Property News

[mpan12]

For sake of arguments.. since it is still holiday mood now.

I will tell you if you are right or wrong (of course to my own standard which is very low compared to the gurus and milan doshis' out there)

What are your parameters as the basis of your analysis? Don't give me the general over supplies, Chinese buyers and bank loans restrictions..To analyse, you got to be deeper than that. What are the sub sectors? What are the underlying factors that influence these sub sectors. How can they be resolved or if they can be resolved. What are the long term views and historical reasons to it. The demographics of the buyers and the sentiments of non buyers, local, locally foreign Singaporeans and foreigners.
And how do you strategise the way to go around these problems or solutions. Time frame and the reasons why it is within this time frame. And all these are just for the investors.

Shall we go on to analyse the developers now? And how about the financiers. Then the Government policies and politics? Iskandar has Royal inputs in its developments. What are the consequences? Then the topographies...and the list goes on. Oh...I forgot about geo political as well and oil prices. Economic factors too.

To do all the above, I need at least 1 year to do all the research. And since it is dynamic in nature, the analysis keep changing. By the time it is completed, all properties cycles had crashed or had shot up. I would have missed my opportunity.

But maybe some of you gurs are better. You can type all the above within 10 minutes and post them immediately. I rest my case.

I rather rely on my acumen or what you called "gut feeling". Happy New Year.

The general oversupply (a very big issue already), rich Chinese/foreign buyers and bank warnings/restrictions are easy to understand for the layman. That's what the discussions have thus far been centred on.

The questions you asked are detailed but there are no firm answers or convincing direction from the Malaysian side. So how do I answer them? I don't think any good analysts can do so. Isn't it scary?!

Let's face it. The Malaysian government is not like SG government. In Singapore, everything is so transparent. If a project is said to complete by a certain year, right down to a certain month, it is likely so. At most + or - a few weeks or months delay. We don't have confidence like that in Malaysia generally, much less in a place like JB or Iskandar, be it Puteri Harbour, Medini or Danga Bay.

As many here like to often say "If so and so millionaire or big developer has gone into Iskandar to invest, it can't go wrong", well take it from BILLIONAIRE Peter Lim then. He ditched his plan to build residential properties and now convert the land to build a hospital instead. Why? Is he dumb? I don't think so. It says a lot, doesn't it?

What we do have are facts on buyer profiles, number of properties to be built or have completed in Iskandar, property prices in JB, the business projects in Iskandar, historical data on the Malaysian economy, weak currency exchange rate, political instability, etc. There are also quantitative data produced by researchers. These are not lies. They are facts. Go do your homework if you are interested. With them, you can already form your own opinions about whether it's safe or wise to invest in Iskandar.

So far, those who support Iskandar projects have never come face to face with the oversupply problem. Why? Are they choosing to ignore the fact or simply don't want to think about it? How are your condos going to be rented out next time when you are fighting with more than 10,000 others who are also renting out their units? At what price? Are there buyers who will be interested to buy your home next time? At what price?

People are so engrossed with associating Iskandar with Singapore's success. Which is so wrong. Even Ryan Khoo does that. He even went so far to say Iskandar will succeed because only a small portion of Singaporean households need to move over and it will thrive. I don't know where this 'snake oil" salesman get such assumptions from. I can also say if we all love one another, we can all have world peace! Hahaha...

You said you choose to trust your "gut instinct" because the money is yours and that is your personal decision. But no one will follow that as it is biased. We have to make intelligent decisions based on facts and data. In all likelihood, I think you have excess money or money that you don't need that's why you dare to put it in Iskandar. But for the astute investor or commoner, they will not or may not have the capability to just throw money like that.

 

[xebay11]

https://www.drwealth.com/2014/12/26/iskandar-malaysia-going-one-way-down/

Just like the California Gold Rush of 1849, investors in Singapore have been flocking in droves in the past three years to the region of Iskandar Malaysia to purchase property. Now, the party is over and the fat lady is clearing her throat.

Last updated: 26 May 2015

—

In the past four years, it seemed like nothing could stop the Iskandar train. Malaysia’s richest man Robert Kuok, Australian billionaire Lang Walker, Valencia’s adopted son Peter Lim, and a host of other big players had invested huge sums of money in the region.

Kuok had purchased S$74 million worth of land in 2013 for a mixed-development project. Walker had bet more than a billion dollars on Iskandar Malaysia becoming a boomtown, constructing the “largest master-planned urban project ever undertaken in Southeast Asia”. As for Lim, his considerable influence can be felt everywhere in the area that’s roughly three times the size of Singapore. The businessman and friend of the Sultan of Johor has his fingers in many Iskandar Malaysia-baked pies, including a premium security business, a medical hub, and the motorsports city.

