The problem with hotspots is that it’s already very expensive, right? However, the not-yet-hotspot is hard to identify. So, how do we know if that certain new neighbourhood may just become a hotspot in the future? What are some of the things we look out for and perhaps buying into it earlier versus later? Property is always an investment yeah.
We could also ask some prominent property speakers but even their answer must be treated objectively. Thus, instead of just asking for an answer, how about we look at a few things that we can research and review in order to at least know what happens before a non-spot becomes a ‘warm-spot’ and when the whole world knows about it, then it becomes a hotspot. Property investment do take some time but it’s worth all the effort and the time. In no particular order:
#1 – Many prominent developers are also buying land within the same area. The prices they are paying are also showing a rising trend. Thinking objectively, if all these developers do not believe in that new area, they would not all buy land parcels in the area. So, the next question is this. What if all the developers were wrong? Their assessments were all wrong and they have wasted many millions or even tens of millions to buy that piece of land? YES, there is a chance all the developers got it wrong but when we look at past records, I think the chances of this should be pretty slim. How to know this? Buy maps from Ho Chin Soon’s office to know more. Alternatively, drive around the area to know more.
#2 – Public transport stations, linked is better. Regardless of how we love to drive, public transport will be the norm in the future. In many advanced cities of the world, they either make the price of cars so expensive or the toll for going into the city centre so high and when we park our cars, the parking rates are outrageous to say the least. The closer the home is to the LRT / MRT / KTM and even BRT, the better it will be.
Beyond just higher cost of driving, when jams worsen further, it will also force a change in action and thus a better pricing for connected areas versus areas where people must drive or GRAB. Oh yeah, some parking rates in the city centre (Kuala Lumpur) today are easily RM25 per day today. It could only go higher. As for those empty land parcels being used for car parks and we have to pay just RM7 – RM10 per day? Those will soon be occupied by another high-rise property.
#3 – Interchanges to expressways. Developers who build interchanges to expressways will help to push up the premium of the property development. This is because for many developments, the expressway may be right next to it but without a direct connection, it will take ‘forever’ to reach it. A colleague once told me that just getting out from her high-rise project into the main road will take her 40 minutes every morning. This is why many times, that connection may take many millions to build but the premium for the whole development will be many tens of millions more…
#4 – Jobs, Jobs, Jobs. Within a radius of 10km, there should be industries or even office towers. We can easily do a rough calculation of the potential number of people working there. If we could see some huge Multi-national (MNC) brands, this is a huge plus because it meant that professionals working there may be highly paid too. It does not matter whether these people will buy or rent. As long as we own a home nearby, it’s either capital appreciation or stable rental returns, both a plus to the owner. Yes, an international airport is going to be a huge plus point and for a very long time too!
#5 – Education. That SRJKC will help tremendously. There are over 500,000 students enrolled into a SRJKC all over Malaysia as at 2018. Yes, for those with teenage kids, a university with the course they love is usually a huge plus. Kids may not love to be near to their parents but parents would love to be near to their children. So, they may buy a unit nearby for their kids to stay and for them to have an eye on them too.
Families with school-going children will be willing to pay a slight premium for these homes too. It’s good to have a POTENTIAL new university but it’s better to trust such news only when we see the foundation of the university being built. By the way, a branded private university will be better than an unknown private university yeah. So, never think everything is the same.
Beyond just these 5, we should note that hotspots to some may not actually fulfil all our personal reasons to love the place. Thus it’s more important to look at all spots objectively, identify the potential ones and buy when prices are still not yet fully up. When many have yet to know about it, that’s when gems are found. When gems are found, that’s when the capital appreciation happens. Of course, there are a lot of other reasons too but these 5 would make any potential area be a potential hotspot in the future. Happy finding your own awesome new property.
written on 1st June 2018. Edited on 25th Jan 2020.
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