A friend told me that she could not rent out her flat. She said she bought the flat long time ago and until now still not rented out. On and off she would bring potential tenants but none of them wanted to rent. I asked her a few questions and she told me this, ‘everytime I go to my flat, I feel bad. It’s already so old, paint is peeling off, even the toilet is not really working anymore.’ Friend, IF YOU HATES the place, why would people love the place? Rule no.1 is, never buy a property which you do not feel good about. Chances are others would dislike it too.
Buying a unit below the road level. There are a lot of people who said, they don’t mind to buy properties which are below the road level. If it is for your own stay and you intend to stay there forever, sure, go ahead and buy. However, please be reminded that if floods come, you better start packing. Secondly, when you need to sell, at least 90% of your potential buyers would not even view your unit if you tell them that your unit is below the road level.
Two condos, one basic unit with 2 car parks and you are single and have just one car, another unit is fully renovated and you love it a lot but with one car park. Same price. Which would you buy? To those who said the one with one car park, you can stop reading this article and move on to the next. Renovation, you can do it even better if you engage a better interior designer. However, it is IMPOSSIBLE to buy one more car park in the future and today, any new condo comes with 2 car parks as standard. Thus, your unit would be minority in the future! If the rental of one car park is RM150 today, it is RM1,800 per year. To earn back RM1,800 from FD, you need to deposit RM60,000 into the bank and leave it untouched for 1 year! Car park rental can only increase……
An area, right next to a popular area is 30-40% cheaper. Lots of land undeveloped. Your friends all say, don’t buy, no one buys there. Be diligent enough to do more homework. Get to know who owns the land parcels. Be objective enough to know that it may take time but if an area right next to it is already 30-40% more expensive, it is just time which stands between you and potential capital appreciation. Of course, if you can ONLY afford to buy one unit, then perhaps you can be objective enough to buy somewhere else easier to rent out instead of buy and wait……….
In property buying, objectivity is very important. If I was not able to think objectively, I would not have bought leasehold, bought nearby cemeteries and even bought in a less popular area which have all proven to be profitable. Or perhaps I was just lucky though I always believe luck follow those who work hard and do more than others.
written on 31st dec 2013
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