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Kuala Lumpur & Malaysia Property (MY#1)

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Kuala Lumpur & Malaysia Property (MY#1)

Investing in New and Secondhand projects ... Charts- for Malaysian Property Developers

==============================

Skyline08-KualaLumpur.jpg

 

Started at the time of a property exhibition:

15-16 March : HK Convention & Exhibition Centre / Harbour Rd. Entrance (10am - 7pm)

Land, Pre-Launch Developments, Enbloc and Completed deals (available direct from developers)

website: http://www.homebuyer.com.my

 

MAP

my_map1.jpg

 

The Property Talk is a two-day event complementing the International Homebuyer & Property Investor exhibition. Admission is free upon registration. The objective is to provide you with wealth of knowledge and information, essential resources for homebuyers and serious investors for their property investment decisions.

 

In additional to the range of investments opportunities on offer, the Property Talk is the ideal place to network with industry players. If you are a novice investor, talk to the industry experts to help you to make the most of the property opportunities open to you.

 

+ + +

 

Here was my "best guess" on how the 18 year cycle might be applied in Penang, Malaysia.

zzzz.gif

 

In KL, it looks like the cycle peaked about 3 years earlier, in 2008. Normally, the cycle requires at least 3-4 years off the top, to make a low. So we could see a bottom as early as 2011-12.

 

= = = = =

gsemultipart16382lg3.jpg : MY Property News

LINKS:

===========

Int'l Living: MY.. : http://www.internationalliving.com/countri...1/asia/malaysia

News, etc......... : http://star-space.com/

Prop-Rept.MY&S : http://www.property-report.com/apr_singapore.php?date=032008

Project Reviews : http://www.iproperty.com.my/reviews/reviews.asp : Project List

Skys List, 2004. : http://www.skyscrapercity.com/showthread.php?t=102116

TL Magazine..... : http://www.tropical-living.com/

Malaysia Blog... : http://propertymalaysia.blogsome.com/

The Edge, MY... : http://www.theedgeproperty.com/

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Malaysia set for steady growth (in Supply)

Signs point to a slowdown in Malaysia’s residential property market for 2008

 

Developers in KL will continue to target wealthy buyers looking for lifestyle-focused developments.by Pete Wong All signs point to a slowdown in Malaysia’s residential property market for 2008 after unprecedented global economic growth over the past few years, partly resulting in the US subprime mortgage crisis. “Subprime worries are expected to linger into 2008,” said Datuk Bridget Lai, CEO of Alliance Finance Group. “Inflation will be a key concern in 2008 and high inflation may curb consumer spending. However, private investment is expected to cushion the moderation in consumer spending,” she added.

 

The Malaysian Institute of Economic Research (MIER) has predicted a slower 5.4% growth for 2008, after an estimated 5.7% growth for 2007. Meanwhile, Prime Minister Abdullah Ahmad Badawi has announced a more optimistic 6% projected GDP growth for 2008, although he warned of rising oil prices affecting the economy.

 

On the property front, demand for building materials will increase not just in Malaysia but throughout the region. With the rollout of new projects announced under the Ninth Malaysia Plan (9MP), the demand for steel, cement and quarry products will increase, resulting in higher prices for such raw materials.

 

Patrick Wong, President of Master Builders Association of Malaysia, estimated that the rise in construction costs will be between 20-30% for 2008. Amid tough competition, it would be difficult for developers to increase pricing for mass-market residential properties and pass on higher construction costs to end-purchasers. Consumers are already saddled with inflation and rising fuel costs.

 

The likely scenario would be a slowdown in the roll-out of mass-market residential properties by developers and a shift in focus to the more lucrative high-end segment. The year 2008 will most likely see a slew of new luxury properties competing to attract the well-heeled and high net worth investors.

. . .

The question remains: will there be enough buyers to take-up the slew of luxury homes on offer?

Tan Sri Liew Kee Sin, CEO of IOI Properties, said the company was targeting the “cream of society, a select group of tycoons who want to experience the ultimate extravagance and pampering that money can buy”.

 

Gan Thian Leong, Brunsfield’s Group Managing Director, echoed the sentiments: “We expect our limited edition bungalows to be snapped up by both Malaysians and foreign buyers, including Middle Eastern, Europeans, Chinese, Koreans and Japanese.”

 

Investing in luxury properties in Malaysia makes sense for the well-heeled and for foreign investors. N.K. Tong, Bukit Kiara Properties’ Group Managing Director, said: “Benchmarked to the region, Malaysia is still incredibly affordable, both from an absolute perspective as well as from an affordability index.”

. . .

Target: High rollers

 

Kuala Lumpur is not yet the same as Singapore or Hong Kong. Firstly, there’s no serious issue with scarcity of land. Secondly, unlike these high-growth economic hubs which attract top-level executives as MNCs set up regional head offices, KL sees more mid-level expatriates coming in to work in factories or on construction and infrastructural projects. These mid-level executives are unlikely to pay the high monthly rentals for luxury properties.

 

Thirdly, population growth in economic hubs like Singapore and Hong Kong is largely due to an influx of knowledge workers with high salaries. In KL, population growth is largely due to rural-urban migration, with local workers from other states coming to the city in search of entry-level jobs. The increase in city population will more likely result in a demand for mass-market housing rather than high-end residential properties.

. . .

