Let’s look at this topic today, ‘Property Prices in Malaysia.’ Note: Every state, every city would have a different number yeah. This stats is for Malaysia as a whole.
Yesterday (no, not that song) as in long time ago.
When I first started to invest into property (I define investment into property as second property onwards). First property is just to ensure we do not need to pay the below rental amount even after we retire.
Rental per month: RM2,000 Number of months (in a year, haha): 12 Number of years: 25
Calculation: RM2,000 x 12 x 25 = RM600,000. Yeah, this is the amount we need to be ready if we do not actually own any property which we could stay in. I know, we could decide to rent just a room instead when we retire, right? Tell me all my dear readers, after retirement, we still want to be cooped in a room and watch some shows on our notebook? We could NOT even watch the TV in the living room because the owner is watching his favourite show or other tenants were watching some shows we do not like? REALLY SO SAD?
TODAY (as in now and the near future)
What has happened to the property prices of the properties I own Well, for the ones bought before 2013, if I do sell now, it would mean lower profits, nowhere near any potential losses. For the ones bought after, I better hold because the market is not that conducive for sellers.
So, the question for all owners would always be, ‘could we hold’ or ‘do we need to sell.’ If we look at the Malaysia House Price Index, it seems that there are more Malaysians who could hold versus those who have no choice but to sell cheap. Well, seems to be like that until Q3 2020.
In Q3 2020, the property price has dropped, finally. I say finally because the chart says so yeah. Take a look at how the property price had been trending.
Tomorrow? (As in future, probably 5 years of more)
Ask ourselves very seriously. Are we ready to rent until they day we say good bye? Any decision would need an action. If Yes, we want to rent, just get ready the money. If No, we do not wish to keep paying rental, then it’s really saving… then buying and continue repaying for the next 30 years and STOP. Yea, if it’s the home loan, it usually has an end yeah. Rental is meanwhile forever… and ever.
Ask our partner very seriously the same question too. Own a home or rent a home or rent a room. Anyone answering rent a room / home, please do note that many future father-in-laws would not like your thought.
Ask ourselves whether property price would continue to inch upwards. Whether it’s 1% or 2% or even 3%, if it’s 30 years, the property price would still at the very least, doubled. Consider that as forced savings since many could not save independently anyway. If we think property prices would keep going down, then get ready yeah. We will soon be spinning into a financial crisis. Never before in the world where the economy does extremely well and the property prices fell to extremely low levels. Please tell me if you know of any. Thank you!
Conclusion
Property wise, I have moved many times. I am only speaking about homes I own yeah. If you like to know reasons to move, read here. Reasons to move homes. I am not that attached to any particular property. It serves a purpose; to give me a home. Once I found another home I love, then the current one could become a home for someone else. Yes, I should be moving again next year. That’s 2021. As for those always sensitive to the topic of property prices in Malaysia, just note that for most years, it shows a positive number. Low or high is another matter but it’s a positive number. Cheers.
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