All Posts by Jimmy

What is freehold property

As the developer owns the land, property built on it facilitates the transfer of land to the buyer provided it is a landed residential property such as a bungalow or a terraced house. This ownership will be in the form of Master Title.

As for a condominium or other high-rise residential properties, the buyer owns a stake in the condo by way of the unit but the developer still owns the land. In this case, the developer will distribute the ownership via Strata Title.

Unlike leasehold, only environmental and town planning controllers limit freehold developments. Under the Land Acquisition Act 1960, the state can take back freehold land if it is for public purposes, such as an MRT project, or economic development.

For example, the federal government acquired the land which the Ampang Park Shopping Centre was built on for the MRT project. If such an acquisition occurs, the owner will be paid the market value of the property.

Freehold land certainly does have its fair share of benefits. Owners face fewer and less stringent limitations should they want to transfer their land to someone else. They also have the right to subdivide and allocate the land, although it is still subject to town planning controls.

If there is no development taking place on a freehold land, the state cannot claim the land from the owner, meaning you are not required to stick to a specific timetable.

Generally, freehold properties go through stable growth provided all other aspects of the property are in good condition. There is also the possibility of redevelopment of old freehold properties where owners will be compensated.

But there’s one thing to note here: there are freehold properties that need the consent of the state when transferring ownership. An example of “restricted” freehold properties are the semi-detached houses in Kelana Jaya. The reason for this is these properties were converted from leasehold to freehold.

Source: PropSocial

Potential buyers are advised to look at the title of the property to find out if there are any restrictions on the land before deciding to make a purchase.

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What is leasehold property

The tenant has to care for the land as defined by the land legislation and may be responsible for developing some property and maintaining it. If the state deems the tenant unfit, the security of the tenure may be compromised. The state can forfeit the lease for non-performance.

1. It takes longer to sell

During the period of ownership, unlike most freehold titles, only the state or an equivalent can grant approval for a transfer of the lease. The sale for a leasehold property takes 3 + 1 months, which only starts after the state has given consent – this can take anywhere from six months to a year. This can make reselling your property a problem in the future.
If you are purchasing a second-hand leasehold property, the paperwork for transferring ownership can take about a year or longer in Selangor and Kuala Lumpur due to the number of consent requests. It is believed that leasehold property bought on the primary market, or from a developer, usually doesn’t consume that much time.

2. Value may be lower than freehold

When it comes to value, experts observe that properties with a 99-year lease go up at a similar rate with its freehold counterparts during the first 20 to 30 years. Some leasehold properties do gain more value than freehold ones during the early years. But beyond 30 years, the values of leasehold properties stagnate and depreciate until the expiry of the lease.

3. Financing may be more difficult to obtain

There’s also the problem of financing. Financial institutions tend to not lend to those wanting to acquire leasehold properties with less than 50 years remaining on the lease. Most banks veer towards lending for leasehold properties with at least 75 years left on the lease. Even if you do get approved for financing, your margin of financing (loan amount) will likely be lower than the maximum 90%. This means you will have to fork out more cash for your down payment.

4. Value is lower than freehold

Price-wise, leasehold property may or may not be cheaper than that of a freehold of similar specifications. Assuming that all other details are equal, such as the built-up area of the building and the land size, the price of a leasehold property is often around 20% lower than a freehold one.

Source: PropSocial

Finally, there’s renewing the lease. The last thing you want is to suddenly receive a notice that your lease is expiring within a few years and to renew it you have to pay an exorbitant amount, just like what happened to the folks in PJ Old Town.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

5 Best Renovations That Add Value To Your Home

So what kind of renovations should you do to get the best bang out of your buck? Here are the top 5 renos you can consider:

kitchen

1. The Kitchen

Kitchen renovations are one of the most profitable renovations you can do with an estimated ROI between 60-120%. Don’t go over the top, keep longevity and potential buyers in mind when you’re making your renovation plans.

Look for areas in the kitchen that you can either replace or do some touching up. It could be adding a backsplash, restoring cabinets, doing up your floors or replacing counter tops, tiles and fixtures.

bathroom

2. Master Bathroom

Your bathroom renovation doesn’t have to be expensive, you just need to aim for it to come out looking modern and functional. Most contractors would recommend renovating the shower area first – build in a frameless glass stall or reglaze the good ol’ tub to make it look brand spanking new.

