Page 2 of 2 FirstFirst 12
Results 16 to 29 of 29

Thread: 1997 --> 2007 --->> 2017

  1. #16
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    Visited a uni mate of wifey in the little red dot...

    They live in a landed house in bukit timah and rent out their previous house (a private condo, not HDB unit).

    Ask them why not sell the private condo ?? They said if they sell now, it is like just break even, the annualised ROI is worse than cpf dividend !!
    Chinese tea is good, lager beer is better, 香檳 is the best..

  2. #17
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    I think cash flow is really the showstopper for property buyer as developers are coming out with all kind of interesting ideas to help buyer to "reduce" the initial sum required to purchase a property.

    Recently, I went to a property sales office and registered my interest, the staff gave me a piece of document with all sorts of "rebates and discounts", something which I haven’t seen before. (maybe common to those who are active in buying/flipping property but not for me…)

    Let say, property price is RM900,000

    The standard down payment is 10% which is RM90,000

    The developer offers the following “rebates” to hep reducing the down payment.
    - 3% rebate if signed SPA within 30 days (RM27000)
    - 1% new customer discount (RM9000)
    Total rebate is RM36,000

    Also, the developer absorbs the legal fee for SPA and stamp duty for MOT (memorandum of transfer) on top of the free legal fee and stamp duty for loan agreement !!

    Stamp duty for MOT :
    - 1% for 1st 100k = RM1000
    - 2% for next 400k = RM8000
    - 3% thereafter = RM12000
    Total stamp duty : RM21000

    Legal fee for SPA :
    - 1% for 1st 150k = RM1500
    - 0.7% for the remaining = RM5250
    Total legal fee : RM6750

    Total savings from stamp duty and legal fee = RM27,750

    Now, the developer has managed to reduce the initial lump sum as much as RM63,750 for the buyer !!

    Of course, all these are not free. The so-called rebates and discounts have been factored into the house price. From the buyer point of view, they don’t mind the house price has been inflated because bank will still use the selling price from developer as basis for loan financing. Their problem is initial lump sum. Higher loan amount is a problem which can be spread over 25 years, some even 35 years !!

    Really WTF...
    Chinese tea is good, lager beer is better, 香檳 is the best..

  3. #18
    Join Date
    Mar 2006
    Location
    USJ
    Posts
    2,524
    I visited a housing project site in Shah Alam. The Developer is offering the same kind of deal. They have to be creative to sell in trying times.
    " In the land of the blind the one-eyed-jack is king."

  4. #19
    Join Date
    May 2004
    Location
    Wild2West
    Posts
    18,782
    Quote Originally Posted by opulant View Post
    I think cash flow is really the showstopper for property buyer as developers are coming out with all kind of interesting ideas to help buyer to "reduce" the initial sum required to purchase a property.

    Recently, I went to a property sales office and registered my interest, the staff gave me a piece of document with all sorts of "rebates and discounts", something which I haven’t seen before. (maybe common to those who are active in buying/flipping property but not for me…)

    Let say, property price is RM900,000

    The standard down payment is 10% which is RM90,000

    The developer offers the following “rebates” to hep reducing the down payment.
    - 3% rebate if signed SPA within 30 days (RM27000)
    - 1% new customer discount (RM9000)
    Total rebate is RM36,000

    Also, the developer absorbs the legal fee for SPA and stamp duty for MOT (memorandum of transfer) on top of the free legal fee and stamp duty for loan agreement !!

    Stamp duty for MOT :
    - 1% for 1st 100k = RM1000
    - 2% for next 400k = RM8000
    - 3% thereafter = RM12000
    Total stamp duty : RM21000

    Legal fee for SPA :
    - 1% for 1st 150k = RM1500
    - 0.7% for the remaining = RM5250
    Total legal fee : RM6750

    Total savings from stamp duty and legal fee = RM27,750

    Now, the developer has managed to reduce the initial lump sum as much as RM63,750 for the buyer !!

