Property News

[xebay11]

I know of one investor who was sales manager in a small property developer. As a staff and a "datuk" he was given massive discounts of up to 30%. He snapped up 10+ propereties and now when its TOP, he has a hard time repaying his relatives and friends as his monthly instalment of RM 30000 is easily 5-6 times his meagre salary.

Wah that bad? Even if he sell at 30% below market price for new project, no takers? Then those who did not get the discount immediately loss 30% .

 

[Tekkun]

Sgcount has to decide if $250k is small change, you would not like to put $250k into a piggy bank and later take out $150k.

I think at this moment he cannot sell his project as it is still under construction. He would need at least until it is completed. Developers do not like change of buyers midway. So we are talking about 1 to 2 years away and that is a long time. No point speculating now.

 

[sgcount]

You can try selling in this market to go through the pain and hassle. You have to take losses (lost of capital and opportunity cost), pay lawyers, agents, banks for processing the contracts and cancellations etc. There should be quite a bit of travel through the customs to settle the paper work and payments.

I don't have condos in JB. Many people here do buy for own use or have long term plan to sell. The good thing about properties in JB is the low price and proximity, which gives many lower and middle class the opportunity to experience their dreams of a private property. There is a good chance that once your condo TOPs in 2-3 years' time, you might have second thoughts about selling if you have not owned any private property in Singapore before and your financial situation improves.

Actually, I can't sell now. When I mentioned to give up, I mean dump it. Cut immediate loss. All my previous deposits will be forfeited and I will incur some extra charges on the paperwork.

Even if I am allowed to sell on the market, I am 100% sure no one wants it after I reduce the price by 30%. The property market in Iskandar is really that bad. There are tons of units still unsold now.

Even those very few projects which have recently been completed, selling them off is close to impossible. Rental is low and dismal.

So that's why I projected when the tens of thousands of new ones appear in 2-4 years time, it's going to get a lot worse. The "doom and gloom" news we often hear about Iskandar is not exaggerated.

People often slam the netizens and even the SG government and media for painting such a bleak picture about Iskandar. But if you read carefully, I don't think they have done that. They are warning people that it is the RESIDENTIAL properties in Iskandar that buyers have to be wary about. They did not say Iskandar will not progress or it's a failure.

However, having all those new amenities and offices coming up does not mean the rental investment or property market there will boom. Cos ultimately, it's still the hard figures/data that will reveal the truth. I read not too long ago someone compile a list of condos in Iskandar: Puteri Harbour, Medini, Bukit Indah, old JB, Danga Bay that will be ready from 2013-18. There are altogether 84 projects! I didn't bother counting the total number, but it's definitely some 60,000 or more condo units by 2018. That's a super huge supply in a short time.

I think the SG government knows that many Singaporeans have gone in there in the hope of renting them out or for capital appreciation, given that they are unqualified to dabble in SG properties due to the cooling measures. Even the UMNO guy came out to say Iskandar has never been targeted for residential investment. Their main aim is for offices and corporations to be there. And I quote roughly, he said: "If investors want to come and buy up properties in Iskandar, that's their choice. It's the risk they want to take and we can't stop them. We didn't plan Iskandar to be for residential purpose." If their own Malaysian officials are not optimistic or show support for such residential investments, I think it says a lot about the gloomy outlook of Iskandar properties for investment.

About the part on "low price and proximity", I can only agree that those who bought it during about 2010 or earlier, that's true. One of the mistakes I made was back in 2013. There was so much report on Iskandar being the "darling" of investors in Singapore. That was also the year the SG government introduced more cooling measures. We were shut out and I remember wanting a bite of the Iskandar pie. But I didn't do enough homework to check on the prices, future rental capability, etc.

My Malaysian friends told me the price I bought and prices now have all been super inflated. It's not something their own people will even consider. Such properties are for foreigners to play with. Their locals won't touch them. Indeed, RM800k for eg, for a large 2-bedroom condo is impossible to get in SG. Sounds cheap to us. But to their locals, it's way overpriced. A landed property bought in 2010 or before that cost like what... RM200+k? It's low risk.