Other add-ons that can add value are space saving cabinets, a walk-in wardrobe and creating an en-suite bathroom if the master bedroom hasn’t got one yet. Replacing your fixtures is something you can DIY instead of hiring a handyman.

front door

3. The Front Of House

About 90% of buyers would make a decision if they’re interested based on first impressions – the outside of your house. Refresh tired looking doors with a new coat of paint or finish and do a bit of landscaping for the front garden to make your property more attractive. If you’re thinking of adding some plants to your entrance or garden, ask your landscape designer or nursery on the best planting variety for your soil and based on your availability to maintain them.

wall

4. All Your Walls

Cracked walls and peeled paint could put buyers off, or just leave them unimpressed. Repainting and restoring your walls is a quick way to make your house look new without any major renovation work provided that it’s done properly.

Fill in small gaps and as your renovation contractor to fix damaged parts. It’s a safe step to leave your walls bleach-white, but following a neutral colour palette can also increase your home’s saleability – colours like beige, white, black and grey appeal very much to buyers with a modern taste.

An electrician binding copper wires together and sealing them with insulation stripe.

5. Electrical Wiring & Plumbing

These are one of the most common requests made by home buyers. Nobody wants to move in and then find out that the lights are flickering and the water isn’t flowing well into the toilet. Do a thorough check in your house for electrical wirings and plumbing that are outdated or faulty.

Source: PropSocial

Consider if there are enough power outlets for all the rooms in the house including the ones for air conditioning.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

Rent-To-own Concept To Enable PPRT Flat Occupants To Become Property Owners

Rent to buy is a new concept of buying a house. It still a new method in Malaysia.

The Urban Wellbeing, Housing and Local Government Ministry will introduce the rent-to-own concept to enable low income earners to become property owners under the Hardcore Poor Housing Project (PPRT).

Minister Tan Sri Noh Omar, however, said the introduction of the concept, however, would take place only after getting the Cabinet’s approval.

invest money

“We proposed the concept to enable individuals earning RM2,500 or less to own their PPRT units after their loan applications were rejected due to not fulfilling bank conditions, being blacklisted or not having proper payslip to prove their financial standing.

“Maybe we can create a mechanism so that they can pay a monthly (rent)payment of RM200 within a stipulated period and once they complete the payment, they will get full ownership of their units,” he told reporters after attending the ministry’s Aidilfitri Open House here Sunday.

Meanwhile, Noh said the ministry had set aside an allocation of RM500,000 to repair the lift service at Desa Mentari low cost flats in Petaling Jaya.

“I’m so sad to learn about lift malfunctions at the 16-storey flats…I hope the allocation will be used wisely to ease the burden of the residents,” he added.

Article Source: DurianProperty

Learn this method to save money for buy new house instead rent to buy.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

Malaysian market surprisingly resilient after Brexit

The trend or the property market in Malaysia are slowing again.

KUALA LUMPUR: Markets in developing Asia have proven surprisingly resilient a month after Brexit.

A report in the Financial Times said policymakers had been appropriately cautious over the past few weeks in the face of a series of unexpected political shocks, from Brexit to the Turkish coup attempt to a series of terror attacks in Europe.

furnishing

However, in Malaysia, the FT report said, the local bond market had shaken off not only global events but also local problems, including the fact that US and Singapore regulators were taking action over fraud claims connected to 1Malaysia Development Berhad, backed by Prime Minister Najib Razak.

So far, it said, the search for yield had trumped political risk.

It said government officials, who had been worried both about the prospects for exports amid downgraded global growth forecasts and domestic demand, should be pleased.

They were pleased with Bank Negara Malaysia’s rate cut earlier this month but want further pre-emptive support to ensure stable growth momentum.

Some of the central bank’s staff think this unnecessary, since the economy looks on track to hit the official growth estimate of 4-4.5 per cent for this year.

Najib’s ability to shake off his critics so far is rooted in a strong economy and in keeping unemployment down, so the government will keep pushing for further rate cuts and this is likely to prevail before the end of the year, the FT report predicted.

In Indonesia, the central bank signalled that further interest rate cuts were possible after it held steady last Thursday, but noted that market rates have been responding to the 100 basis points worth of easing already undertaken this year.

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The report said the recent tax amnesty bill had helped improve investor sentiment.

Article Source: DurianProperty

Property Investor may take this this opportunity to do some investment.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

9 Tips For Buying Your First Home

Below are the 9 tips for buying your first home:

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1. Have enough money.

You can either get help from family (which is not advisable) or apply for a bank loan. Spend wisely and cut down on unnecessary expenditure.


2. Mortgage should not be more than 30% of your monthly income.

It is best to keep your mortgage lower than 30% of your monthly income, so that you will have enough cash for the rest of the expenditure that comes with a house. Also, you have a life to live!