It’s no wonder that many Singaporean investors have made a play in the region in the past half a decade, snapping up properties the moment they become available, eagerly anticipating the welcome flood of talents looking for a job and a place to stay. Unfortunately though, the supposed flood is turning out to be a trickle and the weather forecast is only promising more doom and gloom in the near future.

Too Many Investors, Too Little Inhabitants

When you drive around Iskandar Malaysia, it’s not uncommon to see swathes of empty apartments with no one living inside. Therein lies perhaps the main issue with the region – the lack of a critical mass of people, especially locals, staying in the area.

In the beginning, the majority of property purchases were made by foreigners, particularly Singaporeans, who were seduced by the attractive price tags. After all, we are used to paying princely six-figure sums for a shoebox, so owning a house a few times bigger than our HDB flats for a cheaper price is incredibly enticing.

Unfortunately, the property cooling measures announced in Malaysia’s 2014 Budget have thrown a spanner in the plans of many of these potential investors. Since the beginning of the year, foreigners can only purchase property worth at least RM1 million, have to pay more in Real Property Gains Tax, and must contend with a 2 percent property levy. These moves have whittled the number of potential property investors in Iskandar.

Couple this with the glut of housing development projects being launched by big Chinese developers such as Country Garden and Guangzhou R&F and you’re looking at the classic problem of unchecked growth – supply outrunning demand.

It’s a problem occurring not just in Iskandar but all across Malaysia. A 2014 Property Industry Survey conducted in the first half of the year by the Real Estate and Housing Developers’ Association Malaysia makes for depressing reading.
•Less than half of the 10,189 units launched in the first half of 2014 were sold
•90 percent of developers in Malaysia experienced a slowdown in property sales
•More than half of local buyers had problems getting financing for property purchases

If Malaysians already have issues trying to buy homes that cost below RM1 million, it’s even less likely that they would be able to afford the high-end properties in Iskandar. At the moment, the resale market is practically non-existent.

In Iskandar, purchase bookings have been reportedly down at least 20 percent and the outlook for 2015 is just as pessimistic.

Too Many Empty Houses, Too Little Businesses

A thriving business and social hub requires a careful mix of houses and businesses. The equation seems simple on paper – investments create jobs, jobs attract workers, workers need a place to stay. Reality, however, is far more complicated and the master planners and authorities in Iskandar are only starting to realise how difficult it can be.

Iskandar Malaysia doesn't have a good mix of houses and businesses, unlike thriving cities

A disproportionate amount of investments has been poured into housing while forays into businesses have been lagging behind. The only industry keeping pace so far is manufacturing. With many housing projects set to be complete in the next few years, analysts are wondering whether there will be enough rental demand from incoming workers to fill up these completed homes. If there aren’t, current property owners will be fighting over scraps and it’s a race to the bottom of the barrel.

What makes the situation difficult to read is the lack of transparency from the Iskandar Regional Development Authority (IRDA), who only releases quarterly figures on monetary investment but not job creation or population growth. The only projection is that Iskandar Malaysia is estimated to have 3.17 million people by 2025, of which 66 percent is of working age.

The rest is anyone’s guess.

Too Little Information, Too Many Possible Vagaries

Former Minister Mentor Lee Kuan Yew once said in his book One Man’s View of the World: “Let’s wait and see how Iskandar develops. This is an economic field of cooperation in which, you must remember, we are putting investments on Malaysian soil. And at the stroke of a pen, they can take it over.”

His words are beginning to ring true, with the new property measures instituted this year. Previously, property developers were rolling out the red carpet for buyers – Country Garden even chartered several buses to bring hundreds of interested investors to the carnival launch of their new properties. Today, the party atmosphere is gone.

The business dealings by the Sultan of Johor in the Iskandar region, notably the sale of 116 acres of prime land to Chinese developers Guangzhou R&F for RM4.5 billion, have ruffled a few feathers. Smaller local developers are being squeezed out of the market thanks to a new bill that gave the monarch sweeping executive powers and sentiments on the ground have been unfavourable of late.

The suspension of Forest City, a mixed-use development on four reclaimed lands, since the middle of 2014 has also been a big blow.