    Of course, all these are not free. The so-called rebates and discounts have been factored into the house price. From the buyer point of view, they don’t mind the house price has been inflated because bank will still use the selling price from developer as basis for loan financing. Their problem is initial lump sum. Higher loan amount is a problem which can be spread over 25 years, some even 35 years !!

    Really WTF...
    As far as I know, most developers in Boleh are going through rough times and this is one of the ways to make investment attractive.

    This is also reflected in most Bursa shares that dwell into development in Boleh.

    In Western Australia, we also have such problem and for many years, the Government gives at least AUD10,000.00 for all First Home Buyer.

  5. #20
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    I have a good buddy who was retrenched about a year ago from middle east. Although he is quite comfortable financially after decades of hard work in the desert but I know he is also worried of his property "investment"

    He once asked me whether I'm interested to buy one of his properties. It is a bungalow near Country Height in Kajang. He bought from developer 6 years ago at RM1.7 million. He wanted to sell at 2.5 but market price is less than 2.1

    His loan monthly instalment is RM10k. One year is RM120K. The total money paid to loan instalments for the past 6 years would be RM720k !!

    I'm not sure whether he has used his savings to reduce the loan principal amount. If he didn't, all the RM720k will go to loan interest only.. Even he can sell the property at RM2.5 million, he still sell at a loss !!

    Scary, isn't it ?
    Chinese tea is good, lager beer is better, 香檳 is the best..

  6. #21
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    Quote Originally Posted by Henry T View Post
    I visited a housing project site in Shah Alam. The Developer is offering the same kind of deal. They have to be creative to sell in trying times.
    I guess "everybody" is happy with such creative ways :
    - developer is happy as property can sell
    - buyer is happy as they can now "afford" to buy house
    - government is happy as more income from stamp duty
    - lawyer is happy with more property
    transactions...

    As I said, the problem is being passed to the longer time frame. That's why the domestic household debt now is 87%
    Chinese tea is good, lager beer is better, 香檳 is the best..

  7. #22
    Join Date
    Mar 2006
    Location
    USJ
    Posts
    2,524
    There are some unsold units at The Olives Subang Jaya on offer with free lawyer fee + free stamp duty. It is sold through property agents by distributing flyers.

    The price is RM 460 per sq ft with the smallest unit on offer at 1781 sq ft. That's RM 819k. The buyer probably have to put in at least RM200k of renovations.
    " In the land of the blind the one-eyed-jack is king."

  8. #23
    Join Date
    May 2004
    Location
    Wild2West
    Posts
    18,782
    Quote Originally Posted by Naka View Post
    As far as I know, most developers in Boleh are going through rough times and this is one of the ways to make investment attractive.

    This is also reflected in most Bursa shares that dwell into development in Boleh.

    In Western Australia, we also have such problem and for many years, the Government gives at least AUD10,000.00 for all First Home Buyer.
    The other incentives are quite similar as Boleh.

    Slowing off-the-plan apartment sales to foreign buyers in Sydney have forced developers to mount a stamp duty discount strategy to attract more buyers.

    http://www.afr.com/real-estate/devel...0170801-gxn9ij

    Others

    Developer pledges $50,000 “handouts” [ OLD NEWS ]

    http://www.ratecity.com.au/home-loan...0-000-handouts


    ===
    Developers offer to pay stamp duty, furniture and rent to sell apartments

    A mystery shopping trip to buy an apartment has uncovered a top tier developer offering a whopping $59,400 discount on a $495,000 apartment, about 12 per cent of the purchase price.
    The mystery home buying spree conducted by researchers at investment bank Citi revealed one large developer giving new apartment owners a 5 per cent 12-month rental guarantee and paying the $25,000 stamp duty bill on a $495,000 one bedroom unit.

    https://www.brisbanetimes.com.au/bus...23-gwx1gt.html
    ===

  9. #24
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    With all these "incentives" from developer, who want to buy from sub-sale market ??