3. Do not buy a suburban house with an aim to save cost.

If you are working in the city, a suburban house is a terrible choice. Imagine the hours spent on commuting to and fro to your workplace, energy wasted, traffic congestions, toll charges and petrol fees, it’s really not worth it in the long run.


4. Convenient facilities

One of the main factors to consider before purchasing your house is to ensure that the environment and facilities available suit your needs. Amenities such as convenient store, mall, restaurants, bank, kindergarten, school, clinic, hospital and post office are a must.


5. Neighbors.

It is best to form good relations with your neighbors as they are the ones closest to you. If possible, try convincing your family members and friends to buy houses that are in the same area as you.


6. Value of the house.

Even if you do intend to live in the house rather than renting it out, buy a house that guarantees a rise in value in the future.


7. School.

It is best to invest in a house that has schools around. Although it might not be necessary at the time of purchase, but it will be too late when you realize schools are too far away when you need it.


growth investor

8. Do not overspend.

Although investment is costly, it is wise to bargain for the best price and buy the house that suits your needs rather than an expensive house.


9. Security.

Ensure that the housing area is fully fenced and there are security guards patrolling consistently.

Article Source: DurianProperty

Follow the tips as a guideline to prevent mistake when buy home.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

What are the layers of personal finance success?

One of the most interesting things I’ve found over the years of working on The Simple Dollar, charting my own financial progress and changes, and talking with countless readers is that personal finance is a lot like an onion.

An onion? Yep.

It’s like an onion in that it’s made up of a bunch of layers that aren’t really very transparent. You know what’s underneath them on some level, but it takes time to really understand each level and incorporate it into your life.

Here, I’m going to summarize some of the layers of the onion so that you can get a good idea of what I’m talking about.

The First Layer: Debt Is Bad, Savings Is Good

This is the level on which many people who are really struggling with their money see their finances. They understand that debt is bad and that saving money is good, but when it comes to the things they want in their life, this seems secondary.

Isn’t it much better to just spend that money on stuff that you want? A big house? A lot of stuff to fill it? A shiny car in the driveway?

The basic ideas of personal finance – spend less than you earn, avoid debt with high interest rates, try to save some of the money you make – are actually pretty obvious. Everyone understands those ideas on some level, but they don’t put them into practice.

They don’t really see the connection between their day-to-day behavior and the mountain of debt and the lack of savings that they have.

Sure, they understand the idea, but it’s not incorporated in their life in any way. It’s like a fact that they know, not one that really matters when it comes to their behavior.

The Second Layer: Your Choices Create Both Debt and Savings

The next layer of realization is when people begin to realize that the things that they spend money on create both debt and savings.

The more money you spend on stuff, the less savings you’ll have and, if you spend too much, the more debt you’ll have. The less money you spend on stuff, the more savings you’ll have and the less debt you’ll have.

In other words, the little choices you make every day are the determining factor in whether you have debts or savings – and how much of each you have.

Whenever you buy anything, you reduce your potential savings. If you’re in debt, you effectively increase your debt, too, because that money isn’t going into savings or toward your debt.

This goes from the big purchases, like cars and so on, down to the tiniest purchases, like a bottle of soda at the gas station. Each one of those purchases – each one of those choices – has an impact.

Whenever you choose to spend – and whenever you choose to spend less or not to spend at all – you shape whether or not you have debt and whether you have savings.

Let’s peel back a little bit more.

The Third Layer: Much of the Stuff You Buy Doesn’t Create Lasting Joy

The counterargument against cutting back on non-essential purchases is that doing so removes the pleasure from life. I’m adamantly opposed to doing that. If a purchase brings genuine, lasting pleasure in your life, you shouldn’t cut it.

The catch is that the vast majority of purchases people make do not bring lasting joy. They bring a little short-term burst of pleasure, but lasting joy? It’s actually pretty rare for that to be the outcome of spending your money.

I went out for dinner last night. The dinner was good – it was pleasurable – but the pleasure of it is already fading away.

It was expensive and it didn’t create lasting joy and it won’t be long before I’ll either forget it entirely or regret the expense.

On the other hand, my most memorable meal of the last year was one where I ate with an old friend. It did create lasting joy – a meal that we still talk about that reconnected me to an old friend.

If you’re going to spend money on something that isn’t essential, why not spend it on something that has a very high chance of creating lasting joy in your life?

For me, one powerful way to do that was to eliminate my debts and have some money in the bank, because the stress that it eliminated and the small sense of security that it created did in fact bring me lasting joy, joy that lasts to this day.

Beyond that, there are a handful of things in my house that I’ve bought that have brought me lasting joy. Most of them?

