i think a lot of ppl buying prop is to hedge against inflation like me. when u save enough $, u will pour into prop and repeat the same thing again again until u r retired. (no right or wrong timing, just save and buy like regualr saving plan) when u r old, cant work anymore, retired as nobody want tonhire u , u will depend on rental income to survive. if u unlucky fall sick, ills and need operation/medication, u probably can sell 1-2 prop to fund yr medical bill until u recover/fit. compare to a person, who put all their hard earn $ into FD or enjoy life etc. by time 30-50 yrs later, your 1mil is only worth 10,000 now. how to pay for your medical bill?? history tell us, 30-40 yrs ago , DSL only sell 10k and now 1mil (non prime and become prime now). I learnt this coz my parent did bought a 10k house 40 yrs ago. i want to repeat the same thing. if my parent ills, they can use their i mil for medication . (which i think is enough). they have problem if they rent oni 40 yrs ago

Okla, let's be very straight forward then

what i was trying to tell is that i, as a genuine buyer, will not be caught in the situation whereby after i buy my dream home, continue to pray hard checking market price of my dream home everyday like speculators (i assume you are one of them from what you mentioned in your earlier post). Simply because:

Genuine buyers' decision to buy or sell a property is driven by Need. while
Speculators' decision to buy or sell is driven by "Profit" (or Greed to be RUDE )

So after i (genuine buyer) buy and dream home, i will be off the market and spend more time with my family. Possible scenarios after i buy my dream home are:

Scenario 1: Property prices go up
1) Am i richer now? NO, not until i sell my prop and realised the profit.
2) Will i sell ? No, because i buy for own stay (to fullfill basic Need) and not buying to speculate/invest. And if i sell, where my family going to live? buy another one? Does not make sense to me, for a home to be called home, it provides stability, forever moving/changing house is not good for the kids.
3) Monthly installment affected? NO

Scenario 2: Property prices go down
1) Am i poorer now? NO, not until i sell my prop at a loss
2) Will i sell? No, because i buy for own stay not buying to speculate/invest......(same as above)
3) Monthly installment affected? NO

So, for genuine buyers, so long as we buy within affordability and don't overpaid, property prices go up or down don't really affect us. I will not have your DIlemma for wanting the property prices to go both ways.

Why speculators have the dilemma is also very simple: They wanna to TRADE, therefore wan to always BUY LOW SELL HIGH, therefore need to continuously monitoring prices AFTER they have invested.

Investors (assuming buying for rental income) with financial muscles will now praying for the prices to go down, coz they would have already rented out their investments and now looking to buy more (also for rental income etc), so lower entry cost is always good for investors. From what you mentioned, i don't think you fit into this category. I could be wrong, but i feel that you are caught in the situation because you wan to price to go up for you to offload what you have in hand, and because you wanna trade property, you afraid after you dispose off what you have (and do not sell at the PEAK as what happened to your previous property) then you will need to buy the next property at a higher price (higher risk).

As genuine buyers tend to stick to their home for a long time, say 10 years later (i actually hope i can stick to my dream home for at least 20 years ), i will have peace of mind for 10-20 years.

If die die also wan to consider upgrading 10-20 years later, the same scenario (my scenario now) repeats itself, check affordability etc. So , i don't see myself caught in your "pointing at myself scenario". Because currently, when i pray for the property prices to be adjusted, it would affect my parents house's so called market price as well, but when prices do drop, are my parents poorer? No, not until they sell their house.

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Added on April 12, 2011, 12:00 pmhi hi, i agree with you that new buyers entering the pool of course but perhaps at a slower pace due to Malaysians' stagnant income while property prices shot up crazily.

i also completely agree with you on the foreign investors buying due to our weaker Ringgit (cheaper property prices in their eyes). But i sometimes think that these foreign investors don't invest only in Malaysia, and most probably they have stronger financial muscles then many local speculators. So if anything happens, foreigh investors may be able to afford to fire sale at loss (recover loss from other markets, just like how they invest in stock markets?). Just my guess. And these foreign investors are mostly speculators/investors right? So they are more likely to be competitors to the local speculators/investors.

This post has been edited by godutch: Apr 12 2011, 12:06 PM

Precisely, be remember, RM is only printed out of a plain paper, value can deteriorate under wrong policy.
Same happen for those invest in gold, antique, commodities..., cater for the same needs.

hi
my opinion is..fund the medication fees from insurance. why need sale 1 or 2 unit. Let emple, the property rental collected is 1k/mth, then it is more than enough funding both parent coverage aldy...tis my sense, may b i m the agent and mind set.

