Dear Diary,
I think 2014 is a good year for myself. But, one of my main weaknesses is I cannot refrain myself on impulse buying especially upon committing myself on a long term deal. As for the example, I bought a car back in 2010 on a very impulsive buying without studying the car in advance in terms of the practicality, aftersales service, reliability and in a long run, would I be satisfied with the car? I thought I would but only after 2 years, I got bored with the car, luckily I managed to sell it off for a fair price and again, bought a brand new car also on a very impulsive manner. This time around, I am quite fortunate because the car has already clocked 95000+ kms in Mileage and so far so good! She still feels like a new car, and I totally enjoyed driving my car around. Of course, there always would be an impulse to change to a new car, especially with advancement of technology, it is very tempting to upgrade. But alas, I think for the time being, better concentrate myself in investment, rather than changing cars. I would like to write a post regarding my ride as she has been a very good servant to me, but this will come later.
So, to elaborate on my impulsiveness, so again I did a purchase of my first property in a very impulsive manner. I took a visit to the show house, I was very attracted to the nice layout and facade of the house, pay the booking on the first sight! I didnt factor in a lot of things before deciding to buy a property which is proven a very risky attitude when comes to Real Estate World. But I think I shouldnt be blaming myself because I do not have real exposure on buying properties, so this is main pakai tembak aje.
Oh yeah, I should write also on my property acquisition later.
Although my dad is a big time ex-architect and his vast experience in construction would be an advantage in acquring a property, he never really taught me how to identify a good property. So I would like to elaborate points, on what should a buyer take into account before deciding to purchase a property.
Pointers
1) Location
All the "Taikors" (Big Timers) in Real Estate World repeatedly tell this to investors, to main points of buying a property is LOCATION, LOCATION, LOCATION. And then you factor in other things before you decided to buy a property. As for an example, my current stay in Bandar Tun Razak was tenanted for 18 years without an issue. Can you believe it? 18 years is not a short time you know, they even had their own house, but they decided to rent it out and choose to stay there. We had to give out 1 year notice before we were able to "get back" the house. It is just a 20x70, simple and run down single storey house without any luxurious look but the tenant stayed there for quite some time. This is merely because both primary and secondary school is just walking distance, banks and pasar are nearby, public amenities are a stone's throw away (balai bomba, public swimming pool, post office, stadium, LRT and Hospital). So this proves that, whatever the reason that you want to buy a property, make sure the location is extremely strategic so it would attract a lot of tenants and push the capital appreciation faster. Well from my point of view, Taman Tun Dr. Ismail is a very good location, is a low density residence, has many good accesses and highways, surrounded with numbers of malls and many other factor that makes Taman Tun Dr. Ismail is a excellent township. No wonder a small single storey house there has fetched for least 1 million in price tag.
2) Access
A good Property must have very good access, which is integral to a value of a property. It must have several well connected roads, close to the proximity of a highway, direct access interchange and alternative roads. My old house in Bandar Seri Menjalara (Which my dad had sold it off) had at least 4 accesses, connected with LDP and PLUS highway with some other smaller roads to Sri Sinar, Segambut, Kepong, and others. The place is very serene also, but as the development became aggressive at that side, now Bandar Menjalara is surrounded with so many things unimaginable. This is because, the accessibility makes the township fluorish. SP Setia built a direct interchange from NKVE to Setia Alam interchange, and this has transformed Setia Alam from tempat jin bertendang to a self sustainable township, for example.
But nowadays, the developer tend to overly developing a residential area without providing good access first. Although the location is good, but bad access could prove a headache. For example, one condominium is just at a side of Kajang SILK, but you need to encircle it for about at least 5kms before reaching the entrance of the condo. And you have to crawl at the extend of busy Jalan Semenyih and some other smaller roads before eventually reach the condo. But still, the condominium was priced at 250k in 2011, and now subsale is around 420k. Looking up at Mont Kiara, it is cramped with too many high density condominiums and the access is poor, but yet the developer still constructing many high density condominiums there. I wonder how is the traffic around Mont Kiara during peak hours.
3) Public Transportations
This is definitely one of the biggest points when considering a property. Good access to the public transportations may attract many potential tenants, although the place is run down or some chow kia low cost apartments, especially if they are within walking distance. I have read in forums, and often I found statements that properties are shaken by nearby LRT/KTM commuters. The effects that these public transportations can exert are great. They will push the capital appreciation faster and surrounding developments too. Once they announce the MRT stations constructions, all this high end and high rise condominiums were launched. And they are not cheap. So, when MRT is fully constructed and available for service, I wonder how much the surrounding property would appreciate.
4) Aiming for the Greatest Capital Appreciation in a period of time.
Of course when you ask a layman on buying a property, they would say "hey, just buy, if you buy one confirm harga naik punya". This is not true you know, some of the property in bukit antarabangsa depreciates after awhile. And some of the properties only appreciate a little, when the owner sold it off he was at the loss actually. So considering this point, sometimes they would ask, are you buying for investment or for own stay? I didnt get this point initially. Actually what it really means is, as for investment, the property must appreciate at its greatest value from one period off time and then you can consider selling it off. For Example, Sentral Residence Kajang was priced at 350psf during launch in 2012, and now as for subsale, the price may have risen to 500psf in 2014. As for my house in Pajam, It is launched at 181psf in 2012, but for subsale, it has only risen to 220psf in 2014. So ask yourself, which is better for investment?
As for own stay, it didnt matter whether it appreciates or depreciates, you will still like the house anyway. Of course, you couldnt be happier if the place you stay had appreciated in case you would want to sell it off in the future. So take home message is, determine what is your goal before deciding on purchase.
Well I would continue to write some other time again because I am too lazy to write now. So, to be continued with several other points
5) First Bullet Theory
6) Reputable Developer
7) Township Vs Pocket Development (Niche Development)
8) High Entry Vs Low Entry?
9) Research