In a move that stunned property experts, one of the biggest developers in Malaysia, UEM Sunrise, has suddenly stopped plans to build the huge Asian Trade Centre development in Iskandar, despite announcing just last December that it was in the midst of getting approvals from the relevant authorities for the project. The first phase of the development — a mall “even larger than Pavilion in Kuala Lumpur” — was supposed to have been a catalyst to attract foreign investors. Clearly, those plans have bitten the dust.

Rocky politics, lack of comprehensive information, and more pull-outs from big players will only further shake investor confidence, evidenced by the slowdown of growth in the Iskandar region.

Is Iskandar Too Big to Fail?

Is Iskandar Malaysia too big to fail?

There is one thing going for Iskandar –the personal involvement of the Sultan of Johor. If the wheels on the Iskandar Malaysia train does fall of, it reflects badly on the king, who has already put so much time and money into the project. There is also close to RM150 billion worth of investments from influential people in the region, which is a huge sum of money to just go to waste.

The Kuala Lumpur-Singapore High Speed Rail project, slated to be completed by 2020, might also be a catalyst for growth in Iskandar since one of the proposed stops is in Nusajaya, which is within the Iskandar Malaysia region. That, however, is still far off into the future.

If you’re thinking about buying a house in Iskandar to stay in during the weekends and the holidays, you have a wealth of places to choose from right now. However, if you’re considering investing in Iskandar Malaysia, do so with caution, due diligence, and with an exit strategy, if any, that is at least two decades down the road. The train is definitely slowing down. Whether it’s permanently stopping remains to be seen.

Tekkun, this article is written for you, right up to the part of the Sultan's involvement in Iskandar.

 

[RedsYNWA]

Yah yah, based on mpan12's analysis, JB property market will crash soon by 20-50%. If not in 2016, it will be 2017, 2018, 2019, 2020, 2021.

Notice that I am leaving out 2022 deliberately.

 

[xebay11]

Yah yah, based on mpan12's analysis, JB property market will crash soon by 20-50%. If not in 2016, it will be 2017, 2018, 2019, 2020, 2021.

Notice that I am leaving out 2022 deliberately.

Already explained why, do you not understand why he wrote that? Nothing to do with the analysis but due to ill planning of completion dates, so please engage this topic intelligently, whatever it is the direction is down and probably next two decades if you want to be more precise.

 

[RedsYNWA]

Already explained why, do you not understand why he wrote that? Nothing to do with the analysis but due to ill planning of completion dates, so please engage this topic intelligently, whatever it is the direction is down and probably next two decades if you want to be more precise.

Yes I already agree it's going down mah. Anyway, 2016 is soon upon us. Let's see if the JB property will crash by 20% or not, in 2016 and 2017 lor.....

 

[Tekkun]

The general oversupply (a very big issue already), rich Chinese/foreign buyers and bank warnings/restrictions are easy to understand for the layman. That's what the discussions have thus far been centred on.

The questions you asked are detailed but there are no firm answers or convincing direction from the Malaysian side. So how do I answer them? I don't think any good analysts can do so. Isn't it scary?!

Let's face it. The Malaysian government is not like SG government. In Singapore, everything is so transparent. If a project is said to complete by a certain year, right down to a certain month, it is likely so. At most + or - a few weeks or months delay. We don't have confidence like that in Malaysia generally, much less in a place like JB or Iskandar, be it Puteri Harbour, Medini or Danga Bay.

As many here like to often say "If so and so millionaire or big developer has gone into Iskandar to invest, it can't go wrong", well take it from BILLIONAIRE Peter Lim then. He ditched his plan to build residential properties and now convert the land to build a hospital instead. Why? Is he dumb? I don't think so. It says a lot, doesn't it?

What we do have are facts on buyer profiles, number of properties to be built or have completed in Iskandar, property prices in JB, the business projects in Iskandar, historical data on the Malaysian economy, weak currency exchange rate, political instability, etc. There are also quantitative data produced by researchers. These are not lies. They are facts. Go do your homework if you are interested. With them, you can already form your own opinions about whether it's safe or wise to invest in Iskandar.

So far, those who support Iskandar projects have never come face to face with the oversupply problem. Why? Are they choosing to ignore the fact or simply don't want to think about it? How are your condos going to be rented out next time when you are fighting with more than 10,000 others who are also renting out their units? At what price? Are there buyers who will be interested to buy your home next time? At what price?

People are so engrossed with associating Iskandar with Singapore's success. Which is so wrong. Even Ryan Khoo does that. He even went so far to say Iskandar will succeed because only a small portion of Singaporean households need to move over and it will thrive. I don't know where this 'snake oil" salesman get such assumptions from. I can also say if we all love one another, we can all have world peace! Hahaha...

