Useful tips for those wishing to spend some money on properties in Malaysia.
Three biggest errors people make when investing in properties
“You cannot make money buying properties in Malaysia!” exclaimed a relatively disgruntled investor from Singapore. It was a statement made when we made a visit to our neighboring country. We were in Singapore in collaboration with Malaysian Property Incorporated (MPI) to promote real estate investment in Malaysia.
We ended up having a meal with the gentleman and listening to his experience of investing in properties in Malaysia. To my surprise, he was an extremely well informed person with amicable knowledge of investments and had invested in other countries as well. However, his ventures have had somewhat mixed results. Some turned out mediocre results, some incurred losses and some were profitable ventures. He concluded saying: “Nothing beats investing in your own country”.
His story is not uncommon. I have had similar encounters with many foreign investors - both in Malaysia and abroad. After some research, I realised there were some fundamental errors that most investors made when they ventured into unknown territories or countries. I would like to share three of the most common errors made by foreign (and even some local) investors.
1st common error: To FLIP or to KEEP?The first common mistake most investors committed is to invest without figuring out who their target market is.
First things first. Are you investing to FLIP or to KEEP? What’s flipping or keeping? Well, flipping is buying with the intention to sell with profit. Keeping is buying with the intention of profiting from renting the property out.
Properties for flipping are usually the ones with has the highest capital appreciation in the shortest amount of time. These are usually the landed properties......
2nd common error: Not getting to know the area well.
“I bought into an apartment in the city center (worth RM1.8mil) three years back and I couldn’t sell it out till today!” claimed the Singaporean investor. “Who were you planning to sell it to?” I asked then. “Anyone la!” he replied.
If you go around with a strategy like that, you might end up including the super natural market as well! Look, if you don’t know who you are going to sell or rent your properties out to, why buy it in the first place?
You should know your target market very well before even investing into real estate in the area. Understand what the market needs, and what it is lack of.
My advice for both locals and foreigners investing in Malaysia is to make the effort to visit the places of interest for you over and over again. Study the market and get to know the locals before you finally make the decision to invest.
3rd common error: Not understanding the localsHow many of you would invest into a RM14.5mil condominium near the city center with the intention to rent? How many of you would invest RM10.5mil for 1,250 sq ft of retail space in a new retail mall in Dengkil? While there may be some sane reasons to do so, majority would agree that you wouldn’t do either one of the deals.
Some investors lose money because of this error - not understanding the lifestyle of the locals. You should always study the lifestyle of the locals.
by Michael Tan
Full article from this website:
http://www.starproperty.my/PropertyGuide/Finance/12111/0/0
Three biggest errors people make when investing in properties
“You cannot make money buying properties in Malaysia!” exclaimed a relatively disgruntled investor from Singapore. It was a statement made when we made a visit to our neighboring country. We were in Singapore in collaboration with Malaysian Property Incorporated (MPI) to promote real estate investment in Malaysia.
We ended up having a meal with the gentleman and listening to his experience of investing in properties in Malaysia. To my surprise, he was an extremely well informed person with amicable knowledge of investments and had invested in other countries as well. However, his ventures have had somewhat mixed results. Some turned out mediocre results, some incurred losses and some were profitable ventures. He concluded saying: “Nothing beats investing in your own country”.
His story is not uncommon. I have had similar encounters with many foreign investors - both in Malaysia and abroad. After some research, I realised there were some fundamental errors that most investors made when they ventured into unknown territories or countries. I would like to share three of the most common errors made by foreign (and even some local) investors.
1st common error: To FLIP or to KEEP?The first common mistake most investors committed is to invest without figuring out who their target market is.
First things first. Are you investing to FLIP or to KEEP? What’s flipping or keeping? Well, flipping is buying with the intention to sell with profit. Keeping is buying with the intention of profiting from renting the property out.
Properties for flipping are usually the ones with has the highest capital appreciation in the shortest amount of time. These are usually the landed properties......
2nd common error: Not getting to know the area well.
“I bought into an apartment in the city center (worth RM1.8mil) three years back and I couldn’t sell it out till today!” claimed the Singaporean investor. “Who were you planning to sell it to?” I asked then. “Anyone la!” he replied.
If you go around with a strategy like that, you might end up including the super natural market as well! Look, if you don’t know who you are going to sell or rent your properties out to, why buy it in the first place?
You should know your target market very well before even investing into real estate in the area. Understand what the market needs, and what it is lack of.
My advice for both locals and foreigners investing in Malaysia is to make the effort to visit the places of interest for you over and over again. Study the market and get to know the locals before you finally make the decision to invest.
3rd common error: Not understanding the localsHow many of you would invest into a RM14.5mil condominium near the city center with the intention to rent? How many of you would invest RM10.5mil for 1,250 sq ft of retail space in a new retail mall in Dengkil? While there may be some sane reasons to do so, majority would agree that you wouldn’t do either one of the deals.
Some investors lose money because of this error - not understanding the lifestyle of the locals. You should always study the lifestyle of the locals.
by Michael Tan
Full article from this website:
http://www.starproperty.my/PropertyGuide/Finance/12111/0/0