If one were to invest in Malaysia, which would be a good location? “From a residential point of view,” Tong answered, “I would favour Kuala Lumpur City Centre (KLCC), Mont’ Kiara and Penang beachfront properties.”

 

(Guess what? That's were the expensive supply is coming.- DrB)

 

/more: http://www.property-report.com/apr_singapo...amp;date=012008

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Advertisement: from SCMP:

KUALA LUMPUR: Low Density Luxury Condominium / First-release, off-plan price

 

Hijauan Saujana

raintree08cs6.jpg

 

Price from : HK$ 1.6 Million / Booking fee HK$50,000, cheque or cash

 

+ Next to two Golf resorts & the Japanese internatonal school

+ Shopping malls nearby

+ Two units per floor, size: 1,722 to 4,273 sf

+ 3 ensuite bedrooms + maids room + 2 car parks

+ swimming pool, clubhouse, tennis court, landscape garden, etc.

 

main.jpg

 

Also promises:

 

+ Huge growth potential in positive KL market

+ Huge appreciation potential of Ringgit

+ No Real Estate Gain tax

+ Bank financing up to 80%

+ RENTAL GUARANTEE: 2 years at 12% in total

 

Developer: http://www.echomes.com.my

 

Hijauan Saujana offers residents a hidden paradise

 

Imagine driving home after a long day at work - leaving behind the hustle and bustle of the office - your stress melts away as you drive up a beautiful lush landscaped garden to get to your much needed sanctuary; a hidden paradise known as Hijauan Saujana - a service apartment found in the exclusive Saujana Resort.

 

Peace and tranquility are the main focus of the development, which is why the two tower blocks are designed in perfect harmony with nature's serenity.

 

In each unit, there are spectacular views of the surrounding greenery and the internal cascading water themed garden, inviting its residents to let their troubles disappear as they relax.

 

Hijauan Saujana

Subang (Saujana Resort), Shah Alam, Selangor

From RM600,000

Location Map: http://www.iproperty.com.my/property/development.asp?pid=974

Property Type: Serviced Residence

Land Title: Commercial

Tenure: Freehold / Land Area: 5.5 acre

Built Up: 1,600 sq.ft. - 4,200sq.ft.

Indicative Price: From RM600,000 Recommended Loan

Total Units/Lots: 200

Bumi Discount: 7%

Photo Gallery: Roof Top Garden. Water Feature, Swimming Pool, Private Storage, Guard House

 

Posted Date: 25/6/2007

 

/more: http://www.iproperty.com.my/reviews/esquire/coverpage.asp

 

= =

 

"Imagine driving home" ?? : they dont effing get it!

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MONT KIARA, Mont Kiara, Kuala Lumpur

 

Mont-Kiara-PR-med.jpg

 

Mont Kiara, an exclusive development of condominiums located in the suburbs of Malaysia’s capital city, Kuala Lumpur. Mont Kiara is a global community that attracts affluent professionals as well as a diverse group of expatriates.

 

Mont'Kiara Banyan

 

Property Type: Condominium

Land Title: Residential, Freehold

Land Area: 3 acre

Built Up: 1,838 sq.ft. - 2,648sq.ft.

No. of Bedrooms: 3+1, 4+1

No. of Bathrooms: 3, 4

Total Units/Lots: 147

 

Facilities:

Multi purpose Room, Lounge , Multi-purpose Hall / Badminton Court

Children's Playground, Swimming Pool

Landscape, Tennis Court, Car Park Lift

Visitor's Car Parking Bays , Car Washing Area, Guard House

 

 

DEVELOPER

========

Sunrise Benchmark Sdn Bhd (686400-K)

Penthouse, Wisma Sunrise, Plaza Mont' Kiara, No 2, Jalan Kiara, Mont' Kiara 50480 Kuala Lumpur

Phone: +603-6201 2288

Fax: +603-6201 5000

sunrise@sunrisebhd.com

http://www.sunrisebhd.com/sunrisecorp/

Angeline Goh, Project Sales Executive

603-2093-7777 -mob: 019-339-8308 / angelinegoh@sunrisebhd.com

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2005 Example : Type: Freehold Condominium

1156_IMG_0039.jpg

 

Vista Kiara, Mont Kiara

Mont Kiara, 50480 Kuala Lumpur, Malaysia

 

Price: RM1.3million

 

Located In the vicinity of Mont Kiara/Sri Hartamas and opposite the Garden International School. Vista Kiara is well known for its innovative architectural design, unique aquascape landscaping and practical functional layouts. On the most top level a duplex with 4+1 bedrooms with upgraded kitchen and bathrooms The asking price of RM1.3million is an attractive price for investment returns..

 

Built-Up Area: 3,135 sq ft

No. of Bedrooms: 4+1 / No. of Bathrooms: 4

Features:

Children Playground, Pool, Matured Garden, Tennis Court, Squash Court

Gymnasium, Security, Laundry, Mini Market

 

/see: http://www.wtw.com.my/2005/component/optio...1156/Itemid,32/

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D'Rapport @ Ampang, a high-end condominium project in the Embassy district

KLCC, Ampang, Kuala Lumpur ... Listing Price: From RM1,602,270 - RM5,518,304

...