Maybe I thought they would and they didn’t, but in truth most of them were purchased without even thinking about the question, and now I regret it.

That money went away from something that would bring me lasting joy (financial independence) into something that doesn’t (many of the items in my home).

Let’s peel back a little bit more.

The Fourth Layer: Money Can Buy Time

Most of the things that bring lasting joy in my life require the contribution of time to bring that joy. My relationship with my wife is joyful because I invested time into that relationship.

My relationship with my children is joyful because I’ve invested time in those relationships. Some of my key hobby purchases have brought me lasting joy because I’ve invested time in that hobby.

A random meal at a restaurant rarely brings lasting joy because you didn’t commit any time to it. On the other hand, a meal eaten with a friend – no matter where it is – can often bring lasting joy because you’ve built that relationship.

It doesn’t matter where you eat, because the value comes from the thing you invested time in – that friendship.

Many people feel very time-deprived and they often use their money to buy time, but the question becomes how they use that time that they save. A person might buy some convenience foods to save on meal prep time, but how do they use that time?

There are some things you can always do with that extra time to provide lasting value. You can rest. You can build a lasting relationship with someone. You can learn a new skill or some key knowledge.

The thing is money can certainly buy time, but it similarly becomes a waste if you don’t do anything valuable with that time.

Let’s peel back a little bit more.

The Fifth Layer: Money Can Buy Freedom

Spending money to buy time in the form of time-savers like convenience foods and time-savings services is a great way to get some spare time in the short term, but it doesn’t help with the long-term problem unless you use that extra time perfectly and build it into something lasting.

The long-term solution is, rather than using your extra money to buy time, you use it to buy freedom.

Let’s say that you were in a situation where you had enough money saved and invested so that the income from those investments could replace your salary. What would you do with your time in that situation?

That’s not “time saving.” That’s freedom, and money can buy it.

We’re kept away from that kind of freedom by the need to earn money, and whenever we use money in a way that doesn’t either create lasting joy or pave our way to this kind of freedom, it’s probably not the best use of that money.

At that point, you have about as much freedom of choice with how to use your time and energy as you can possibly have. You choose what to invest your time and effort into, and if you choose to invest it into things that provide lasting personal joy, you’re going to be building a joyous and personally rewarding life.

Is There a Core?

Once you get beyond that layer, you start to quickly get into issues that involve what you personally value. Perhaps you value your children. Maybe you value a particular hobby, or maybe you really care about a certain social cause.

At that point, you start tying your financial choices directly to those things that you care most deeply about and you begin to see the connections between your choices in each area.

Gradually, that begins to spread to all of your actions. You have only so much time and so much energy. How can you use them most effectively to not only keep yourself alive, but actually have an impact on the things you truly care the most about?

At the outer layers, money appears to be at the center of all things, but after a while you begin to see it for what it is.

It’s a medium – a way of exchanging our time and our energy for things we care about. Almost every personal finance problem that we run into comes from making poor trades.

The true core of personal finance, from what I can tell, has little to do with money at all.

Spend your time and energy on things you care about. Sometimes, that means accumulating resources so that you can feed, clothe, and house yourself and the people you love the most. Sometimes, it means using your time and energy on the things that really matter to you, whatever they might be.

The best life you can have is all about spending your time and energy on the things that make your life as good as possible, both now and in the future. As far as I can tell, if there’s a core, it’s that, and getting there involves figuring out how to make your trading of time and energy for those other things as efficient and smart as you possibly can.

Article Source: PTLM

Good luck on your journey to the center.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

Household debt – can we be at 54%?

Being a teenager, my grand-daughter started to pick up interest on how the economy works, what are the real assets and liabilities in one’s financial planning. As the topic itself can be slightly “dry”, I made an attempt to discuss it in a way that was easier for her to digest.

“Our national household debt to GDP ratio edged up to 87.9% last year. Is the number alarming?” she asked one day.

“It depends. We have good debts and bad debts in life. For example, 10 years later, our new cars may have depreciated more than 80% and our new clothes would have been worn out. Those are liabilities. On the other hand, houses are assets as they will appreciate in the long run. Debts which are backed by appreciating assets are considered good debts,” I said.

As she nodded in agreement with my simple explanation of good debts and bad debts, her question has piqued my curiosity to look into the details of our household debt.

Overall is our nation having more good debts or bad debts?

A Bank Negara report shows that our household debt was at RM940.4 billion or 87.9% of GDP as at the end of 2014.

