QUOTE(Gravity @ Nov 18 2014, 04:55 PM)
Point 1 - construction cost
what im trying to convey is that cost is continuing to rise. Bulk of the cost will falls under land acquisition cost. Land cost and construction cost will not fall unless major global event happen. On top of that, developer will want to make some money out of the project. Hence, the price will always match the vacinity. Thus, maintaining the price at a higher than market value level.
Point 2 - foreign investment
I was basically refering to FDI. If you're investor and you realized there are high capital appreciation gain investing in KL, why would you go for jakarta or Bangkok which price is already hitting a probable ceiling. Hence, people will still come back to KL for investment. No doubt the government has implemented many ways to curb the speculation, but for me, when there's a will, there's a way. The rich can still invest via different route.
It's all about ROI. Property gives you 10-30% of your purchase value, not your investment amount. With leverage from banks, a property of RM500K, you only need around RM50K and say RM10K for expenses. A 10% rice in your market value will be already RM50K, hence there's effectively almost 100% ROI on your RM50K investment.
Pricing higher than market value is only possible in the bull market.
People buy overseas property doesn't compare with home country or neighbouring country price e.g. many malaysians bought in sydney, melbourne, singapore and london not because the price is cheaper than kv. hence, few foreigners buy kv property because it is cheaper than bangkok or jakarta.
foreign buyers tend to buy near landmarks e.g. klcc. troika vp in 2009, price has been flat since means few foreigners are buying.
cocr was not a traditional measurement for accountants but invented by r.e agents for flippers.
QUOTE(cfa28 @ Nov 18 2014, 05:57 PM)
Nope, fall of 5% - easily kena sapu by secondary bargain hunters
To trigger a downfall, you need a slowdown in overall economy
Even if 10% to 15% of flippers sell below cost on VP, still no effect cos will kena sapu
QUOTE(cfa28 @ Nov 18 2014, 06:14 PM)
U can sell immediately on VP, only issue is the price
Do u sell at Cost - 101% kena Sapu immediately by the Agent himself / herself
U want 5% Premium - sure got ready buyer
U want 10% Premium - have to wait a little longer lah
U want 25% Premium - have to slowly wait
U take any Condo project, even say 9-Seputeh
If even 15% to 20% of Purchasers suddenly wanna sell their units at 10% below cost, what do u think will happen
All the cash rich ppl or those who have yet to buy will sapu, so the Banks can recover their losses from these new purchasers over time
Mean time, they will sue the Flippers for their pants and A55, so there is no Bubble
For Bubble u need whole of KV Property Market to collapse, which is not likely
This was what gold punters believed, there is no doubt, some ignorant bargain hunters will pick up initial round of discounted price. Those cash rich people who were not in market earlier were expecting price drop, will wait for the price to bottom before cherry picking.
Most if not all flippers will not sell below their expected profit willingly. They would rather hope to get a higher price at foreclosure auction than lower price in open market.
property price will take years to bottom.
This post has been edited by icemanfx: Nov 19 2014, 07:10 AM