Units: 410 // Built Up: 1,100.71 sq. ft. - 4,496.15 sq. ft. Land Area: 37.55 acre

 

Official Website : http://www.d-rapport.com

 

= = = = =

 

Korean partners for D'Rapport

21 Jan 2008: By Yap Yew Jin / THE EDGE DAILY

 

More South Koreans are participating in the Malaysian property scene, particularly in joint ventures with local developers. This is an upcoming trend due to the number of Koreans in our country and following the relaxation of rules on foreigners investing here. There is currently about 30,000 Koreans living and working in Malaysia, with about 15% concentrated in Ampang in the Klang Valley, and the rest in major cities across the nation.

 

One of the latest joint venture between the two countries involves Klang-based Acmar International and Korean property development and construction company Menos 21 Co Lte, to develop D'Rapport @ Ampang, a high-end freehold condominium project right in the heart of Malaysia's Korea Town. It is located next to the Korean embassy and opposite Great Eastern Mall in Jalan Ampang, Kuala Lumpur.

 

Menos 21 arrived in Malaysia 10 years ago but was approached by Acmar only three years back. Through mutual understanding and the good location of the piece of land, the two entities form a strategic business alliance to develop the project, along with Perbadanan Kemajuan Negeri Selangor (PKNS), the landowner. While Acmar will be handling the construction, its Korean partner will be in charge of designing as well as marketing the product.

 

Acmar has been involved in the automotive business in Klang since 1979 but later diversified into property development and management, construction, leisure and entertainment, education, healthcare and warehousing. It boasts an annual turnover of over RM200 million and existing landbanks with an estimated gross development value (GDV) in excess of RM1.5 billion.

 

The group has completed several residential and commercial projects including:

Taman Jati in Jeram, Taman Cempaka in Banting, Wisma TLT in Klang and Acmar Villa in Ampang.

Its ongoing projects include Taman Putra Impiana in Puchong, Bandar Baru Klang in Klang and Kemensah Indah in Melawati.

 

Its group managing director Datuk Steven Tee says since D'Rapport is the group's first high-end project, a certain degree of standard and excellence must be set to draw purchasers to the development. "The quality and finishing of our condominium development is very important and the design has to suit the taste of foreigners, particularly Koreans, who would be our main target buyers," he tells City & Country.

 

big_1_2.jpg

 

Two phases

D'Rapport comprises two phases, the first targeted for launch next month followed by the second next year. The first phase called Festa is situated on a 9.12-acre tract and consists of five condo blocks of 1,099 units, sized from 1,100 sq ft to 2,300 sq ft. There are also eight penthouse units of 4,400 sq ft each. Prices range from RM700,000 to RM1.5 million (averaging RM700 to RM800 psf) for a GDV of RM1.5 billion. Maintenance fee is tentatively fixed at 25 sen psf.

 

Tee explains that at first glance, the development might seem highly dense but that would not be the case when taking into account both phases. "The approved layout plan is on a 62.5-acre tract, of which 44 acres would be for the development of D'Rapport. This would come out to a density of about 50 units per acre for both phases," he says. The number of units for Heros' second phase has yet to be determined. A 25-acre flood mitigation pond separates the two phases, and the group intends to invest about RM3 million in beautifying and upgrading it into a recreational park for the residents.

 

big_1_3.jpg

 

Location-wise, he says the project is situated 3km away from the city centre and is surrounded by amenities including shopping malls, international schools, a medical institution and about 50 embassies and foreign legations. Festa will have three half Olympic-sized swimming pools, a 650m jogging track and about 2,409 car park bays within the development.

 

"For any project, location plays a very important role, while easy access and convenience are some of the other things (foreign) buyers look for," says Tee, adding that the development would have direct access to the KL-Ampang Elevated Highway, and hence it is only five minutes away from KLCC.

 

He says the group is in negotiations with several Arab, Hong Kong and Korean parties for en bloc sales of two blocks of the development. About 30% of the remaining 689 units in Festa have been sold, with 40% of the buyers consisting of Koreans. "We also held roadshows in Singapore, Hong Kong, Indonesia, and of course South Korea, as we are targeting 40% to 50% of the development at them," he offers, adding that he hopes to achieve 50% sales after Chinese New Year.

 

Tee is confident D'Rapport would be well-received because of its competitive price as developments within the KLCC area have breached the RM2,000 mark. "In fact, we believe the value of the units in D'Rapport will appreciate by 30% within the next year and almost double upon its completion in three years," he says.

 

He adds that although condominiums in Mont'Kiara are priced slightly lower, at RM600 to RM700 psf, many buyers still prefer to purchase properties closer to the city centre.

 

On the property outlook for this year, Tee says there is strong potential in the high-end property market as there is a shortage of such developments. "There are too many low to mid-end properties in the market with the demand for high-end properties still high," he says, adding that foreigners, especially those from the west and Middle East, are always looking to invest here as Malaysia has one of the lowest property prices in the region.

 

The group is planning to launch a high-end mixed development in Shah Alam in the future, depending on the market conditions. "However, we would now like to focus on our D'Rapport project, as that would last us another five years," says Tee.

 

Malaysia popular for Koreans

Korean Press director John K T Kim says Malaysia is the second-most popular destination for Koreans investing in real estate abroad, just behind the US. "Many of them are looking overseas because Korean real estate is very expensive due to a shortage of land there," he says. Launched in 2000, Korean Press is a bilingual information website and newspaper for the Korean community in Malaysia.

 

Kim says condos in the Golden Triangle of South Korea (areas such as Kangnam and Kangbuk in Seoul) are priced at about RM10 million for a 2,000 sq ft unit, which is equivalent to about RM5,000 psf. "However, that is only the average price as high-end ones are priced at RM10,000 psf to RM50,000 psf and up to RM100,000 psf for top-end properties," he adds.

