Setia Sky 88 community

I don't think the investors have limited holding power or financial resources. If so, they would have slashed their prices by a lot more. Instead, we are seeing higher selling prices than they bought during launch.

Maybe most owners are just trying their luck. If they don't sell and since rental is too cheap to be considered worth it, the condos may end up as white elephants. To me, nothing could be worse than this situation because your money is stuck in a foreign country indefinitely. It's draining your finances away.

mpan12 said:

I don't think the investors have limited holding power or financial resources. If so, they would have slashed their prices by a lot more. Instead, we are seeing higher selling prices than they bought during launch.

Maybe most owners are just trying their luck. If they don't sell and since rental is too cheap to be considered worth it, the condos may end up as white elephants. To me, nothing could be worse than this situation because your money is stuck in a foreign country indefinitely. It's draining your finances away.

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You perfectly right. They may be trying their luck....and they are just in their own fantasy. The serious buyers have all the time to wait for the price to drop further.

Dear learned forummer, if we substitute Setia Sky 88 with Princess Cove, would all the analysis holds and remain the same?

Relaxman said:

You perfectly right. They may be trying their luck....and they are just in their own fantasy. The serious buyers have all the time to wait for the price to drop further.

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Need to find serious common Malaysian buyers willing to buy over. So if owners paid RM500k for their condos, I would think they need to reduce price to RM300k or below. That's at least RM200k loss and only if they are lucky enough to find buyers.

mpan12 said:

Need to find serious common Malaysian buyers willing to buy over. So if owners paid RM500k for their condos, I would think they need to reduce price to RM300k or below. That's at least RM200k loss and only if they are lucky enough to find buyers.

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Yes....but these condo owners of sky88 would not admit they have invested in the wrong property. They would rather suffer quietly and pay the bank the heavy installment than sell at a loss. Their pride at stake. Clever flippers will sell at a loss now.

Relaxman said:

Yes....but these condo owners of sky88 would not admit they have invested in the wrong property. They would rather suffer quietly and pay the bank the heavy installment than sell at a loss. Their pride at stake. Clever flippers will sell at a loss now.

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It takes courage and wisdom to identify what is a bad investment, cut loss and move on.

If it's purely for investment, then the longer one holds, the worse it may get. Holding power makes sense only if the investment is in something that has potential to turn around. One has to make an informed judgement if this is the case for Johor condos.

The problem is that even if sellers want to reduce their prices drastically, it may be impossible to find interested buyers. The market is likely to be very weak in many years to come and the oversupply is overwhelming.

That's a frightening scenario

mpan12 said:

I don't think the investors have limited holding power or financial resources. If so, they would have slashed their prices by a lot more. Instead, we are seeing higher selling prices than they bought during launch.

Maybe most owners are just trying their luck. If they don't sell and since rental is too cheap to be considered worth it, the condos may end up as white elephants. To me, nothing could be worse than this situation because your money is stuck in a foreign country indefinitely. It's draining your finances away.

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As I've said, many are just "small time investors" who went in with their eyes closed, just following the herd, believing "its now or never" (sorry not that song) and believing in getting quick bucks very soon ( maybe was kindly advised by the sales people).
Small time investors will always wanting to sell higher than their buying price, ALWAYS! (cut loss is never in their vocab)
But I wonder how many sellers actually studied the market situation or listen to their agent when they put up an offer.
Also wonder how many realized that once you put up an offer and by certain time, you do not get offers or only got that few offers that demand hefty discount, you should know your price is out.
Usually after 6 to 9 months in the market, when you still don't get a reasonable offer, you should know very well your situation.
Its time to slash price and its not just 5, 10%!

These small time investors deserve it. I could see all this miles away.

I think the worse case is the imposition of the RM1m restriction for foreigners. As most 2-room units are priced below RM1m, a lot of owners cannot sell these to the foreigners. This not only applies to Setia 88, but all other condos in JB as well. I think that going ahead, if the situation will turn so bad, their authority may consider lowering the restriction to RM500k again.

snowbird said:

As I've said, many are just "small time investors" who went in with their eyes closed, just following the herd, believing "its now or never" (sorry not that song) and believing in getting quick bucks very soon ( maybe was kindly advised by the sales people).
Small time investors will always wanting to sell higher than their buying price, ALWAYS! (cut loss is never in their vocab)
But I wonder how many sellers actually studied the market situation or listen to their agent when they put up an offer.
Also wonder how many realized that once you put up an offer and by certain time, you do not get offers or only got that few offers that demand hefty discount, you should know your price is out.
Usually after 6 to 9 months in the market, when you still don't get a reasonable offer, you should know very well your situation.
Its time to slash price and its not just 5, 10%!

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Actually, I can understand these investors' mentality. Investing in Johor properties was very tempting when the Singapore market was shut in their faces back in 2013. It's not just in the old JB. Foreigners like Singaporeans were rushing in from the eastern to western parts of Iskandar to snap up properties, especially condos.

It didn't help that the cunning agents were like vultures waiting to swoop down on innocent buyers with cash to spend, telling them lies that they could rent out their Johor condos and make money, or there is capital appreciation in future. If such investors bothers to check the truths about Johor condos, and how bad the situation is, I think they might be shivering now or have sleepless nights.

There are also speakers with sweet tongues who will paint a beautiful picture about Iskandar in those Malaysian property talks. These talks are superficial "coffeeshop uncle" standard and never go deep enough to understand the underlying problems.

Yes, my observation is that small-time investors usually don't know how to cut losses. They stay on in a bad investment and give themselves hope that things will improve. This is waiting for bigger disaster to happen. More losses will be incurred.