You said you choose to trust your "gut instinct" because the money is yours and that is your personal decision. But no one will follow that as it is biased. We have to make intelligent decisions based on facts and data. In all likelihood, I think you have excess money or money that you don't need that's why you dare to put it in Iskandar. But for the astute investor or commoner, they will not or may not have the capability to just throw money like that.

Thank you for the version of your analysis. I now know where you stand. It is true to a certain extent but not absolute.
I hope the readers here do know the other sides of coin of what I am also highlighting and not blindly follow what is being preached.

My honest opinion here. If anyone who like to invest regardless of where it is anywhere in the world, please please choose the best unit in the best location. Otherwise just walk away. And very very important is visit the site. If one is not even prepared to do these simple things, then might as well don't buy. These are the things we can control. What we cannot control is beyond our means. But what we can control is do not dive in blindly just because your friend's neighbour's auntie bought it and sure win type of mentality. It is as good as odds or even at Genting.

No, I do not throw my money easily. I buy for a purpose and not even as an investment. No plans to rent it out. Excess money, I rather have it locked in those SG Bonds. Today the money is there, tomorrow the money is still there. That's my frugal concept.

 

[mpan12]

Yah yah, based on mpan12's analysis, JB property market will crash soon by 20-50%. If not in 2016, it will be 2017, 2018, 2019, 2020, 2021.

Notice that I am leaving out 2022 deliberately.

Wah lao eh... I'm trying to talk serious and discuss the issue intelligently but you make the whole thing sound like a joke.

I didn't say specifically that JB property market will crash by 20-50%. (Hmmm... but since you mentioned it, there's a possibility.) What I did mention was that, we could see a catastrophic drop in Iskandar property prices, come 2017 or 2018. That's when thousands of new properties flood the market. I'm wondering what sort of businesses will be there by then for people to want to stay there and rent from you. Can you please enlighten me on that? Cos seriously, I've been searching for answers but I can't find them.

Several things could happen: Many spots could be ulu ghost towns, we may see owners abandon their properties, default their bank loans, property prices could plunge further. And this won't be just 2017 or 2018. It could go on for many years after that. It could also be gradually dropping after 2020 as long as buyers have the holding power until they realize they are holding onto ticking time bombs that slowly eat their money away.

Amusing how Malaysian property agents will have you believe that come 2018, demand for Iskandar properties will pick up again. I once asked this well-known Malaysian property adviser on what basis he is saying that but he couldn't even reply me. Haha....

If you have already bought a home there, well just keep it then. I don't know what you will do with it. Brave the jams every weekend to go up to your condo and face the murky water and overcast sky and pretend you're on Sentosa? But don't dispute the pessimistic but true facts surrounding Iskandar unless you can show concrete data why it will boom.

I think Mall of Medini is completed. Heard it was a flop. Gleneagles? Little news. Don't see tons of Singaporeans going there. Legoland? Expensive place mainly for foreign tourists. Pinewood Studios? I don't even know what they do there. Universities? Look like dead areas. Never heard of them booming or attracting students from here. I don't know who go there. So what Iskandar are we talking about here? Just some flashy glossy fairy tale brochures with nice blue skies and water to "scam" foreigners like unsuspecting Singaporeans to buy properties there.

 

[potter]

Johor got tigers;Please stay away. :p

 

[Tekkun]

Johor got tigers;Please stay away. :p

Johor also got rapists. Guys please stay away.

 

[cybermad]

Wah lao eh... I'm trying to talk serious and discuss the issue intelligently but you make the whole thing sound like a joke.

I didn't say specifically that JB property market will crash by 20-50%. (Hmmm... but since you mentioned it, there's a possibility.) What I did mention was that, we could see a catastrophic drop in Iskandar property prices, come 2017 or 2018. That's when thousands of new properties flood the market. I'm wondering what sort of businesses will be there by then for people to want to stay there and rent from you. Can you please enlighten me on that? Cos seriously, I've been searching for answers but I can't find them.

Several things could happen: Many spots could be ulu ghost towns, we may see owners abandon their properties, default their bank loans, property prices could plunge further. And this won't be just 2017 or 2018. It could go on for many years after that. It could also be gradually dropping after 2020 as long as buyers have the holding power until they realize they are holding onto ticking time bombs that slowly eat their money away.

Amusing how Malaysian property agents will have you believe that come 2018, demand for Iskandar properties will pick up again. I once asked this well-known Malaysian property adviser on what basis he is saying that but he couldn't even reply me. Haha....