    From the example in post#17, property price is RM900k

    Buy from developer
    - down payment is RM54,000 (RM90,000 minus rebates of RM36,000)
    - free legal fee and stamp duty for SPA
    - free legal fee and stamp duty for loan agreement

    Total initial cash required = RM54,000


    Buy from sub-sale market
    - down payment = RM90,000
    - legal fee and stamp duty for SPA = RM27,750
    - legal fee and stamp duty for loan agreement (assume 70% financing) = RM9,900

    Total initial cash required = RM127,650


    and from what I observe about malaysian buyers (generally speaking), those who can afford to have RM127,000 cash up-front will not buy a RM900k property, they will look for RM1.5 million++ property...

    at the end, bank always win...
    Chinese tea is good, lager beer is better, 香檳 is the best..

  10. #25
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    Quote Originally Posted by Henry T View Post
    There are some unsold units at The Olives Subang Jaya on offer with free lawyer fee + free stamp duty. It is sold through property agents by distributing flyers.

    The price is RM 460 per sq ft with the smallest unit on offer at 1781 sq ft. That's RM 819k. The buyer probably have to put in at least RM200k of renovations.
    There are quite a number of sub-sale units from Isola Subang Jaya which is nearby the Olives SJ. Isola is a luxury condominium developed by Sime Darby. I noticed almost all selling price are above RM800/sqft !!

    Few years ago, I went to the Isola show unit after about one year it was launched and was told all units sold out !! Bear in mind, most condo in Isola are relatively big units (around 1500/1700 sqft) and some units are above 2000 sqft. I believe many purchasers bought for "investment"...

    I guess those who bought for "investment" 3-4 years ago likely fell the pinch now.
    Chinese tea is good, lager beer is better, 香檳 is the best..

  11. #26
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    Quote Originally Posted by opulant View Post
    at the end, bank always win...
    I think for most people who have bought property before, they can understand the negative impact of compounding interest over a long period of time. Young people who haven't bought a house before likely can't visualize how their money all ended up as interest to the bank !!

    People nowadays are so lucky, you can get it free from Internet. Here is one example..
    http://www.calculator.com.my/home-lo...r#.WeiVN8xrxI8

    I derived a similar tabulation myself using Excel spreadsheet when I bought my 1st house. This was almost 30 years ago and it helped a lot ..

    Using the loan calculator, let say a young fella in the early 30s, borrow RM450,000 for 35 years. If he doesn't reduce the loan principal sum, the total interest paid at the end of 35 years is RM415,000 and this is based on current low interest rate of 4.25% !!

    Interest for housing loan won't stay so low forever. As a rule of thumb ---> for every RM1 of your house loan, the interest is RM1.50. In other words, you have to pay RM2.50 to the bank for every RM1 of your housing loan at the end of the day.

    When interest is low (like the current interest rate), the factor is around 0.9 to 1.1. Once the interest rate is above 6.5%, factor 1.5 is the norm !!
    Chinese tea is good, lager beer is better, 香檳 is the best..

  12. #27
    Join Date
    Mar 2006
    Location
    USJ
    Posts
    2,524
    Yep, the bank interest is pretty scary.

    Isola properties for sale.

    https://www.iproperty.com.my/sale/se...ntial/?q=Isola
    " In the land of the blind the one-eyed-jack is king."

  13. #28
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    These are sub-sale units. The buyer need to fork out substantial amount of initial cash.

    RM150,000 is minimum cash up-front if the selling price is more than RM1 million. I don't know how these units can sell in Subang Jaya ??
    Chinese tea is good, lager beer is better, 香檳 is the best..

  14. #29
    Join Date
    Nov 2016
    Location
    豐平峽
    Posts
    726
    For high-rise condo, it is not advisable to buy sub-sale unit unless you know the place very well.

    The biggest problem for high-rise property normally happens after the expiry of the defect warranty period (24 months after completion). Some 1st hand buyers bought the unit for investment and if they can't rent out the unit, any hidden problems will not be noticed until the next buyer live there. By the time the 2nd buyer moves in, the defect warranty has lapsed and problems can be very difficult and costly to rectify. Worse is the buyer renovate/furnish the unit extensively without knowing the hidden problems.

    If you really like the area and want to buy a unit from sub-sale market, buy unit which has been occupied by owner/tenant for a few years.
    Chinese tea is good, lager beer is better, 香檳 is the best..

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •