Definitely the bubble in Malaysia will burst soon! Interest rate has just risen, give it 6 months to see the impact. Penang property prices have gone up even crazier than KL! Single terrace house 1700sf bad condition is asking for 585K!

The price hike was mainly due to investors taking profits, buying and selling, not real demand supported by local folks.

So many apartments have very low occupancy rate, a lot of properties are out for rental but noone is renting even in prime area coz the price has gone up too much!

Do you think the price will sustain?

Supply more than demand will definitely drive the price down! Those investors who leverage on bank loans with many units will panick when their units cannot rent out while the bank rates keep going up!

So, be patient and hold your horses for now or you might be caught!!!!

I am considering buying property for own stay / investment. Some said if dont buy now, will never afford in future. Some said the price is too high now. Should wait and see...
After reading this thread for some time, I still dont know what to do...
Just wonder how people can have so much $$$ to own so much, while some graduates studied hard and worked humbly for more than 10 years counting every cent before purchasing...
I guess $$$ goes to the risk taker...

Example, just after the crash I watched a property in Damansara Heights start at RM6.5M, then dropped each consecutive month by RM500K per (for 3 months only) to a final asking price of RM5M.  I offered RM4.2M, the property sold for RM4.5M.  At this low from ask to sell, that's 30%!  Listing in this area are now triple what they were a few months ago, the market is repeating it's cycle now all the global stimulus is running out so I'm liquid and ready!  2-3 years will the time to buy!  Right now and for the next few months is the window to sell.

in spite of reservations expressed by some quarters of a possible downturn, i attended a soft launch of some semi -d last week and they sold out on same day!!!

I guess if you feel in your gut its a good buy, go for it!

Flipping properties was so 10 years ago in the western world...been there done that...did well but you need to know when to take profits, see the trends and move on ! 

I have just seen the error of this in KL in Bangsar with the new condos at BSC area.  These were speculated and already cant be sold.  Asking $1000/sqft, I have heard some are being let go for $700 per.  The owners have lost the 10% down (around RM400K), now built cannot rent to carry the prop so OUT!  These early dumpers are smart, others will go into denial and loose more.  It's true, many can cover the losses easily but most cannot.

Right now volitility has become the new market norm.  Dont expect fundamentals to play a part for the next 3 years minimum.

Even Nuriel Rubini is stating a 40% chance of a double dip in the USA and EURO on Par with USD.

Listen, if you fear the new rules of 20-30% down are going to price you out of the market down the road, you shouldnt be buying property in the first place.  Put it this way, and this is simple stuff, you buy now, property drops 10%, your downpayment is gone.  Inflation is kicking in while asset deflation is as well so all it takes is a jump in interest rates and your done!  btw, I'm trying to be optimistic at 10%.  Save you money and be ready to make your move.

I agree that if you buy in the right location in KV you might survive but why even risk it!

Check out One Menurung condominium project adjacent to Bangsar Shopping Complex, KL, and you will appreciate how a speculator caught on the wrong foot can lose RM400k more or less. Great location, big luxurious units 3-8000 ft2, now largely vacant with many units looking for tenants and buyers. Selling price? Asking around RM750-1250 psf still.

those say not burst, y not sell u dsl to 1mil if now worth rm600k see got ppl buy or not...if got ppl buy, then congratz...

why gov need to take prevention, sure got analyzed before.

4. Banks have ample liquidity and want to lend? Again, I'm shaking my head, because I may have an insider view on that. Banks are under EXTREME pressure to shore up more liquidity! Why do u think there are tons of aggressive deposit campaigns suddenly popping up? Some banks are giving 5% FD for fun? Have we ever asked ourselves why? (The rationale behind this is worth another separate post) Now, these jokers from OSK want to say that banks have ample liquidity. Sheesh.

EARLIER this year, a relative of mine managed to sell his Bukit Sentosa house after four years. Its closest town is Rawang.

He decided to relocate back to Petaling Jaya. But property prices have gone up so much that he now has to rent. In his late 40s, he hopes he does not have to go on renting.

But even if he were to get a suitable place, there may be problems with financing because of his age.

This relative belongs to a group of people who will be retiring soon but who do not yet have a roof over their heads. He is what developers and bank officers would call “a genuine house buyer.”

With property prices going up since the second half of last year, what are his chances of having his own home? Dicey.

Therein lies the problem in today’s property market. On one hand, there is the low interest rate. On the other is easy credit. Yet both are not helping him.

On the flip side, it is encouraging many to speculate. These two factors – low interest rates and easy financing – are supported by various schemes that are being promoted by developers.

Among the most popular is the 5/95 scheme, or variations of it, which started early last year. A buyer merely pays 5% of the price of the house and does not have to pay anything until he takes the keys. All interest payments are “absorbed” by the developer (Psst! The interest is priced into the value of the house).

Some schemes do not require mortgage payments until the sixth year of purchase. One developer requires a downpayment of only RM5,000 and no more because it also offers a 10% rebate, which buyers can “use” on signing the sale and purchase agreement.

No payment is required until completion of the property and this RM5,000 is used to pay for utility deposits and maintenance deposit. Whatever is left is “refunded” to the buyer. Such schemes encourage speculation.

While Singapore has banned them, developers here are still rushing to launch their projects using this form of financing. Early this week, there were talks of increasing down payments to 20% or even 30%.

While this will not weed out speculation completely, it will serve as a deterrent. Such a move will also help the banking sector indirectly.

Out of every loan approved by banks today, one-in-three to one-in-two is a property-related loan. This compares with one-in-five prior to the 1997/98 Asian financial crisis.

With such a huge exposure to the property sector, in the event prices become unsustainable, the banking system will be adversely affected.

At the beginning of the 21st century, US banks gave loans to home buyers who would normally not have been given credit.

These borrowers were allowed to buy houses by paying slightly more than normal rates, often with floating interest rates that rise and fall with the general market. The relaxing of credit standards led to ever-increasing house prices.

Many bought homes they could not afford, but assumed that the rising property market would help to cover their loan commitments, which would allow them to refinance later on, once the value of the house climbs up.

When the bubble burst, house prices fell and so did the banks. This became what is currently known as the US subprime mortgage crisis.

With today’s easy credit and these 5/95 and 10/90 schemes, something similar seems to be happening here in Malaysia.

There is also the absence of housing between the RM250,000 and RM300,000 price range. Even a studio apartment of about 650 sq ft can cost about half a million ringgit.

Developers justify their penchant for building high-end launches with the rising cost of building materials and the desire for lifestyle living. Not every one is seeking after that dream home. Certainly not that relative of mine.

● Assistant news editor Thean Lee Cheng thinks it’s time to nip speculation in the bud.

yeah i agree wit that...it will only affect short term flippers
the big investors just need to hold the properties for 5 years and can get away from rpgt
the problem is still not soved

what if every one jack up 30% and valuation also jack up by 30% and bank refinance after jack up 30%

then property prices will go higher... cant you see?

anyway, if no one want to buy, those sellers are not in a hurry to sell too...so buyers have no choice but to follow with additional payment of 30% to the government.

can't you see that the government are short of funds and its high time to get more money in thru rakyat's nose and earn praises from the rakyat.

its a double edge sword!!!!
MALAYSIA BOLEH