If you have already bought a home there, well just keep it then. I don't know what you will do with it. Brave the jams every weekend to go up to your condo and face the murky water and overcast sky and pretend you're on Sentosa? But don't dispute the pessimistic but true facts surrounding Iskandar unless you can show concrete data why it will boom.

I think Mall of Medini is completed. Heard it was a flop. Gleneagles? Little news. Don't see tons of Singaporeans going there. Legoland? Expensive place mainly for foreign tourists. Pinewood Studios? I don't even know what they do there. Universities? Look like dead areas. Never heard of them booming or attracting students from here. I don't know who go there. So what Iskandar are we talking about here? Just some flashy glossy fairy tale brochures with nice blue skies and water to "scam" foreigners like unsuspecting Singaporeans to buy properties there.

I see many "coulds" in your statements but have u ever consider that if the RTS or HSR are built or PH link to Harborfront are operational , ppty "could" also boom ? So many other positive 'coulds" can happen too so why then choose only the negative "coulds" ?

u seriuosly think medini mall can bloom now when medini is still in infancy ? Gleneagles just open last month so what tonnes of pple u expect ? Legoland a foreigner place no good ?? Pinewood got some international filming gg on. search Marco Polo. Malborough college ran out of space and is asking for more land and u think its so easy to hv attracted so many top uni to come ?

 

[RedsYNWA]

Wah lao eh... I'm trying to talk serious and discuss the issue intelligently but you make the whole thing sound like a joke.

I didn't say specifically that JB property market will crash by 20-50%. (Hmmm... but since you mentioned it, there's a possibility.) What I did mention was that, we could see a catastrophic drop in Iskandar property prices, come 2017 or 2018. That's when thousands of new properties flood the market. I'm wondering what sort of businesses will be there by then for people to want to stay there and rent from you. Can you please enlighten me on that? Cos seriously, I've been searching for answers but I can't find them.

Several things could happen: Many spots could be ulu ghost towns, we may see owners abandon their properties, default their bank loans, property prices could plunge further. And this won't be just 2017 or 2018. It could go on for many years after that. It could also be gradually dropping after 2020 as long as buyers have the holding power until they realize they are holding onto ticking time bombs that slowly eat their money away.

Amusing how Malaysian property agents will have you believe that come 2018, demand for Iskandar properties will pick up again. I once asked this well-known Malaysian property adviser on what basis he is saying that but he couldn't even reply me. Haha....

If you have already bought a home there, well just keep it then. I don't know what you will do with it. Brave the jams every weekend to go up to your condo and face the murky water and overcast sky and pretend you're on Sentosa? But don't dispute the pessimistic but true facts surrounding Iskandar unless you can show concrete data why it will boom.

I think Mall of Medini is completed. Heard it was a flop. Gleneagles? Little news. Don't see tons of Singaporeans going there. Legoland? Expensive place mainly for foreign tourists. Pinewood Studios? I don't even know what they do there. Universities? Look like dead areas. Never heard of them booming or attracting students from here. I don't know who go there. So what Iskandar are we talking about here? Just some flashy glossy fairy tale brochures with nice blue skies and water to "scam" foreigners like unsuspecting Singaporeans to buy properties there.

Humm... catastrophic drop in Johor prices from 2017 onwards? So your prediction is that Johor prices will plunge by 50% or more in 2017? That's the definition of catastrophe right? So Rm 1 million house will become RM500k in 2017, and RM700k houses will drop to Rm350K.

No harm waiting another 1-2 years to find out if your prediction will come through or not. . We can always revisit your analysis then.

 

[Frodo]

What are you talking about? Haha... We are not having Philosophy101 class here!

Where's my flaw?

It's more like you are flawed in your perspective because it is one sided.

My statement might have been flawed if there is no strong evidence that there is a high oversupply of Iskandar properties. You can easily read the reports, facts and data online. Mind you, these are not from untested sources. They are from property analysts, the banks (local and even Malaysians), the Singapore government and academics. You must be either blind or deeply delusional to avoid accepting them.

All these data did not appear back in 2013. If so, the number of buyers of Iskandar properties might be much less than now.

So, let me give you an analogy. Suppose 10 people around you tell you not to visit a food stall because the food there tastes lousy. But you insist on going there. Then you ask a man standing near the stall: "Eh, can I know if the food here is delicious?" The guy replies: "Yes, it's good!" Now I come to you and say: "Do you know he is the owner of the stall? Of course he will say it's good."