 

He also says the high tax incurred by Koreans buying more than two properties in their homeland is forcing more to seek elsewhere for property investment and living. "They prefer condominiums in Malaysia as the developments come with facilities such as swimming pools and gymnasiums, which are not readily available in Korean condominiums," he offers.

 

He expects the population of Koreans in Malaysia to double to about 60,000 by next year if the government sets up more international schools to cater to the increasing educational needs. "Due to an over-quota in Korean schools, many are looking for options in other countries," says Kim, adding that during his 19-year stay in Malaysia, an influx of Koreans here was evident only three years ago.

 

/more: http://www.skyscrapercity.com/showthread.php?p=18517153

 

contimg_gosales1_2.gif

 

Location : D' Rapport is a short walk NORTH of the Menara Great Eastern Mall

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I didnt know you were interested in Malaysia, Dr.B.

 

One of the websites that I have visited, lists these as his favorite projects:

 

TOP 7 SKYSCRAPERS

=================

 

1.PGCC - PENANG

2.MILLENNIUM RESIDENCE - KUALA LUMPUR

3.SETIA ECOCITY - JOHOR

4.DBKL TOWER - KUALA LUMPUR

5.TROIKA - KUALA LUMPUR

6.THE CAPERS - KUALA LUMPUR

7.4 SEASON - KUALA LUMPUR

 

The Troika looks really interesting.

Have you visited it? What did you think?

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The Troika looks really interesting.

Have you visited it? What did you think?

 

I havent been to KL for over 25 years! But I will visit this weekend.

 

dreamhousevu1.jpg

 

I also heard about Troika, that it was a very successful launch last year.

Maybe we will go to see it.

 

Troika project page : http://www.iproperty.com.my/property/devel...int.asp?pid=892

 

OTHER PROJECTS : http://www.iproperty.com.my/property/devel...ord=&page=2

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Dr Bubb

 

It would be good to know if you take the plunge in Malaysia and invest in property here. Perhaps you already have?

 

I have bought a couple of off-plan units on the Golden Palm Tree Resort on the Sepang Gold Coast. I am looking to add something in KL but have yet to find the right deal.

 

Thanks

d

 

 

 

 

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I havent been to KL for over 25 years! But I will visit this weekend.

 

Fantastic, Dr B - you are in for a treat. I love KL. Because:

 

- cheap computer equipment in Bukit Bintang (but no 'cheap' software any more ;) )

- great food. Try the Jalan Alor market just alongside Jalan Bukit Bintang. Amazing selection, all quality.

- Jalan Sultan in Chinatown, more great food if you like dai pai dong style (applies to the above)

- Petronas towers for cheap clothes, books etc. I reckon it should a bit cheaper than Honkers.

 

Have fun! B)

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I am looking to add something in KL but have yet to find the right deal.

Thanks

 

Have you looked at D' Rapport ?

Maybe it is too expensive for some

 

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I love KL. Because...

 

Any thoughts on Penang?

 

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Any thoughts on Penang?

 

Haven't been there since I was a nipper in the 70's, but it was beautiful.

I remember Pulau Penang was very busy. Great zoo!

 

 

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Monday, July 30, 2007

KL’s 10 most expensive condos

 

By THE STAR

 

The excitement in the property sector over the spiralling condominium and land prices in the KLCC area over the last four months seems to be gaining momentum. Top property consultants tell StarBiz how to separate the wheat from the chaff.

 

WHICH single condominium development in Kuala Lumpur is considered to be the priciest in Malaysia? The dust hasn’t settled on this issue as two purported contenders for the title have yet to be launched.

 

According to KL property experts, the 10 most expensive condominium developments based on current prices are all sited in the Kuala Lumpur City Centre (KLCC) area (see Table A) except Pavilion Residence. However, if the yet-to-be launched Four Seasons and Binjai developments were taken in account, those falling below RM1,000 per sq ft would be out of the list.

 

But the “asking price” and “transacted price” may not necessarily match. Currently, the costliest average price per sq ft has been transacted at RM2,000 for the One KL project. This development is noted for its marketing strategy of one swimming pool on every floor. The tower has 35 levels.

 

Developers who launched their condominium projects earlier are now frantically revising the pricing policy for their remaining units. And those who have yet to launch are now trying to push the limits.

 

But all eyes are trained on the Binjai and the Four Seasons projects – touted to fetch more than the current benchmark of RM2,000 per sq ft. The Binjai management purportedly “screens” prospective buyers and even require an interview. The showhouse has long been off-limits even to ordinary tycoons.

 

Foreign as well as local interest in Kuala Lumpur’s luxury condominium developments seem to have been spurred by the Government’s relaxation of residential ownership rules for foreigners and the waiver of real property gains tax (RPGT) recently. And what’s happening in Singapore’s high-end condominium property market is having an effect on KL.

 

High-end properties in KL’s prime residential locations are considered to be the cheapest in the region. This has given rise to the rare phenomenon of residential property fetching even higher rentals than office property in KL. For example, the office rental rate at the UOA building in Jalan Pinang was recently transacted at RM3.80 per sq ft while a tenant at 3 Kia Peng condominium is in negotiations to renew his tenancy for RM4.50 per sq ft.

