how to invest in property in malaysia (in 2020)


Hi, this is CF Lieu for
AskCF and CF Lieu channel. Now in this lesson as we move
to what’s your year 2020. And they share some insight with you if
you were to be a property investor in the year 2020. So let’s
get right into this. Now. This is a really a big mind map, so I’m going to walk you through each
and every of these pointers that you should take care about. Now the first, the first thing that core of what I’m
covering today is actually a public news piece by someone. Uh, called Siva Shanker and Siva Shanker
is really a highly respectable, uh, real estate, uh,
personnel or a celebrity. I wouldn’t say that, but uh, it’s really an established person in the
real estate industry without the normal connotation of being a property
guru. As you, as you know, I’ve seen that already and this
is really his insights. Rand, he was invited to speak at this
the Edge investment forum, uh, on new SD in 2019. Now, one of the point, very important point that he mentioned
is there is a sign of times when property price a price too highly for
the average person to buy. And there’s this growing phenomenon of
a generation of renters or more people can only afford to rent rather
than to actually own a home. So we are really like move us towards
like what we know like is happening in Hong Kong. Right? But yeah, a few
highlights here and from his observation, obviously some insights for you as you
want to become a property investor or you want to start your property investment
journey in Malaysia. Very important. You know that more and
more before we renting. Now that might seem like a
very good thing, right to know. But the thing is, uh, he’s cost by Salary and income cannot
keep up with increasing prices. People cannot buy house. However, however that also means young people, uh, start to have this mindset you
probably in your 20s to say, Hey, I really don’t need to buy a home.
Now that that might seem like a good, like I say, a good problem
because basically, you know, the rental market will
be so-called vibrant, but it will actually affect you if you
have a property that you want to sell five years, 10 years down the road. Because even at SF now people are the
new generation people who start working already have these Mindset not needing
to buy a house because now you know highly mobile. Well they can actually, I mean not owning a house gives you more
mobility to say this year I’m going to in Malaysia, next year I’m going to
Singapore and then the next, next, yes, God knows who you are going,
where you’re going to go. Now he’s about life experiences and
you see this other trend when I’m, I want to share with you, um, uh, some of my clients who already invested
in property followed them past 10 years, maybe in the early 2000 and then
their, they probably like 100,000, but they want to sell it at
300 or 400,000. Now supposedly
do sub sale property. their property which is like 15 – 20 years
old could actually fit the budget and the salary of today’s people, 20
something that only start working. However, they still cannot buy
that. I cannot sell that. Why? Because the new generation, again, like what Siva Shanker say
they’ll have the mindset, they don’t need to own the house. So they could be more and more about
in terms of where they want to stay, where they want to live and work. And
the second thing is, because that’s, let’s put it that way, 20 something. If
you were to buy a 20 years old property, there will be a high maintenance
costs involved and they probably, they don’t like the feel, the look and a feel of
these are OLD property. What can be years old. Okay. And
it’s not a glamorous thing to do. Imagine compared to if
you buy a new property, then you call for a housewarming
with your colleagues and friends. So a lot of the younger
people have a pride, right? Because these are new property, but for
old property, um, not so much. You know, not so much so much They would rather
either buy it by those new property, which probably cost a million or
so. But if they cannot afford it, I’d rather not buy. And they rather actually defer their
decision that they buy a property. And according to Shiva
Shanker again, why, why, why is this white con this new property be Sold at a more affordable
price, you know, government, which I always want to say that they have, have this developer to actually
buildand construct affordable housing, but the fact is did right price
of land continues to go up. And because the price of land is part of
the cost for any property that is sold by any property developer. So this cost is passed to
you as a property investor
or when you’re wanting to do a property investment, which is
why, um, yes, the property price, might not have gone up, but the, because the land price goes up
that it’s factoring in to the, uh, so-called the developer land bank, the cost of a land bank and
developers as you know, that, that in 2011 to 2013, developer used to give a lot of discount
and freebies to buy and now even now, right? Even now they
give you a huge discount, a lot of freebies like free air con, a
pre-install and [inaudible] something. No Money Down down free Stamp
Duty, they cover the stamp duty. They cover the cover legal
fees -free everything, but you have to know that I have to
agree with Siva Shanker they’re saying nothing is free. There’s no
free lunch in this world. Right. The thing is is is this a matter of who
actually borne the cost of so-called package at free? So they are going to add that in into
the building costs and I’m going to sell you, this is just a marketing gimmick.