Are you stupid enough to say my reasoning is flawed and go ahead to buy the food?

Sure, we can go on and on with the philosophical argument. Oh, maybe your taste bud is different. Maybe you will like the food, unlike the rest. But such arguments are trivial.

I think I've made my point. As xebay11 put it, the above is called "vested interest". You don't read an optimistic article and go YEAH! immediately. Think harder where the source is coming from.

It's not philosophy 101, but critical thinking 101.

And I have explained where the reasoning flaw is. My perspective is not any less one sided than yours, just that we are on opposite sides.

I am not haggling with you over whether there is oversupply of condos or not. It sure looks like there is. And maybe market forces will work such that the fall in property prices will lead people to buy cheap properties and then things get heated again and the market finds its price in 2018 or so. Or maybe at that time the JB govt makes more exception for the glut and make it favourable for foreigners to buy the condos and we may see the excess supply being mopped up.

Your analysis aside, I am simply pointing out to you that a fallacy has been made if you simply discredit the claims by attacking the person. Better to discredit the claims made in a systematic way than to go for the person either by ridicule or mockery.

By the way the food analogy is flawed. Food is about personal preferences and even if you don't tell me who the person is or point out that it is owner speaking, I can still venture to try because food liking is personal to holder. 10 angmos will say durians is bad, even though the durian seller say it is maoshanwang best durian. But there is always the gungho angmo who will brave the popular comment and try for himself. Besides, hawker food does not cost as much as a property and does not involve considerations similar to buying properties!

 

[Tekkun]

So many of you guys have so many analysis but have you all ever stayed in Iskandar, Medini or Puteri Harbour b4? If no visit b4, how to talk? The "i heard"," i think" "i believe" all cannot pakai. Anyone can be a keyboard warrior to talk and analyse.

 

[FHBH12]

Why your retirement plan is good news for Iskandar Malaysia
By Ryan Khoo / Alpha Marketing, The Edge Property | December 22, 2015 10:00 AM MYT

One major trend that is highly positive for Iskandar Malaysia is Singapore’s ageing population. According to Singapore’s Department of Statistics, there will be 900,000 residents aged at least 65 by 2030 in the city-state.

This effectively creates two outcomes. The first is that Singapore, with its low birth rates and an ageing society, has to continue its policy of population growth via immigration. The old age support ratio (OASR) was 6:1 in 2014, which means there were six working adults to support each retiree in the country. By 2030, the ratio could fall to 2:1, which would be disastrous for economic productivity. A clear example of that today is Japan, where the economy has stagnated for more than two decades.

To avoid a similar fate, Singapore would have to continue pursuing population growth via immigration — thereby increasing population density on the island owing to limited land — as per the much-maligned 2013 Population White Paper, to hit a 6.9 million population by 2030. Singapore is currently the third most-densely-populated country in the world, according to a recent government statistic. Hence, the cost of space here will remain high and climb higher in the longer run, making the business case for Iskandar Malaysia stronger.

The second outcome is how Iskandar Malaysia has become an option for retirement planning for Singapore’s elderly. The median age for Singapore today is 40 years, and observations on the ground show that much of the real demand for properties in Iskandar Malaysia has been by the country’s older population. Many in this segment are sitting on cash savings of $100,000 to $200,000, yet are notable to buy a second or third property because of lower loan amounts owing to the total debt servicing ratio and additional buyer’s stamp duty for additional properties. So, buying a property in Iskandar Malaysia becomes a viable option because of the affordable pricing and the proximity to Singapore.

Property in Iskandar Malaysia can serve as a potential retirement home and an investment. Other overseas property investments will not be able to achieve both these objectives. Those who buy properties in faraway locations such as Australia or the UK cannot possibly expect to retire there unless they emigrate, thus weakening links to Singapore, and only if they can afford the higher cost of living in these countries. Iskandar remains the only practical retirement option as they can enjoy Malaysia’s lower cost of living, a bigger living space, and family ties, convenience and a sense of familiarity.

Many who buy properties in Iskandar today may not have retired yet, but are planning for when they do. With another 10 to 15 years to go before retirement, they can afford to look at the long term for Malaysian properties and not be affected by short-term market sentiments. There are several more reasons why retiring in Malaysia is attractive.

Healthcare options in Malaysia are attractive

Healthcare is one promising area for Iskandar to target as the Singapore consumer gets older, richer and better informed. Healthcare costs in Malaysia are between 30% and 50% cheaper than in Singapore and Iskandar is just an hour’s drive from most parts of the city state. The local healthcare market is also significant and growing as Malaysians living in Iskandar— many of whom work or do business with Singapore — become more affluent as well.