 

 

Demand for the “best” condo-developments is at an all-time high with record-breaking prices per sq ft quoted – even for land in the KLCC area. For instance, the plot of land occupied by the Hakka Restaurant at Jalan Kia Peng was reportedly sold via tender for over RM1,300 per sq ft recently – a record price.

 

And what do our local market experts have to say about such transactions and dizzying prices?

 

 

Avare

S.K. Brothers Realty (M) Sdn Bhd general manager Chan Ai Cheng said: “Technically, all KLCC condominium developments are considered to be high-end properties in terms of price and quality. Super-condos – as opposed to high-end condos – are merely super 'big' in terms of size alone.

 

“The pricing structure of high-end KLCC condos will depend on whether they are located within the first tier or second tier of land.”

 

The Petronas Twin Towers are regarded as the epicentre of the KLCC area, with the surrounding lands viewed in terms of concentric bands with the first tier being closest to the towers.

 

For example, the first-tier condo-developments will include projects like One KL and K Residence and the second-tier will include Hampshire Park, The Meritz and Cendana.

 

Property agents look at the desirability of condo developments based on various factors depending on the targeted tenants for the units to be rented or leased out.

 

The development must be easily accessible and the type of neighbourhood should suit the targeted tenants. Does the neighbourhood offer a ready catchment of tenants such as expatriates?

 

If the targeted tenant is the young and happening type of expatriates instead of family-oriented expatriates, then the condo-development should be near the bars and entertainment areas.

 

 

One Menerung

Land status is very important. If the development is on commercial land instead of residential land, then the rental yield will be affected by the commercial rate for quit rent and utility bills. For example, your monthly electricity and water bills will be charged the commercial rate.

 

The track record of the developer is equally significant. Certain established developers like Tan & Tan have their own following. These repeat buyers will buy anything they build, explained Chan.

 

Unlike the old days, developers now will usually have done all the studies they need to formulate their pricing policy. They would price their property at what the market needs now.

 

But buyers ought to be aware that if a developer were to build all the condo units in the same size, you will have a tough time renting out your particular unit. You will be competing with many other owners trying to rent out their units.

 

Also, the team of consultants engaged for the project is important. Buyers generally like “branded” properties. For instance, the Troika developers have engaged Foster and Partners and astute buyers are confident that with such a prestigious architectural firm, the condo design won’t be easily “outdated”.

 

Buyers of high-end condos who wish to rent out their units have to understand the expatriate rental scale. For instance, a multinational executive transferred to KL may only have a monthly rental budget of RM5,000 and ambassadors may have an average of RM15,000. So, if you wish to rent out at RM20,000 a month, you are looking at a tenant in the top position in a multinational. The question you must ask is “Who is going to be your tenant?”

= =

 

Posted by Bernard Yong at 10:32 AM

Labels: Condominium/Apartment, Kuala Lumpur, Residential

Taken from Malaysia Property Blog July 07, bit out of date but still relevant .

 

Updated daily with good Malaysian property info :

http://www.mypropertynews.blogspot.com if you are interested

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...from the JB- MY#3 thread...

 

I am just starting to do my due diligence with respect to Malaysian property ownership.

Are there any concerns with foreign ownership ie land rights , short leases (like Vietnam),

political considerations that you would be concerned about ?

 

We are new to Malaysia also.

The risk factors look reasonable from what we have seen and heard.

 

My biggest concern is the market- the risk that KL and Penang are going to be overbuilt:

 

+ There has been a tremendous ammount of building over the last 1-2 years, with many more

new projects being started now, with completion expected to take 3 years.

 

+ I can see a serious GLUT developing by 2009-2010, if not earlier,

 

+ The way the market works is that once you have taken your financing, the bank controls the

title, so it is virtually impossible to sell until completion. So there's no liquidity when you are

STUCK IN THE PIPELINE. By now, there are thousands of properties in the pipeline, with their

owners expecting to flip at a profit, but no way to do that. And the pipeline is getting bigger

with all the new projects gettings started now. The market is NOT REFLECTING this huge supply

now, because the owners of those properties have no way to sell.

 

+ Given the above, the market may already be in serious oversupply- but we will not see that

until 2009-2010, when the properties can be sold.

 

People think the Malaysian market is rising, and healthy, because the properties that are completed

are changing hands at higher prices. But the reality may be different, and a growing oversupply may

be made worse bty every new property being launched.

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...from the JB- MY#3 thread...

 

We are new to Malaysia also.

The risk factors look reasonable from what we have seen and heard.

 

My biggest concern is the market- the risk that KL and Penang are going to be overbuilt:

 

+ There has been a tremendous ammount of building over the last 1-2 years, with many more

new projects being started now, with completion expected to take 3 years.

 

+ I can see a serious GLUT developing by 2009-2010, if not earlier,

 

+ The way the market works is that once you have taken your financing, the bank controls the

title, so it is virtually impossible to sell until completion. So there's no liquidity when you are

STUCK IN THE PIPELINE. By now, there are thousands of properties in the pipeline, with their

owners expecting to flip at a profit, but no way to do that. And the pipeline is getting bigger

with all the new projects gettings started now. The market is NOT REFLECTING this huge supply

now, because the owners of those properties have no way to sell.

 

+ Given the above, the market may already be in serious oversupply- but we will not see that

until 2009-2010, when the properties can be sold.