Residential housing loans accounted for 45.7% (RM429.7 billion) of total debts, hire purchase at 16.6%, personal financing stood at 15.7%, non-residential loans were 7.7%, securities at 6.5%, followed by credit cards and other items at 3.9% respectively.

At first glance, our residential housing loans were the highest among all types of household debts.

However, a recent McKinsey Global Institute Report highlighted that in advanced countries, mortgages or housing loans comprise 74% of total household debt on average.

As a country that aspires to be a developed nation by 2020, our housing loans that stand at 45.7% is considered low. In other words, we are spending too much on other depreciating items instead of appreciating assets like houses.

If advanced economies, which are usually consumer nations, have only 26% debts on non-housing loans, we should not have as high as 54% loans on items such as hire-purchase (which are mostly cars), personal loans, credit cards and others.

If we were to follow the household debt ratio of advanced economies, our housing loans of RM429.7 billion should be at 74% of total household debts, and other loans should be reduced from 54% to 26%, i.e. from RM510.7 billion to RM150.9 billion.

With such reduction, total household debt would be slashed significantly from RM940.4 billion to RM580.6 billion (existing housing loans plus reduced non-housing loans), the amount would be at 54.2% of GDP instead of 87.9%.

I am wondering why we can’t have a household debt to GDP ratio of 54.2% as illustrated above. Are we spending too much on depreciating items?

Non-housing loans comprise mainly borrowings for cars, personal loans and credit cards. Car value depreciates about 10% to 20% per year based on insurance calculation and accounting practice.

Borrowings for personal loans and credit card are also likely to depreciate over time which can be dubbed as “bad debt”.

Perhaps it is time for the Government to introduce massive cooling off measures for non-housing loans in order to curb bad debt in our household debt.

According to our Deputy Urban Wellbeing, Housing and Local Government Minister, our homeownership rate currently stands at 50% and the Government strives to increase the number with more affordable homes. As a comparison, almost 85% of Singaporeans are homeowners.

We can expedite the above vision if more stringent measures are imposed on non-housing loans, it will free up more resources for household financial planning. The rakyat should be encouraged to secure a roof over their heads with effective execution of affordable housing policy by the Government.

It is time to re-look our debt categories and reallocate our resources appropriately. If we are willing to cut back on cars, clothes, shoes and other depreciating items, reducing a household debt to GDP ratio of 54.2% is not only an aspiration, but an achievable reality.

And the more beneficial effect is, more rakyat will have the financial resources to own a house, which is both a shelter and an appreciating asset.

Article Source: PTLM

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

No More BLR: Effective Rate versus Base Rate

Effective 2 January 2015, the Base Rate (“BR”) has replaced the Base Lending Rate (“BLR”) as the main reference rate for mortgages and loans.

The Base Rate is touted to be more transparent and allows customers to easily identify banks that are offering the best rates for loans. According to Bank Negara, the new reference rate will comprise two elements, which are the Base Rate and the “spread”.

The Base Rate is determined by banks’ cost of funds and will differ marginally from one bank to another. Typically, banks that are able to attract cheap long-term fixed deposits will be able to offer lower Base Rates as opposed to banks that depend on the more expensive inter-bank market for funding.

The “spread”, meanwhile, essentially comprises elements such as the bank’s overheads and the credit risk profile of borrowers. This effectively means that banks that are less efficient and incur high overheads will not be able to offer competitive rates.

However, the new framework will not bring about any changes in the cost of borrowing for consumers or impact the profitability of banks.

Before this, the BLR was the standard benchmark used by banks to determine the loan rates for consumers. The more efficient banks that enjoy a lower cost of funds offer rates as low as 2.4% below the BLR that is now pegged at an average rate of 6%.

However, it sometimes becomes difficult for customers to differentiate the rates between one bank and another because there is no breakdown in the cost of obtaining a loan.

tableArticle Source: PTLM

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

All About Penang Properties in ONE Website

 

Started in 2010 with only one objective – To provide quality, accurate and up-to-date information to any readers who are keen on property news and new projects in Penang.

After 6 years, Penang Property Talk is no longer only a blog but also one of the most popular property news portal in Penang which has registered more than 1.6 million visits in 2015 with visitors from over 180 countries.

Penang Property Talk has attracted hundreds of thousands followers and is now a dose of daily property news for many home buyers, developers, real estate agencies, investors, researchers, contractors and other property industrial players.

A picture is worth a thousand words, a video is worth a million pictures. Our next mission is to continue providing more updates, not only in photos and text, but also via video.

Article Source: PenangPropertyTalk

This forum has give me more knowledge.

For more information about Property Investment, please visit 👉 Property Millionaire Intensive

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