Private healthcare in Iskandar Malaysia is still underdeveloped, but big plans are on the cards. Gleneagles Medini, which was recently launched, is emblematic of the rapid growth in greenfield Nusajaya, located just across the famed Legoland Theme Park and Afiniti Medini, the urban wellness joint-venture project by Singapore’s Temasek and Malaysia’s Khazanah. Gleneagles Medini has a generous 15 acres of land for future expansion and immediate plans include a 17-storey tower for specialist suites.

The next highly anticipated player is billionaire Peter Lim’s Vantage Bay healthcare city in Johor Baru City Centre. Lim’s Vantage Bay mixed-development project covers 23 acres, with plans of it being a healthcare and wellness hub, and healthcare education hub. His privately owned Thomson Medical will operate the recently named Iskandariah Hospital, scheduled to open by 2018.

Other private players in the market include US-based Columbia Asia, Singapore-operated Regency Specialist Hospital and Malaysia- listed KPJ Healthcare. There are also numerous smaller operators that cater for another tier of the healthcare market — nursing homes and privately managed retirement villages.

A little known fact is that Singaporeans can use their Medisave in selected Medisave accredited hospitals in Malaysia. Today, this includes Regency Specialist Hospital in Johor Baru and Gleneagles Medini, and will likely be extended to all other privately operated hospitals in Iskandar Malaysia in the future.

Another big opportunity for healthcare in Iskandar Malaysia is healthcare tourism, with Indonesians being the largest number of medical tourists in Malaysia today. Medical tourists from the West, China and Japan are also significant. Private hospitals in Singapore’s Novena and Orchard Road do big business in this sector and as more options open up in Iskandar Malaysia, there is a large opportunity to tap into the trend. Frost & Sullivan expects healthcare expenditure in Malaysia to hit US$25 billion ($35.3 billion)by 2020, growing at 8% to 10% per annum.

High Speed Rail and Rapid Transit System will improve links

Travelling between Singapore and Iskandar Malaysia today can be a big hassle. Thousands cross the border daily, with Malaysians going into Singapore during the morning rush hour, and heading back home in hordes in the evening. Traffic jams on the Causeway and the Second Link have throttled further growth. While plans for a third bridge are unlikely to materialise anytime soon, discussions on the Rapid Transit System linking Woodlands North and Johor Baru City Centre have been going on for several years. Recently, the site for the Johor Baru RTS station was identified at Bukit Chagar, an empty plot of land that currently serves as a huge open-air carpark. With this confirmation, plans can now proceed towards detailed engineering studies.

The High Speed Rail has also seen progress, with the Malaysian government setting up MyHSR Corp, a company dedicated to building the HSR in Malaysia. Recently a Request for Information initiated by Singapore’s Land Transport Authority and Malaysia’s SPAD (Land Public Transport Commission) saw more than 150 firms responding, indicating high interest to participate in this massive infrastructure project. The location of the HSR stations for Iskandar and Singapore will be at Gerbang Nusajaya and Jurong East (Jurong Country Club) respectively.

These rail links are important as experience in other cities show that three to six times more people can be moved when such rail links are in place. For Singaporeans planning to retire in Iskandar in the future, these rail links will make it easier to travel and save a lot of travel ling time, opening up opportunities in services and the retail industry, serving the Singapore market on top of its own growing local population. Imagine the economic benefits that Iskandar will enjoy if the Singapore consumer market can be unleashed onto Johor Baru in its entirety.

Because of the proximity of both countries, Singaporeans retiring in Iskandar will not need to apply for the Malaysia My Second Home (MM2H) programme. Singaporeans currently enjoy 30 days’ visa-free entry into Malaysia. My personal experience is that with the city state so close by, retirees can easily spend one day in 30 to renew their entry documents. Living here and in Iskandar concurrently will be a reality for many, especially with the upcoming rail links linking both cities.

Puteri Harbour residential and commercial development in Nusajaya. Buildings in Singapore can be seen in the distance.
Proximity to the city state is an attraction for retirees who plan to live in Iskandar Malaysia.

Cost of living in Malaysia is significantly lower than in Singapore

Depending on which survey you refer to, living costs in Iskandar Malaysia are between two and three times cheaper than in Singapore. Again, for retirees, this is an important consideration to stretch their savings. The lower costs of food and other essentials have been well documented, so let me focus on transport.