It's the big time investors who dare to cut losses and put their money somewhere else that can give better growth. Peter Lim is one example. He initially wanted to build residential properties in Iskandar but backed off. Even one of Malaysia's largest developers, UEM Sunrise, ditched its huge Asian Trade Centre project in Nusajaya much to the shock of many. All these are strong signs to tell us how bad the problem is.

The prices of new Johor condos sold in 2013 are not justified and had been largely marked up by more than 50%. So I think sellers now need to slash prices by 50-60% before they may get 1 or 2 potential buyers. And that's only a MAYBE!

winners said:

I think the worse case is the imposition of the RM1m restriction for foreigners. As most 2-room units are priced below RM1m, a lot of owners cannot sell these to the foreigners. This not only applies to Setia 88, but all other condos in JB as well. I think that going ahead, if the situation will turn so bad, their authority may consider lowering the restriction to RM500k again.

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Why would the Malaysian Government make it easier for foreigners to sell to foreigner?

This RM1m restriction is here to stay for good and investors should thank their lucky stars if it does not increase to RM2m.

It is interesting to re-read the old posts here and elsewhere to see how sentiments have changed. I wonder how the owners fare now. They no longer post here.

This was an old post in 2013:





I also didn't know owners of Setia Sky88 paid so much for their condos, about RM800 psf!

xebay11 said:

Why would the Malaysian Government make it easier for foreigners to sell to foreigner?

This RM1m restriction is here to stay for good and investors should thank their lucky stars if it does not increase to RM2m.

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I won't be too sure about this. Not all those 2-room owners are foreigners. Once the state government will see so many empty condos in JB and the locals may start to appeal, they may provide this reprieve. Anything is possible in Malaysia. They can always revert back to the RM1m restriction at a later date when the whole economic situation will improve, although they won't tell you when.

sgcount said:

It is interesting to re-read the old posts here and elsewhere to see how sentiments have changed. I wonder how the owners fare now. They no longer post here.

This was an old post in 2013:

I also didn't know owners of Setia Sky88 paid so much for their condos, about RM800 psf!

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These earlier posting really make me laugh until i my stomach hurts. What i can say is these earlier posting is so naive and purely self gratification.... in other word or layman term "Syiok Sendiri". Thks for sharing sgcount.

mpan12 said:

It takes courage and wisdom to identify what is a bad investment, cut loss and move on.

If it's purely for investment, then the longer one holds, the worse it may get. Holding power makes sense only if the investment is in something that has potential to turn around. One has to make an informed judgement if this is the case for Johor condos.

The problem is that even if sellers want to reduce their prices drastically, it may be impossible to find interested buyers. The market is likely to be very weak in many years to come and the oversupply is overwhelming.

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In fact is just the beginning. The real nightmare begin when these bunch of owners received their keys later because SP Setia is going to handover their pigeon holes in full of defects like what happened in other SP Setia projects like the Sky executive suites in bukit indah.

winners said:

I won't be too sure about this. Not all those 2-room owners are foreigners. Once the state government will see so many empty condos in JB and the locals may start to appeal, they may provide this reprieve. Anything is possible in Malaysia. They can always revert back to the RM1m restriction at a later date when the whole economic situation will improve, although they won't tell you when.

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I feel the state government should never use this kind of tactics to control property prices. Instead, they could restrict bank loans or use TDSR like what Singapore is doing.

When you impose a minimum sum for foreigners, you are penalizing earlier buyers for nothing. These people may need to liquidate their assets. But instead, their properties have now become a liability.

If I am a pure foreign investor, I will not be motivated to invest in Johor because I never know what sort of rules they will impose in future. They are not only preventing new properties from being sold, the market prices may not necessarily move down also for the benefit of their own Johoreans.

I don't want my money to be locked up. All those who have bought below RM1mil cannot move their money out of the country. I find this thought very scary indeed!

Relaxman said:

These earlier posting really make me laugh until i my stomach hurts. What i can say is these earlier posting is so naive and purely self gratification.... in other word or layman term "Syiok Sendiri". Thks for sharing sgcount.

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You're welcome!

They predicted things too fast and were too optimistic.

People who have bought certain things (in this case, properties) also tend to say they have made the right choice or think they are the smartest. There is a danger with such over-confidence.

More worrying is when others in the forum seek advice from these people and get dragged into the blind buying spree also.

Relaxman said:

In fact is just the beginning. The real nightmare begin when these bunch of owners received their keys later because SP Setia is going to handover their pigeon holes in full of defects like what happened in other SP Setia projects like the Sky executive suites in bukit indah.

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Oh.. I didn't know Sky Executive Suites is that bad. Saw quite a number of resale and rentals being advertised. But at least the owners bought them at RM500 psf and below? Launches after that were all priced too high. Above RM700 psf will not find many buyers now.

I remember there's another one nearby called D'Inspire. That one has really bad workmanship, and things were not what the owners had expected. Part of it was even converted into some kind of motel.

Investors of all these condos got it real bad... don't think they can easily sell their condos any more. Doubt JB locals will buy them too.

sgcount said:

You're welcome!

They predicted things too fast and were too optimistic.

People who have bought certain things (in this case, properties) also tend to say they have made the right choice or think they are the smartest. There is a danger with such over-confidence.

More worrying is when others in the forum seek advice from these people and get dragged into the blind buying spree also.

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I think earlier on, I saw there are forummers who try to give their honest view on the project but was arrogantly shot down by these "big time investor" of Sky88. They even being sarcastic and bullish about their great investment. No wonder those "big time investors" no longer keen to post in this thread anymore.