 

People think the Malaysian market is rising, and healthy, because the properties that are completed

are changing hands at higher prices. But the reality may be different, and a growing oversupply may

be made worse bty every new property being launched.

-

 

I am fortunate in that my Condo that I bought off plan just outside KLCC is completing in May and will probably sell this.

 

A couple of things to note . Most of it is common sense so please excuse me for mentioning it here.

 

There is nearly always a delay, 6- months is fairly standard.

 

Malaysian Solicitors that I have come across are extremely inefficient and expensive. They will quote you a fixed price based upon the Malaysian Bar Councils' recommended rate, which is not negotiable (in reality they will reduce this by 50%) and the difference is written off as a bad debt. Please let me know if anyone knows a decent solicitor.

 

Up to now cash has always been made on flipping condos, with the best price being achieved about 6 months after the completion.

 

You need to be careful of your developers reputation to maintain the price on new builds and the management company after is important (I picked a condo in Damansara Heights for 300 RM per sq ft last May this is now under new management and about to be painted), which will cost me about 4k RM but should enhance the rental and re-sale value.

 

Bangsar, Kenny Hills and Damansara Heights (not to be confused with Damansara itself) have restricted new build (no land left or it has been taken up by high end houses) so may be worth a punt rather than KLCC.

 

Mont Kira on the other hand is still being built (more high rise than the other three areas) . It is favoured by Japanese and Korean ex pats who are used to this type of environment.

 

Penang I love and have lots of mates there, with Gurney Drive being the place to live apparently, or Tangung Bunga/ Batu Ferrengi (the main toursits resorts).

 

If you go to Penang drive to the South of the Island, it is still Jungle and Kampung (village) and there are possibly some opportunities here.

 

JB I've never been to but I think it could turn into another Putra Jaya (between the airport and KL), which is a government sponsored development, which will take about 20 years to mature and for house prices to rise. There is also rumoured to be a problem with crime in JB.

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VERY USEFUL Comments, Matsali !

Thank you for sharing those. That's exactly the sort of in-the-know posting that is most valuable

on GEI.

 

Up to now cash has always been made on flipping condos, with the best price being achieved about 6 months after the completion.

 

You need to be careful of your developers reputation to maintain the price on new builds and the management company after is important (I picked a condo in Damansara Heights for 300 RM per sq ft last May this is now under new management and about to be painted), which will cost me about 4k RM but should enhance the rental and re-sale value.

 

Our estate agent friend told us the same thing:

We shoudl look to flip soon after completion, and be very careful about the developer.

 

Now I am wondering: WHO is buying all these newly completed condos??

Locals to live in? Locals to rent out to expats?

Rich expats for own use??

Are there enough of these buyers around to absorb the increasing supply?

 

My worry is, a global recession, would hit people's incomes, even in Asia,

and there would be significantly less demand than the market needs.

 

I have to say, I prefer the HK market, where there's a second year of modest supply of newbuildings

being completed. AND... HongKongers have no problems in reselling properties they bought offplan

prior to completion. So it si not an "artificial" market like you are seeing now in Malaysia.

 

What do you think the prospect are for Penang?

Might the city have an easier time attracting foreigners thanks to its history and livability for foreigners?

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Capital assets

Stephanie Tong ... Thursday, March 13, 2008

 

Property investors seeking capital gains in residential assets in Asia may want to look beyond the altered political landscape in Malaysia and the heavily rattled equity market and instead turn their attention to condos in the country, where the economy grew 6.3 percent last year.

Some agents are bullish on the prospects for property in the capital.

 

"This year, my number one market [in Asia] will be Kuala Lumpur. It does not have capital gains tax. Prices there are low when compared to Singapore and Hong Kong," says Tim Murphy, director of Intellectual Property.

 

In April last year, the government abolished the real property gains tax and the three-loan limit imposed on housing loans by foreigners.

 

According IP, luxury condominiums in KL are selling at about HK$1,300 per square foot, which is 15 to 20 percent of that in Singapore.

 

"In the fourth quarter last year, average high-end condominium sale price in KL was about 580 ringgit [HK$1,412] psf," says Malathi Thevendran, executive director of Jones Lang Wootton, in Kuala Lumpur.

 

Over the past two to three years, several condominium projects have been built near Kuala Lumpur City Centre.

 

Robert Ang, managing director at Rahim & Co Real Estate Agents, an associate of property consultancy Savills, says: "Projects built in 2004 or 2005 all appreciated anywhere between 30 and 50 percent in the past two to three years, reaching 1,000 ringgit psf."

 

Yet, the trend of condominium sale price hinges on supply, he not

es.

 

"The supply of condominiums is the concern. Sale prices are likely to be stable this year and next. Unlike 2004 or 2005 - the time when you could just buy anything and you could still make money - buyers need to be selective now.

 

"Most of the projects undertaken in 2004 will be completed by the end of this year or early next year. Including all the condominiums in the high-end and mass market, at least 3,000 to 4,000 units will be launched in the market after 2009. This is indeed a large amount."

 

Thevendran, however, expects a rise in average condominium prices before next year. "There will be growth but it is likely to be less than 10 percent a year as year-on-year growth has been quite high in the past two years, reaching about 10 percent per annum.

 

"Having said that, the residential market in KL at the moment is much driven by external forces. [Although prices may not rise as much as before], there are actually players in the market who are willing to pay as they find the prices in KL lower than that in Singapore and Hong Kong."

