but when u retire times... u hv property and no property is matter u (retirement!!!)

there is no free lunch.. house owner not stupid anyway!!!

In fact, prop investors can find good deals in public auction, if search hard. My friend bought a few auction properties in 2013, around 30-40% below the market price. He acquire it via auction, renovate and touch up, rent it out, all could be done in 4 months time. Quick turnaround time.

Alright, if double then sure can. Then the questions is, if double income, they could definitely buy a house instead of renting right? And since they can afford to buy for own stay and perhaps have also bought it already. Then who is gonna rent the rest of it from the market?

After QE tapering, expect effective bank interest rate returned to pre-2007 level i.e. 3% higher than current. New supply of property for demand created by flippers will be in surplus. Don't expect aggregate income to rise faster than inflation. Many dibs projects take vp within a short period of time. Property valuation is substantial lower than asking price due to auctioned price.

Matured areas damandara heights, sri hartamas, desa park city, TTDI, Bandar Utama, Bangsar, Kenny Heights..and several others..even when property bubble burst..how much can d landed property prices dropped in these areas? 5% ??

After QE tapering, expect effective bank interest rate returned to pre-2007 level i.e. 3% higher than current. New supply of property for demand created by flippers will be in surplus. Don't expect aggregate income to rise faster than inflation. Many dibs projects take vp within a short period of time. Property valuation is substantial lower than asking price due to auctioned price.
During crisis, property market will be segmented into 2 i.e. private sellers and foreclosures. No private sellers is willing to sell at a lose hence asking price always include his cost, expenses and profit if allowed; hence to general public and re agents, price is stagnant or even rise with interest rate. However, in foreclosure sales, price can be 40% lower as happened in the U.S, U.K, Spain, etc.
In economic, anything could happen in the short term. However, no one include gomen, collection of companies could resist price returned to equilibrium.

For any extra RM spent on housing loan repayment, there is a RM reduction in disposable income. Given residential properties don't generate income or add value to aggregate economy, except to banks, house price increased is detrimental to aggregate economy.

These were the places that went thru the 1997 and 2003 global crisis without major price downward adjustment.
I think the "save area" would be extended to some other mature area, such as Puchong, Kepong, Cheras, Sri Dsara, Sungai Buloh, SS2/3. Shah Alam landed properties where most of the landed properties are owners occupied. Owners would defend their own shelters to the death, so possibly there would be price stagnant but no transactions scenerio during the bad time,, price unlikely to drop significantly. 

The concern would be more on the fast growing and more likely oversupply area, such as Cyberjaya, Mont Kiara, Jalan Ampang row, Ara Dsara....No offence to those who have vested in this area, this is my personal observation.

If 3% higher as you said, then anyone paying a 500k loan over 35 years will have to pay 3406.99 monthly instead of 2397.34. That's a difference of RM 1009.65 or 42% additional every month for instalment. Ouch, that must be painful.

Yeah, rental rates never really goes up but prices of property goes all the way up. I foresee that many people will not buy property in the future and just go on renting. Why buy and pay instalment at RM 2500 for the mortgage. If for me, I would rather rent at 1500-1800. Let the owner worry about the instalment and maintenance and miscellaneous. If owner wanna increase rental, cabut to another cheaper rental location. Living nomad live. Atleast can stay in many new house and make the house dirty and move to new place again.

I definitely know some people is doing that already. LOL

https://forum.lowyat.net/topic/3102196/+20

Please read post #23 to #34 some people's experience there. Will the bank alter monthly installment when BLR is up ?

In fact, prop investors can find good deals in public auction, if searching hard. My friend bought a few auction properties in 2013, around 30-40% below the market price. He acquires them via public auction, renovate and touch up, rent them out, all could be done in 4 months time. Quick turnaround time.

Really? From my calculation, the max bank will be able to maintain the same payment and extend the tenure if interest only rises a maximum of 1%. Any figure higher than 1%, the same amount of instalment cannot even cover the interest portion. Basically that means the loan is ever increasing without an ending.

Perhaps their situation is different that they are taking a loan of less than 35 years. Maybe their loan tenure is 15-20 years. Perhaps you shall check on that.

If you like to do the calculation, you can go to:-
http://dailycalculators.com/mortgage-payoff-calculator

Put those in to get the monthly instalment amount.
Present Value: 500,000
Rate of Return: 4.6
Desired Months To Payoff: 420 (Which is 35 years)

You will get RM 2,397.34 for monthly instalment

After that, do this:
Present Value: 500,000 (Remain Same)
Rate of Return: 7.6 (Up by 3%)
Desired Monthly Payment: 2,397.34 (Maintain your instalment)

Now tell me if the calculator show you how long to pay off in months? This loan will never be able to pay off. Cause the interest is higher than the instalment.

If you don't believe the figure, then look at this amortization chart and see how much is the interest portion http://www.amortization-calc.com/#loan-500...35-7.6-1-2014-2

I am kind of want to do that after selling my properties.

I don't hope a bubble or crash. I expect market correction shall be more accurate.

Never doubted your calculation.

There are many variables that affect the calculation. Like you said, some will be having loans which is <35 years. But based on your parameters, the breakeven point where installment = interest portion of the loan is when the interest increase by 1.15%. Theoretically, bank could allow the same installment amount to run as usual if the interest rates increase by up to 1.15%.

Hence, assuming banks allow flippers to pay installment = interest cost, (ie no principal repayment for crisis period), then using your parameters, the interest cost is RM3166.67. The amount flippers need to top up for 3% interest rise is 3166.67 - 2397.34 = 769.33 pm. Theoretically lah 

For business loan, a friend of mine was allowed to service interest only as his loan amount was too big and his business failed. Is there a similar one for property loan ?

in fact the owner also not really want the tenant to stay forever in the same house.. as the owner can raise the rental up to market value to new tenant more easily then to increase the rental for the current tenant.

again every cent is count.. no free lunch actually..

i dun think so.. bank will lelong the house quickly.. but for businesses, bank cannot lelong the business ma, who want the losing business then.

Never doubted your calculation.

There are many variables that affect the calculation. Like you said, some will be having loans which is <35 years. But based on your parameters, the breakeven point where installment = interest portion of the loan is when the interest increase by 1.15%. Theoretically, bank could allow the same installment amount to run as usual if the interest rates increase by up to 1.15%.

Hence, assuming banks allow flippers to pay installment = interest cost, (ie no principal repayment for crisis period), then using your parameters, the interest cost is RM3166.67. The amount flippers need to top up for 3% interest rise is 3166.67 - 2397.34 = 769.33 pm. Theoretically lah 

Yup its about 1.15 to 1.2% from the parameters. Even if the bank allows servicing of just interest alone of additional of 769.33 p/m. That's a whopping 32% increase of instalment with just about 1% changes in BLR rates.

If I'm the bank, I would definitely allow that. Just pay me interest every month at 3166.67. And he/she still owe me 500k without any reduction. If can't pay, I foreclose the property and he/she still owe me that full sum minus what I sell the property and other miscellaneous charges. Win-Win to the bank only lar.

Sounds very like loan shark already. Every month service interest only without reducing balance. That's is even more expensive than renting I think.