The question is, who's going to buy a RM800k condo say 5 years from now for say RM1 million (assuming RM200k capital appreciation which I highly doubt)? Even if it is sold at cost RM800k, people will not bother taking a look when there are thousands others selling, and there are newer ones coming up costing the same or even slightly cheaper.

Proximity-wise, they always advertise Iskandar as 15 minutes from CIQ. That's misleading of course. The whole drive, including the frequent jams, could typically take 1.5 hr on average to be safe?

Ok.... The above is just an "academic" discussion. I'm not complaining or anything. Just having a "coffee shop" discussion. Please share if you have your views.

Hopefully, those who haven't bought will learn from my experience and make your own careful decision. Or those who have bought mainly as an investment, you should perhaps start considering where you should be heading now....

 

[sgcount]

But do not be lulled into false security, the property is still a ticking time bomb and you may be just be delaying the inevitable, still have to consider bad tenants, break-in while the unit is vacant and deteriorating maintenance. If sgcount could at least move there at least he can enjoy the place and treat it like buying a car.

"Ticking time bomb" and "Delaying the inevitable"..... Well-used phrases!

Yes, those who bought your Iskandar condos mainly for investment, they are valid descriptions if you haven't started working out your maths.

That's why I'm thinking, should I lose $50k now, or face the possibility of losing another $50k (Total: $100k) in 4-5 years time?

Ok, robbery and deteriorating maintenance aside, it's more about trying to make sense of how one's money will grow or die away.

I appreciate the ideas and suggestions "bouncing" around from all of you. They've given me a better perspective of what I should consider before making the big decision.

One should not dabble in Iskandar properties unless you're staying there yourself or you can accept the risk of making a huge loss by not being able to take back your money.

$250k sounds like manageable to many here to let go. But unfortunately for the commoner me, that's a hefty sum and it can be put to other use, strictly from an investment point of view. (Actually, including the bank interests,etc all in, it's not just $250k. It should be about $400k or so I think....)

 

[Tekkun]

Actually, I can't sell now. When I mentioned to give up, I mean dump it. Cut immediate loss. All my previous deposits will be forfeited and I will incur some extra charges on the paperwork.

Even if I am allowed to sell on the market, I am 100% sure no one wants it after I reduce the price by 30%. The property market in Iskandar is really that bad. There are tons of units still unsold now.

Even those very few projects which have recently been completed, selling them off is close to impossible. Rental is low and dismal.

So that's why I projected when the tens of thousands of new ones appear in 2-4 years time, it's going to get a lot worse. The "doom and gloom" news we often hear about Iskandar is not exaggerated.

People often slam the netizens and even the SG government and media for painting such a bleak picture about Iskandar. But if you read carefully, I don't think they have done that. They are warning people that it is the RESIDENTIAL properties in Iskandar that buyers have to be wary about. They did not say Iskandar will not progress or it's a failure.



Hopefully, those who haven't bought will learn from my experience and make your own careful decision. Or those who have bought mainly as an investment, you should perhaps start considering where you should be heading now....

A logical approach. Just sit tight and wait it out. No point having sleepless nights as it has to wait till completion.

Actually there's another way if you insist to sell. If there is a willing buyer and you being the willing seller for a price to take over an uncompleted unit, you can do it through a Deed of Assignment. I leave that to the legal people.

 

[Frodo]

Actually, I can't sell now. When I mentioned to give up, I mean dump it. Cut immediate loss. All my previous deposits will be forfeited and I will incur some extra charges on the paperwork.

Even if I am allowed to sell on the market, I am 100% sure no one wants it after I reduce the price by 30%. The property market in Iskandar is really that bad. There are tons of units still unsold now.

Even those very few projects which have recently been completed, selling them off is close to impossible. Rental is low and dismal.

So that's why I projected when the tens of thousands of new ones appear in 2-4 years time, it's going to get a lot worse. The "doom and gloom" news we often hear about Iskandar is not exaggerated.

People often slam the netizens and even the SG government and media for painting such a bleak picture about Iskandar. But if you read carefully, I don't think they have done that. They are warning people that it is the RESIDENTIAL properties in Iskandar that buyers have to be wary about. They did not say Iskandar will not progress or it's a failure.

