In 2005, Ben Bernanke (Chairmain of federal reserve) said on an interview that the US property price will not and impossible to burst. Look at what happen in the US in 2008? And the same thing will happen here in Malaysia.

well, i assume u fully understand and expert then.. Tell me why Ben Bernanke said that US property crisis will not happen back in 2005.

For speculators, I would suggest u guys start saving a bit. Not need to go all out la. Chinese says, if its belong to u, it ll end up urs. Otherwise no need to blame or force la. (Sori har, my england not so good la)

Good for u. Smart har boss. Earn how much. Can share ga?

i am aiming shop and factory coz during bad times u hv more chances to grab good deals.  i missed opp during 97 crisis where danaharta offered(few years after 97) many factory lot in good locations at great discounts. i didnt see much offer in residential prop during 97.  i guess most ppl has the holding power.  the opposite in US where most ppl has no holding power in residential prop.  shop/factory are still doing ok.

Well said dude. I'm in diff position. I dun own any but I'm managing my bosses props which can fetch handsome return. Factory bot less than 5yrs ago can double de price with 4. Offers at a time. It onli happened in tis few wks. My bosses view r diff. They refuse to sell. They r terbalik a bit wan. Proposed rental increment due to good asking price. Is tis a Gd way too???

Ok, enough of me repeating the household debt. Now let's look into disposable income. Now read this:

"Looking at the problem from the ratio of household debt to disposable income, this ratio is 140.4  per cent for Malaysia, one of the highest in the world; above that of Singapore at 105.3  per cent, USA at 123.3  per cent and Thailand at 52.7 per cent in 2009. This means that the loans taken by each household in Malaysia is on average 1.4 times more than its household income. 

Since both the household debt service ratio and the household debt to disposable income are average figures, in reality it will be those in the lower income group who are at greater risk of not being able to pay off the monthly instalments.

Spending using borrowed funds can boost economic growth but it can also slow the economy when households are forced to restrain spending in order to service their loans. Thus there are unfavourable policy implications and economic impact when household debt keeps rising."

Conclusion:

- Malaysian household debt to disposable income, ratio is 140%
- Loans taken by each household in Malaysia is on average 1.4 times more than it's household income.

Just imagine your salary is RM1000 per month but you hv to pay monthly instalment loans of RM1400. The debt will keep on pumping. That's the reality that is happening to us all. It's a fact. Now please give me some facts that can deny my theory..

just finished my breakfast.

1. Like I mentioned before, all this was done during the past 3-5 years. The recent 70% cap on 3rd property onwards has slowed down the plan for me and many other investors. Before the ruling, most banks would lend you 90%+legal fees up to 4th or 5th property but of course now they cant do that anymore. I'm just thankful I managed to pick up a few before the ruling was accounced. If you still want 90% for 3rd property, MBSB can give but at higher interest rate. They're not a bank so not affected by BNM ruling. No bank is allowed to force you to buy MRTA, the most is your rate will be 0.1% higher if you choose not to take MRTA.

2. Places priced <RM300k with => 7% yields 3-5 years ago:-
    - Cyberia & Sunway student apartments
    - Studios in Maytower, Amcorp, Ritze & Plaza Damas etc
    - Old city center condos like Forum, Vista Damai 1room
    - PJ condos like Pelangi Damansara, Millenium,
    - Danau Desa condos
    - Old Bkt Bintang/Ceylon condos like Angkasa Impian 1 & 2, City Garden, Mutiara Villa

    If you had bought any of the above condos 3-5 years ago, most would have given you about 7-8% returns THEN,
    and >8% rental now.
 
    Nowadays tougher to find high yield properties <RM300k, but 3-5 years ago so many around until dunno which one to buy.

3. Yes I have bought 2 property at the same time before, apply to 2 different bank, both approved. At that time my salary still below RM5k and I did not have any FD. If you are nice to your banker, and dont act as if you know everything, they may be nice enough to explain to you why this is possible.

4. This is why its safer to have 10 rental investment properties compared to just having 1. If you have 10 cashflow positive properties, and suddenly you lose your job, and say 1 tenant just left, you still have income from 9 properties to sustain you. The probability that all 10 are vacant at the same time will be very very remote. Even if 2 or 3 out of 10 are vacant, the 7 that are still tenanted should be able to sustain you.

5. My first salary was only RM1800, for the first few year of working I continued to drive the same >10 year old proton iswara that I drove while studying, later I upgrade to a 12 year old Wira which I'm still driving now. Even after my salary increase, I still spend as if my salary RM1800 so no problem to save 2/3 or more of my income.

In fact I bought most of my property while I was having a fixed salary job. I resigned to join Real Estate agency only after my passive income from my investments was decent enough to sustain me.

It is a mistake to think that all those people who are owning multiple properties now are taking a high risk gamble. Most are those who have gradually build-up a portfolio of cashflow positive rental properties over the past 5 over years when property market was quite stagnant.

If we only did the simple and risk free things, where would we all be today?

There is difference between Malaysia and Spain.

Malaysia has high saving rate, which is the strong backdrop supporting point.

Also, Malaysia doesn't have unemployment issue if one is skillful enough, one shouldn't have problem to find the job in Malaysia at current and near future, in fact, most factories are short of personnel across, from operators level, technician and engineers.

I feel its better to teach our children to live within their means/affordability. We have to set a good example. To take an uncalculated risk and then to lose all your saving on an unaffordable property is much worse than not having your own house.