Dear all,

Sorry noob question here.
How do you all determine the monthly rental supposed to be for a condo worth let say RM180k in KL area?

This post has been edited by Ash1988: Apr 12 2011, 12:51 PM

i m the one that dun trust insurance, when come to claims they will give u all sort of excuses. the yield is oso much lower than prop investment. agent always exagerate the yield. they oni care about thier commission rather than your actual/basic needs. they shud introduce max coverage with lowest premium eg term insurance etc i/o of saving /investment plan etc. pls read http://tankinlian.blogspot.com/ and all other web related to insurance eg ask mr tan etc. although it is singapore web but can apply to msia too. i can tell u more stories if u want. if my parent bought a policy 30-40 yrs ago do u think they can have 1mil now? in fact they hv multi mil from prop investments from regular saving and invest plans.

What happens when everybody hedges their extra cash in props. Alot of good that will do.

then a lot pg buyers, prop price continue to go up, those who cant afford to buy will rent. i think that is the current market

i doubt those who can't afford will rent. they rent in short term. but when they progress in their career they surely buy.

my fren told me he's from east m'sia renting for 5 years. now he has a stable job thats why he buys a semi-d at saujana putra.

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Added on April 12, 2011, 2:33 pmWhy speculators have the dilemma is also very simple: They wanna to TRADE, therefore wan to always BUY LOW SELL HIGH, therefore need to continuously monitoring prices AFTER they have invested.

they buy low when project 1st launch.. there was nothing around there. after some years they sell due to amenities & commercial areas started to pop out. when there is new access road to strategic key area of interest. that's where they sell at real rocket high price... they tell u to either take it or leave it. if u do not want others wanting it. some of my frens are losing rm10,000+ more from selling price in bargaining when the seller keep asking more. since he knew the seller has other takers.


This post has been edited by toh2020: Apr 12 2011, 02:33 PM

this is a relevant question. in an efficient economy, any surge in demand for one type of inv usually brings about a corresponding drop in return, then many will run off to other options. the same thing will eventually happen with props here.

(in an earlier example, a house in PJ gave avg 6.7% cagr over 40 yrs - which means there are periods of low and high cap appr.
buy at right time, one may think it is normal, easy money; buy at wrong time one may not see appr for a good few years.)

the trouble here is there aren't that many choices to invest or just to hedge against inflation - bursa sucks as it is all epf and other local funds; unit trusts are as bad as bursa; fx sucks becos the buy-sell spread is very large. those amanahs giving 7-8-9%, disqualified.

given the reports of huge sums of capital have left the country in the last 10 years and huge domestic debt have piled up in the same period, it is up to one to take a position whether this prop party can last much longer or not.

This post has been edited by AVFAN: Apr 12 2011, 04:02 PM

AVFAN, 7% is a very good investment already for amanah. Too bad they don't open up much anymore. If not I'll load in more as I found others are getting very risky.

Those funds are fast in fast out. If emergencies can take out anytime.

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This post has been edited by baharinsav62: Apr 12 2011, 05:07 PM

Can you tell us here what is the "average" income per person per month your parents are ?
We can have indicatively that whether or not the current prices are over priced or not compared with the income 40 yrs ago ...

Totally agree with you.
It is one durable commodity to hedge against inflation that capital can be borrowed from banks with lower interest rate (BLR minus).

On top of that one can withdraw from EPF account 2 (* terms and conditions apply), to reduce loan amount.

When the property price increase, it can be refinanced.

This commodity can provide shelter to the owner, unlike some such as gold, oil etc where storage are required.

Party is over in Australia.

http://globaleconomicanalysis.blogspot.com...xury-units.html

commodity prices now diving will add pressure to the aussie mkt.

interestingly, this was articulated in a long article in the same website in dec 2010, was posted in this forum:

Woww.....party over faster than Malaysia.....

Guys, guess when the party will over in Malaysia?

I guess next 6 months...when after GE, pertro + OPR + Electricity + Food raise at same time....

Let's us pray very hard for this to come true!!

Why not choose to be working harder instead of hoping, praying hard for econ plunge? not afraid of chain reaction which will ultimately cause everyone a plunge in income too?

wow, you praying hard for "petrol + OPR + Electricity + Food raise at same time" ???

so you guys actually prefer high inflation just to counter property prices. hhhmmmm... interesting people we have here.
if that is the case, you want property prices to plunge now also can, form a support group and start a riot/protest.
do it everyday and guarantee all property price doesn't just drop, it will CRASH!