Alright, so people hear ‘FREE’, they like it very much. Now the
other thing is because really, um, the, it’s really no
alternative. Accordingly. Shiva, there’s no alternative asset class
for a lot of people to invest. I mean, especially in Malaysia. So yeah, always do focus on residential
property if they have like, you know, property, I’ve had a lot of content, extra money and some of them
actually only look at to say, what property can I buy? What property can I buy what
property can I invest into? Right? So these activities distort uh,
the, the, the whole market, the one, the gap between the have nots
and the have’s actually widens. And you also have to
understand that, um, um, there is actually in a more easier
way to invest into property today, not directly, not directly.
And you actually, uh, invest not in residential property
where a lot of people are focused on, you’re actually investing in commercial
property and you might think, tell you are, you are
talking about, right? I mean, I thought commercial property would be
priced much higher. Uh, so, you know, it’s really not everyone can get invest
into commercial property, but no, it’s what I call it as a proxy for
commercial property investment. I know you don’t have these
tenancy has so and you know, loans to deal with and that is called
real estate investment trust or reits. Now if you really want to actually check
out some of the lesson I publish on my channel, YouTube on reits, you
actually go click on the uh, lower upper right hand corner ways
popping up and I’d get lesson actually get us, I think it’s getting like hundreds
of thousands of views every single week. There’s one our most popular lessons
video in this in CF Lieu channel. So I mean, after this exact sharing ends, I will really love you to
actually check out on that, okay, that when the most popular now, so a proxy or alternative asset class
rather than a direct property investment, but you still underlying, I say still
a what we call it as a property, but commercial property.
Okay. So I’m moving on. Um, the high selling price, it lead
to a lot many people to uh, to actually rent rather than to buy.
And you know that um, furthermore there is the over supply of residential property
in the market, what do you call it? It’s a property overhang and these, uh, these are purchased both by the property
investor that is able to hungover, that is intending to hold for a long
time and they’re also speculator the only one to buy and flip it after
the construction was completed. But the thing is both of
this group are people, a property investor and speculators. They are also having a problem where
first let’s talk about the property speculator, the one who wants to flip
their property, they cannot flip it. Okay? They cannot let go off their
units. And why is that so hard? I have an extensive, another lesson that I
published a previously on this, on this topic. Why you, you are not able to sell
your property fast. Okay? Just kick on the uh, upper right hand
corner where it’s popping up and then, you know, I mean, just digest that lesson after this lesson
and this video and you could see what are the reason why they
cannot sell. And because, uh, just for the sake of completeness, I
also told you share if you about, um, a property is as good as
it is when it comes to, it’s near to where you want to
stay, right where you want to stay. And then of course if it’s
near to where you want to work, there is a bonus point. But the thing is we’ve all this new
generation being very mobile and you know, coworking space and Oh that you, you actually slowly realize that um, property when it comes to property, the location is not
that important anymore. It’s that it’s getting less important,
actually, uh, uh, these, uh, respect that Siva Shanker also
highlight that this point, I wish I’m going to show you. But yeah, a lot of reason why when people say
property is all about location, location, location, when nowadays the
trend has already changed, right? If you still think location is the number
one thing when it comes to property investment, then slightly
you are missing out on that. So location is no longer important. Now this is a very controversial point
but I really want to share with you why you, a few reasons why location is getting
less important because there are other factors that are getting
more important now. And I want you to check out
another video that I have. I actually publish in this channel and
why location is getting less important. And I just click on the upper
right hand corner of the list. We do [inaudible] a list of this
resources of our property investment, uh, sincerely yours from uh,
independent, licensed, financial advisor and not a property
guru. So you balance out, you know, you listen to the property guru, you
also listen to people to actually, uh, advising. A lot of clients are on the investment
and or which includes property as well. So back to here, they say that, okay,
