny earned.
Cash back on sale of old car - 24k, gave half to parents for holiday spending.
Latest EPF announcement of 6.4% dividend - by my calculations, that would be around 30k

wow... I attribute all this to following Buddhist teaching of generating good karma by looking after parents, subordinates, working well with peers and bosses (keeping a positive temperament and no bitchy negative gossip), offerings to devas and boddhisatvas and so on..

Happy happy happy