While public transport in Malaysia is still behind Singapore’s, you can consider buying a car in Iskandar. Say, a brand new car costs about RM85,000 ($28,333) in Malaysia. You could get as high as 90% financing and up to a 10-year loan. The car is “freehold”, with no Certificate of Entitlement cost; in Singapore, it comes with only a 10-year lease. A more practical option would be to get a second-hand car; small sedans are available for between RM15,000 and RM50,000.

What is a car worth to you if you live in Iskandar? Well, it buys you freedom of movement— something quite close to priceless if you have spent years travelling via buses and MRTs in Singapore. And that is part of the draw of having an Iskandar “retirement plan” and why an ageing Singapore population is good news for the Iskandar region.

Ryan Khoo is co-founder of Singapore-based Alpha Marketing, a real estate investment consultancy that focuses on the Malaysian market, especially Iskandar Malaysia. The views expressed here are his own. He can be contacted at [email protected].

This article appeared in The Edge Property Pullout, Issue 708 (December 21, 2015) of The Edge Singapore.

http://www.theedgeproperty.com.sg/content/why-your-retirement-plan-good-news-iskandar-malaysia

 

[RedsYNWA]

So many of you guys have so many analysis but have you all ever stayed in Iskandar, Medini or Puteri Harbour b4? If no visit b4, how to talk? The "i heard"," i think" "i believe" all cannot pakai. Anyone can be a keyboard warrior to talk and analyse.

Property analysts are just like stock analysts.... In 2009, when STI was rebounding from 1,800, many 'star analysts' were proclaiming that it was a dead cat bounce, and the index was poised to go lower and lower. When STI climbed higher and higher instead for a few months, these same 'star analysts' started changing their tune, and said that the recovery was 'real and solid'.

You see examples of this every single day, especially during quarterly reporting seasons. The same stock's target price can fluctuate wildly based on quarterly results releases. 1 day, the target price can be $2.50, and another day later, it may shoot up to $4.

Same thing with Iskandar. Today the property doomsayers will be proclaiming catastrophic price drops in the near future, and when prices start climbing instead, they will change their tune to write about strong investment inflows, population growth, SG factor, HSR/RTS etc etc.

 

[Tekkun]

Property analysts are just like stock analysts.... In 2009, when STI was rebounding from 1,800, many 'star analysts' were proclaiming that it was a dead cat bounce, and the index was poised to go lower and lower. When STI climbed higher and higher instead for a few months, these same 'star analysts' started changing their tune, and said that the recovery was 'real and solid'.

You see examples of this every single day, especially during quarterly reporting seasons. The same stock's target price can fluctuate wildly based on quarterly results releases. 1 day, the target price can be $2.50, and another day later, it may shoot up to $4.

Same thing with Iskandar. Today the property doomsayers will be proclaiming catastrophic price drops in the near future, and when prices start climbing instead, they will change their tune to write about strong investment inflows, population growth, SG factor, HSR/RTS etc etc.

At least on stock market got statistics.

On Iskandar, "I heard Medini is a flop" or "Educity like dead ants" showed that the person had never been there before. Does he know how there are 6 universities there? Does he know the Reading University shifted its campus from JB 2 months ago? Or even Raffles American School? Like I said, not been there, how much does he know? With due respect, it is better to keep quiet.

 

[Relaxman]

At least on stock market got statistics.

On Iskandar, "I heard Medini is a flop" or "Educity like dead ants" showed that the person had never been there before. Does he know how there are 6 universities there? Does he know the Reading University shifted its campus from JB 2 months ago? Or even Raffles American School? Like I said, not been there, how much does he know? With due respect, it is better to keep quiet.

I heard Reading University campus is very solid and a lot of ang moh lecturers there.

 

[Tekkun]

Yup. It is in the top 1% of all universities in UK according to 2016 ranking.

 

[xebay11]

At least on stock market got statistics.

On Iskandar, "I heard Medini is a flop" or "Educity like dead ants" showed that the person had never been there before. Does he know how there are 6 universities there? Does he know the Reading University shifted its campus from JB 2 months ago? Or even Raffles American School? Like I said, not been there, how much does he know? With due respect, it is better to keep quiet.

Building every infrastructure is good, but what's the plan to attract the people? I am sure you read the article I posted this morning, it acknowledge that alot of things coming but no one to fill it up.

 

[Relaxman]

Building every infrastructure is good, but what's the plan to attract the people? I am sure you read the article I posted this morning, it acknowledge that alot of things coming but no one to fill it up.

You have a point there. One college there is the famous MDIS from singapore. I heard there are very optimistic.