they cannot. Sold after completion. So if the 10 they want to sell, but
then even the speculator cannot sell. If you are a property investors
probably they don’t want to sell. But regardless, they also fall back to the same problem
because they are so many units for rent. We are talking about law of
demand or supply here, right? It push us now what I call is the
push down the rental rates, right? Leading owners to being unable to
cover for the mortgage repayment. So you may do renting only at 1000, your mortgage is 2500
then you have a negative, it’s not an investment because
[inaudible] yeah, I mean Even any in there that cannot
guarantee you make money. But when you have a property
that you lose money every month, I think that is a liability
is not an investment anymore. If we continue for the two or three years, you know that it’s really
bleeding a lot of cash. And because of this over
supply, you really cannot, um, uh, Cover your mortgage
repayment, there are few reasons. Oh, so like for that. But if you
really want to actually, uh, better your rental income in case you
are reading this and you are a property investor already, I also have another
lesson published on that, right? Why your rental income cannot increase
and you know what you can actually do about that or check out another lesson
that actually I want to refer you to. Uh, for this topic. Uh, we keep popping
up in the upper right hand corner. Like why did you always feel there’s a
rental issue and how you could actually mitigate the risk. Now back to
what Siva Shanker say. Say, yeah. So the thing is today is
about a tenant’s market. So in they are spoilt for choices, when it comes to the kind of property
or the unit they can rent, right? Which is right. They say it’s
a low entry cost or mobility. That is the easiness of moving. I mean, after your tenancy agreement actually
ended up and you would try to increase, imagine you’re a property investor
playing the property investment game, your title, increase your tenants rental after their
tenancy agreement actually mature and then you say I’m going to
increase your 20% and they say, sorry we are going to move
it somewhere else. Right. So that actually what keeps a lot of
property investors stuck or landlord actually stuck because they are stuck
with not not able to raise the rent because there’s over supply in the
market. So a lot of people say, yeah rental actually goes up by inflation. Actually it’s not true because due to
this situation it’s a law of supply and demand. Okay. And I would really want to actually also
tell you about this is that a lot of what all lay men on Tom, Dick and Harry, you know on the street or what they
only see is the buy process for property investment. Right. What we see is the, the the process or the scenario whereby
a lot of people are already having problem when it comes to property
investment, whether they cannot sell. I mean the mortgage repayment is actually
dragging them down and then they, you know, they feel that they are going
bankrupt is straining on the finances. These are the situations
we see at the back end. But actually this situation I’m not talk
about even mentioned when you go to any property gurus seminars or
courses and that is the problem, you have to know that this is
the reality of the situation. I’m talking about the two
opposite sides of the coin, but most people only want to see one side
of the coin but not the other side of the coin. So as you can see,
this law of supply and demand, if this problem is further compounded, is further worsen by the fact that
this property investor or a speculator, when they actually, you know, by then if there’s no money down technique
or strategy, just bear in mind, okay, you could be happy for one year, but then your Loan that comes with the
property investment actually stretch out to 20, 30 years. And this mentor is worsened
when people uh, you know, uh, a few years back, they
try to do a lot of this, multiple loan submission or
loan compression and they
buy multiple units of the same project or the same building on
the same condo or the same apartment. And that actually what kills
a lot of people, right? Cash back is really not free. It is you have this amount of
money but in your bank account, because there’s this cash back, I know when our cash rebate revenue
applied this loan compression technique. Now I don’t really highly recommend,
I don’t actually let me retract that. I Dont, I Dont one, anyone that
actually go into this huge debt, a loan compression and all
that, but you have to um, uh, really understand what is loan
compression and how then get it. You could be, now I also
have another lesson on that. On loan compression you can check out
what’s popping up in the upper right hand corner. I’ve covered very extensive or what are
the implication of a loan compression, what it is and all that. And if you
check out the description below, I could even link you to a situation
where a group of property bought purchased property investor or speculator.
They think they are so smart. They bought some property by idea a
this property guru and then after a few years they are stuck and then they
actually go to try a go and try to find an auctioneer, a licensed auctioneer
to solve their problems. But the licensed auctioneer, as you
can see in this new space, they say, sorry Even, I cannot help you. All right, so they had no where to go and you think
property guru are going to help you when you encounter this kind of issue
after you bought? NO! property guru. We’ve seen so many cases, people actually relate their tales to us
of what they think property guru is and then after the engage shame, after you
know the deal is done, the property guru, anything happened, the property guru
just washing their heads, right? This is the thing that
you need to understand. And further what this Siva Shanker, I say is that I know if you’re a property
investor is not really all fine and then, then you still have to manage
tenant. It’s not free money really. It’s not really passive incomes, right? But you know that there’s new
development coming on stream, then you will draw away potential tenant. And if you’re looking
at these, uh, terrace, Siva Shanker actually advise
you rather than playing in a, in a property kind of a environment where
the supply, where the overhang hang, or the ADI or what supply in a property
units actually focus on the smaller kind of square fit units like studio
apartment, my 600 square feet, 1000. So if you really want
to invest in property, here’s a tip for you
according to Siva Shanker. And because you don’t really
want to invest into this, this kind of apartment because there isn’t
really a over supply over here, okay? Because it is called a smaller unit. So if you really want to purchase property
he further said that you should go for terrace or semi-D houses, which are still popular and
generally easier to sell, right? Or buy as I mentioned, as he mentioned by large
so-called large size, uh, apartment units. So this is what not to do and what are
the things that you should do going forward? Right. And again, this is coming from a veteran in
this property investment industry, but it’s not a property guru. But
still, I would really take his advice. don’t buy his 10 property in the
same condo. Right. As I mentioned, he said location is important,
but it’s not everything. So a lot of people who use this loan
compression technique or through bulk purchase by probably guru, they always want to buy like two or three
unit in the same project or the same conduct. He say, no, don’t do that.
Right? Don’t follow the crowd. Right? Don’t follow the crowd. Don’t put
all your eggs in one basket. Right. Even though it’s GRADE A, as
preached by some Property Gurus. You don’t really want to do
that. Right. So to wrap this up, what can really kill you is that you
do not want to be greedy as they are NO quick riches a lot
people get into property. Investment game is because the
mindset, the mindset, it attracts. A lot of people want to get rich
quick and they hate their job. They want to get rich quick. That
is not going to get you rich quick. They’re gonna to kill you even faster
because probably the marathon is only for people who actually adopt a longterm
play. They have enough cash flow. They actually have a stable
career. They love the job, they love what they are doing. Yes, then you can jump into this property
investing game, right? No quick riches, but ironically it actually attracts a
lot of people who with the mindset of get rich quick because, property
have this leverage. Okay, you can borrow money and you
can use loan compression, which I really think it
should be outlawed. All right. Now it’s very funny because when
people say that they believe property investing, you get into the game because
they think property is longterm. Now, this is really when I was engaging some
of my, I’m always someone like you, my YouTube subscriber, you know, someone actually drop a
comment would say that um, in previous property
investment and listened to it, I may say the whole presentation, you think it’s flawed and he disagreed
with what I say on you know a lot of things about property investment, right? And say people who buy don’t care about
the price of the house in 30 years and people who buy for investment will
be renting out over 30 years? Okay, getting the tenant to pay the
interest so it’s a solid profit. If you sell it 3 decades later.
Now he was so convinced, you know, so convinced me. Someone dropped me this comment other
watching one of my previous video. But then I say that I really want to
understand what my YouTube subscribers are you where they are coming from
your, where you have this comment. I mean he’s okay. Do this a
week. What I say if you disagree, just leave a comment below.
I really appreciate also
even give it a LIKE so far. If you really enjoy this and subscribe
as well, right? So you’ll get, uh, very insightful lessons like this. So I tried to understand where it’s
coming from, but he say he just like, you know, have a generalization to say property on
the global market was always on the way up. Right? So for every
property investor I know, regardless of where they are in the
world, they are rich millionaires. So I doubt – he really knows what a true millionaire
does and he just actually read this from news, which you and I actually can read
because it’s a fight for everybody. Master. I know he’s probably
referring to celebrities and tycoons. I know that the problem is the problem
that a lot of people have a perception of this. Rich people actually
make money using property. No, they actually make money
using their business. That would be the best investment.