 

Ang notes that prices will also depend on quality. "There will still be good opportunities.When you pick the right property in the right area, the price will still appreciate."

 

He reckons the best area to invest is Taman U Thant, a prestigious residential address within a kilometer of KLCC. Home to diplomats and the wealthy, the area is also known as Embassy Row. "Unlike projects in KLCC, which usually range from 20- to 40-stories, condominiums in U Thant are low-rises," Ang says.

 

There is a height limit of between three and 10 stories in the area. Projects in U Thant offer about 20 to 30 units, compared with 150 to 200 units launched at a project in KLCC.

 

"Over the next two to three years, only a couple of hundred units will be launched in U Thant. I think the area will continue to be on an uptrend but the momentum will be slower as prices have gone up in the past few years," Ang says. U Thant projects sell at anywhere between 900 ringgit and 1,200 ringgit psf.

 

Murphy at Intellectual Property, however, finds "suburbs in Malaysia more interesting than the city center."

 

"The city area has seen massive growth already. One can buy a condominium 15 to 20 minutes away from KLCC, like Mont Kiara," he notes. Mont Kiara, 15 kilometers north of KLCC, is a suburb popular with upper middle class Malaysians and expatriates.

 

"It has good schooling, transport links and good rentals. Also, it is much cheaper, only 30 percent of the price in KLCC," Murphy says.

 

Ang, meanwhile, says investors could also rent out high-quality apartments in KLCC and U Thant. "Rental yields per year can be up to 6 percent or 7 percent."

 

Thevendran, however, urges caution over the rental market in the medium to long term.

 

"The substantial surge in supply might not be absorbed domestically. After all, there is only a limited pool of expatriates buying the condominiums [for self-use]. The majority of foreign buyers are pure investors."

 

In Malaysia, foreigners can hold freehold tenure and secure mortgages. About 60 to 70 percent of the unit price can be covered by mortgages.

 

"If you look at capital gains only, Singapore and Hong Kong of course bring better returns. But Malaysia overall is more appealing as it provides rental yields in addition to capital gains," says Ang.

 

"Furthermore, it provides more stable prices compared to Hong Kong and Singapore."

 

/HK Standard: http://www.thestandard.com.hk/news_detail....080313&fc=7

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VERY USEFUL Comments, Matsali !

Thank you for sharing those. That's exactly the sort of in-the-know posting that is most valuable

on GEI.

 

 

 

Our estate agent friend told us the same thing:

We shoudl look to flip soon after completion, and be very careful about the developer.

 

Now I am wondering: WHO is buying all these newly completed condos??

Locals to live in? Locals to rent out to expats?

Rich expats for own use??

Are there enough of these buyers around to absorb the increasing supply?

 

My worry is, a global recession, would hit people's incomes, even in Asia,

and there would be significantly less demand than the market needs.

 

I have to say, I prefer the HK market, where there's a second year of modest supply of newbuildings

being completed. AND... HongKongers have no problems in reselling properties they bought offplan

prior to completion. So it si not an "artificial" market like you are seeing now in Malaysia.

 

What do you think the prospect are for Penang?

Might the city have an easier time attracting foreigners thanks to its history and livability for foreigners?

 

 

Of the 54 appartments I bought just off of the centre of KLCC only 8 are due be put out for rent (I was at first worried about

54 units coming on the market at the same time). Many have been bought by Indians, Europeans and Chinese.

 

The units are by the embassies so there are a lot of embassy staff to rent the units. They are a bit too expensive for locals

on the whole. I read last year an article on the 1 million condo and how it is keeping the local Malay from the housing market.

 

One thing to understand in Malaysia that a developer will need to give a "Bumi putra" (people of the soil) quota to the

market. This is a quota of the appartments given up to Muslim Malay, to which they will be entitled to a "bumi" discount (usually

about 8% of the published price). This can distort the figures a bit and developers are usually anxious to sell their Bumi quota.

(luckily my wife is Malay so we get a discount), whether you could negotiate this in a normal way is something I am not aware of.

But I usually push and get a bit more including the bumi quota

 

 

In future if we want to sell the condo to a non Bumi, we need to get the developers (not government) permission to do so (never

been a problem as far as I am aware).

 

Penang is a buzzing city, with lots of development going on. There should be lots of economic growth and hopefully prices will rise.

The Malay goverment has established a Northern Development Corridoor to include Penang and there should be boom times ahead.

The best places to buy historically have been Gurney Drive, Tagung Bunga and Batu Ferrengi on the North Side of the Island.

 

The South side of the Island is worth a look as it is still Jungle, Fruit Farms and Kampung (villages). There may be some inexpensive land

that could be developed here for an entreprenurial type.

 

Not quite sure how events in the US & Europe will impinge on Asia. We are starting to feel the crunch in the UK. An Estate Agent friend

of mine tells me that mortgage offers are disappearing from the screen on a daily (if not hourly) basis, but it would appear (UBS aside)

that europe isn't suffering as much.

 

My guess for what it is worth is we (europe) will get 50% of the US problems 12 months after them with Asia getting 25% of the US problems a

further 12 months on. How big the US problems are likely to be is anyones guess.

 

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Thursday, April 3, 2008

High-end properties still attracting foreigners

 

By BERNAMA

 

MALAYSIA'S property sector will continue to attract foreign investors, especially the high-end segment, despite the recent changes in the local political landscape, Asian Strategy & Leadership Institute (ASLI) chief executive officer Datuk Dr Michael Yeoh said yesterday.

 

However, the foreign investors are bound to adopt a “wait and see” attitude for now until the political scenario is much more clearer, he said.

 

The wait-and-see attitude is more likely to affect the high end properties that depend on foreign purchases like those in the KLCC areas or those above RM2,000 per sq ft.

 

Presenting a talk in Kuala Lumpur yesterday on the “Impact of The Recent General Election on the Real Estate Industry”, organised by the International Real Estate Federation Malaysia (FIABCI-Malaysia), Yeoh said a more clearer political picture was expected after the UMNO General Assembly in December and this will result in a relatively more stable property market.

 

 

He, nevertheless added there was no sign yet of a slowdown in the foreign investments.

 

Whatever the changes, the basic policies are expected to remain same, he said, adding that the local property market will continue to be boosted by domestic demand.

 

“I dont think domestic demand would slow down, I think that would continue to be strong,” he added.

 

Yeoh also said a more influencing factor was the global economic situation rather than Malaysian politics as the US subprime crisis was far from over and that it may have impact on global liquidity.

 

On a positive side, he said Malaysian economy was well preserved by domestic consumption which was robust.

 

ASLI has forecast a gross domestic product growth of between 5.8 per cent and 6.2 per cent this year amid robust domestic demand, and exports of its oil and gas and palm oil.

 

Meanwhile, Glomac Bhd’s group executive vice chairman, Datuk Richard Fong, was also upbeat on the high-end property market. He said: “I think the property sector will remain stable and we will see a surge of foreign investments for properties especially in the high-end market, mainly from the Middle East.”

 

Bukit Kiara Properties Sdn Bhd’s group chairman Datuk Alan Tong Kok Mau meanwhile said there was still a lot of growth potential for the high-end property market, saying that Malaysia’s property prices still remained very competitive.

 

“There is still a niche market for the high-end segment and we would focus on that. Towards the year, we would see demand mainly from the Middle East and China,” he said.

 

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MALAYSIA'S property sector will continue to attract foreign investors, especially the high-end segment, despite the recent changes in the local political landscape, Asian Strategy & Leadership Institute (ASLI) chief executive officer Datuk Dr Michael Yeoh said yesterday.

 

However, the foreign investors are bound to adopt a “wait and see” attitude for now until the political scenario is much more clearer, he said.

 

The wait-and-see attitude is more likely to affect the high end properties that depend on foreign purchases like those in the KLCC areas or those above RM2,000 per sq ft.

 

Presenting a talk in Kuala Lumpur yesterday on the “Impact of The Recent General Election on the Real Estate Industry”, organised by the International Real Estate Federation Malaysia (FIABCI-Malaysia), Yeoh said a more clearer political picture was expected after the UMNO General Assembly in December and this will result in a relatively more stable property market.

 

He, nevertheless added there was no sign yet of a slowdown in the foreign investments.

 

I dont believe him.

Of course Foreign investors are slowing down. They have less access to bonus money, and less credit.

It is inevitable that they will slow purchases in Malaysia.

 

And I think the local market is farr too small to absorb all the new luxury condo under construction

 

He is sounding an early warning, and should be more honest about it- and tell developers to BE CAREFUL.

The way the system works in MY is highly dangerous, the 2-3 yearl lock-up during construction means that the

market will be slow to reflect a slowdown in demand, because those who want to sell will simply have to wait

until completion. To me, that suggests that we may see a big glut in MY about 1-2 years from now.

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Am I correct in thinking that Malaysia, is one of the few Asian countries where its possible to hold the property deeds as a non-resident foreign national? Anyone know any other spots in Asia where non resident foreign nationals are able to own property in their own name and in addition have a transparent legal system? :blink:

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Am I correct in thinking that Malaysia, is one of the few Asian countries where its possible to hold the property deeds as a non-resident foreign national? Anyone know any other spots in Asia where non resident foreign nationals are able to own property in their own name and in addition have a transparent legal system? :blink:

 

 

 

Yes you can own property in Malaysia as a foreigner, I think it is the only country in SE Asia where this is the case, although I think I am right saying there are some rules in Singapore about owning leasehold property as a foreigner.

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Tend to agree with your views Dr Bubb, no doubt this bloke has a vested interest !

 

In my experience, everyone in Malaysia has a 'vested interest'. The whole place is one big vested interest.

 

I did love working there for a few months in 2005, but I really did get to see how the place worked.

 

The major problem that Kuala Lumpur has is simply sheer volume of traffic. Petrol being state subsidised by the government, means that there are a lot of cars and yes, it does have a good monorail system, but getting around is a major hassle.

 

Other than being driven to and from work by our driver, I walked everywhere else within the main city centre, as car travel did my head in, also inhaling tons of benzine in the five o'clock shovew to Bangsar is not my idea of fun.

 

Kuala Lumpur as a city reminded me of Birmingham (UK) with palm trees and a high level of humidity. And yes I did like it.

 

Penang/ Georgetown I thought was sweet, a nice city. Malacca was an interesting place although a bit too small. The East coast was beuatiful, but very conservative in parts.

 

Overall I felt that Malaysia was a country with an excellent future, in parts very beautiful, very controlled, a strong sense of government (and government control).

 

Would it be a good place to invest in? Within reason yes. Most people I met there hada good sense of values and were decent. I'd love to go back there for an extended visit again.

 

 

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