It just that they have. extra cash and they park of
this money into their property, into a lot of the large
property portfolio. Now you might be skeptical
what they say, I say, but here’s another snippet of video I
want to show you that actually further highlight this point. Business is the number on wealth creation
vehicle in the history of the fucking world or business because it is the
only asset on the planet that has what’s called a variable value proposition.
Meaning if you buy a property, you can only ever increase the value of
that property based on what the market is willing to pay. Does this make sense? A business has exponential value because
businesses value is determined by its cashflow, not the market. Here it is, the wealthiest people in this country
have not made their money through property. The wealthiest people in this country
park their money in property once they’ve made it in their business. And the more cashflow you
can produce in the business, the more valuable that business your job. But what a lot of people
do is they’ve got the bar. I’ve got invested property
cause that’s how you make money. And I get every single f cents they can
out of their business and they pull it out and I put it straight into
property. And these properties, the guy in the business, he’s like sitting there
begging for f oxygen to grow, but they don’t have any because you’re
sucking all the oxygen out and fitting into this five f things. Sit on a f [inaudible]. That’s the truth. You want to
get wealthy in this country, f invest in your business, put
the money into your business. That’s how money is made.
That’s how real money is. Mine. Yes. The also a thing, and this is where people
actually contradict themselves. So you see that when you say that property
is a longterm play, right? But after, you know, you’re in a
string of conversation, I want to understand more where
he’s coming from right. And um, he finally admitted to say, say the property investment is for
my daughter who are just turning 20. So they did Whoa. Someone
who just turned to 20, hardly even graduated from
the university. And you want. I mean, it’s good to actually start
your children on a path of investment. But I don’t want any parents to
actually give a huge debt burden on your children despite the fact
they say property. Uh, it’s actually a good
investment. But I really don’t. I mean if our parents with the put that
burden on me when I am 20 I would have freaked out. Right. But
he finally admitted, they say that despite the fact he actually
contradict himself despite the fact he say their this for a long time. [inaudible] but the reason why he went
to get into property investment is because you want to have a
quick turn around you see here. So he’s in his 60 you know, he, because he’s had a good run in a property
investment but so that’s why he say I wanted the same for my daughter as
well. Sorry I seem quick turn around. Do you mean like flipping a property.
Let’s say if you buy this year, you flip it two years
later he said no in the UK, you cannot obviously this person do not
have a perspective or what’s happening in Malaysia. Right. But you say in the UK, flipping property means
two to three months. So you buy a property today in three
months time, you’re going to flip it. I mean I really am curious what kind of
property invest in property ownership law? Are there? Uh, is there no taxation?
How about your property gain tax? Can you actually do that? So when
in Malaysia they say you flip it, it’s about two or three
or three years, right? You flip it like property speculator
in UK you could do it in three months. My God. So you see people with this kind of
mindset who want to get rich quick and who want to speculate. And I think maybe
in UK, right among this kind of a, a flipping every like
three months of flipping. I just imagine [inaudible] this is why
it’s so hard to actually own a property in your case because you, I get the price are artificially driven
up it a lot of speculator just like someone who’s intending to do
this. Now, here’s the thing, I, I really love. If you leave a comment,
I mean even if you disagree with me, you want to give me a dislike and then
you want me to give me a thumbs down. Perfectly fine. I read every comment including comments
from trolls when I put out something like that and they gave me a middle
finger or something like that. Or even, or even they say, I’m total BS
and all that. But for some of you, I know that this guy to help you.
So that made me say I’m CF Lieu. And if you would like this
kit on subscribe, click on
LIKE, give me a thumbs up. And I mean I have another lesson before
we read for today and that property, I know if you are just a beginner, a
newbie in property investment game, so you might want to watch this lesson
first poppingin the upper right hand corner, it is the property.
The method is PRRR method in property investment. This is a very simplified version
of how a longterm property play. You should adopt that being.
Say, uh, I have, uh, another, uh, earlier I say about a proxy for a
property investment as alternative asset class. If I actually get into a
huge debt for property investing, but still you’re exposed to commercial
property investment and you may in the, we’ll give you a lot of flexibility.
There’s no tenancy hassle and all that. So a lot of our students are actually
they benefit from this lesson. I said one of the most of watch lessons
videos in this channel went to check out that at the screen after these lessons. And so this is CF Lieu and I
will see you in another lesson.

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