However, having all those new amenities and offices coming up does not mean the rental investment or property market there will boom. Cos ultimately, it's still the hard figures/data that will reveal the truth. I read not too long ago someone compile a list of condos in Iskandar: Puteri Harbour, Medini, Bukit Indah, old JB, Danga Bay that will be ready from 2013-18. There are altogether 84 projects! I didn't bother counting the total number, but it's definitely some 60,000 or more condo units by 2018. That's a super huge supply in a short time.

I think the SG government knows that many Singaporeans have gone in there in the hope of renting them out or for capital appreciation, given that they are unqualified to dabble in SG properties due to the cooling measures. Even the UMNO guy came out to say Iskandar has never been targeted for residential investment. Their main aim is for offices and corporations to be there. And I quote roughly, he said: "If investors want to come and buy up properties in Iskandar, that's their choice. It's the risk they want to take and we can't stop them. We didn't plan Iskandar to be for residential purpose." If their own Malaysian officials are not optimistic or show support for such residential investments, I think it says a lot about the gloomy outlook of Iskandar properties for investment.

About the part on "low price and proximity", I can only agree that those who bought it during about 2010 or earlier, that's true. One of the mistakes I made was back in 2013. There was so much report on Iskandar being the "darling" of investors in Singapore. That was also the year the SG government introduced more cooling measures. We were shut out and I remember wanting a bite of the Iskandar pie. But I didn't do enough homework to check on the prices, future rental capability, etc.

My Malaysian friends told me the price I bought and prices now have all been super inflated. It's not something their own people will even consider. Such properties are for foreigners to play with. Their locals won't touch them. Indeed, RM800k for eg, for a large 2-bedroom condo is impossible to get in SG. Sounds cheap to us. But to their locals, it's way overpriced. A landed property bought in 2010 or before that cost like what... RM200+k? It's low risk.

The question is, who's going to buy a RM800k condo say 5 years from now for say RM1 million (assuming RM200k capital appreciation which I highly doubt)? Even if it is sold at cost RM800k, people will not bother taking a look when there are thousands others selling, and there are newer ones coming up costing the same or even slightly cheaper.

Proximity-wise, they always advertise Iskandar as 15 minutes from CIQ. That's misleading of course. The whole drive, including the frequent jams, could typically take 1.5 hr on average to be safe?

Ok.... The above is just an "academic" discussion. I'm not complaining or anything. Just having a "coffee shop" discussion. Please share if you have your views.

Hopefully, those who haven't bought will learn from my experience and make your own careful decision. Or those who have bought mainly as an investment, you should perhaps start considering where you should be heading now....

I believe low price is relative to Singapore prices, and given that we can only buy above RM500K in JB, that is our game rules which we have to abide by. I dunno if locals will really shun the condos as I heard from my agent that many locals also bought KSL@Daya. Of course I am in no position to verify that. Who knows maybe there are locals who are sick of living in landed and prefer condos for the facilities?:p

As for proximity it really is true that distance wise it is near. And for some fortunate people who have flexi work hours the travel time is really "as advertised", but I supposed majority of us are the slavish working class who must be counted among the masses in the peak hour jams. :(

But my thinking is this, if you have bought just one property which I gather is the case, I feel it is keepable. Having stayed in JB for more than a year my view is that it is not all doom and gloom, especially for those who bought one property and can finance it. I am sure you bought a condo project that you personally liked, right? And you chose the unit and floor etc, and at least considered a few other condo projects before deciding on the current one, right? Thus I wouldn't write it off now because I am still paying for an asset I wanted and chose. I am not paying for something that nobody want. And it is still an asset with my name on it.

 

[sgcount]

A logical approach. Just sit tight and wait it out. No point having sleepless nights as it has to wait till completion.

Actually there's another way if you insist to sell. If there is a willing buyer and you being the willing seller for a price to take over an uncompleted unit, you can do it through a Deed of Assignment. I leave that to the legal people.

No, to dump it immediately no need to wait till completion. Basically the unit will be returned to developer. I guess they will love this situation. They keep the money and get back the unit for free. Can re-sell it.

I was told by the lawyer handling my purchase that even if I can find a buyer, I cannot transfer name like that. So I'm not sure how the Deed of Assignment works.

Anyway, I did try to sell at loss. Nobody wants!

 

[xebay11]

I believe low price is relative to Singapore prices, and given that we can only buy above RM500K in JB, that is our game rules which we have to abide by. I dunno if locals will really shun the condos as I heard from my agent that many locals also bought KSL@Daya. Of course I am in no position to verify that. Who knows maybe there are locals who are sick of living in landed and prefer condos for the facilities?:p

As for proximity it really is true that distance wise it is near. And for some fortunate people who have flexi work hours the travel time is really "as advertised", but I supposed majority of us are the slavish working class who must be counted among the masses in the peak hour jams. :(

But my thinking is this, if you have bought just one property which I gather is the case, I feel it is keepable. Having stayed in JB for more than a year my view is that it is not all doom and gloom, especially for those who bought one property and can finance it. I am sure you bought a condo project that you personally liked, right? And you chose the unit and floor etc, and at least considered a few other condo projects before deciding on the current one, right? Thus I wouldn't write it off now because I am still paying for an asset I wanted and chose. I am not paying for something that nobody want. And it is still an asset with my name on it.

There is a slight difference between sgcount and you, he paid money for the property not to stay in, at least not now, but for him to grow his money, but looks like the conditions are not favourable for growing his money so he is thinking of cutting loss now.

 

[Tekkun]

I believe low price is relative to Singapore prices, and given that we can only buy above RM500K in JB, that is our game rules which we have to abide by. I dunno if locals will really shun the condos as I heard from my agent that many locals also bought KSL@Daya. Of course I am in no position to verify that. Who knows maybe there are locals who are sick of living in landed and prefer condos for the facilities?:p

As for proximity it really is true that distance wise it is near. And for some fortunate people who have flexi work hours the travel time is really "as advertised", but I supposed majority of us are the slavish working class who must be counted among the masses in the peak hour jams. :(

But my thinking is this, if you have bought just one property which I gather is the case, I feel it is keepable. Having stayed in JB for more than a year my view is that it is not all doom and gloom, especially for those who bought one property and can finance it. I am sure you bought a condo project that you personally liked, right? And you chose the unit and floor etc, and at least considered a few other condo projects before deciding on the current one, right? Thus I wouldn't write it off now because I am still paying for an asset I wanted and chose. I am not paying for something that nobody want. And it is still an asset with my name on it.

I bought a 22ft wide terrace house in Subang Jaya, Selangor in 1992, it was RM140k then. In year 2000 which is at the height of property downturn, I wanted to buy a nicer house 26ft wide costing RM840k, my opposite neighbour said I am mad. Difference is it is a proper guarded and gated one. Still it is ridiculous price then in the same Subang Jaya township. Everyone think Sime Darby overpriced and no one will buy. More so a critical bridge linking to this housing estate is not completed yet. It even came out in papers of residents and politicians protesting against this bridge. I did my homework and went ahead.

2 years ago, the same neighbour bought a smaller unit 24ft wide costing RM 1.25m just 2 streets away from my house in the same housing estate. Today, the same type 26ft wide house is advertised for sale at RM 1.8m. I don't know what to say.

 

[sgcount]

I believe low price is relative to Singapore prices, and given that we can only buy above RM500K in JB, that is our game rules which we have to abide by. I dunno if locals will really shun the condos as I heard from my agent that many locals also bought KSL@Daya. Of course I am in no position to verify that. Who knows maybe there are locals who are sick of living in landed and prefer condos for the facilities?:p

As for proximity it really is true that distance wise it is near. And for some fortunate people who have flexi work hours the travel time is really "as advertised", but I supposed majority of us are the slavish working class who must be counted among the masses in the peak hour jams. :(

But my thinking is this, if you have bought just one property which I gather is the case, I feel it is keepable. Having stayed in JB for more than a year my view is that it is not all doom and gloom, especially for those who bought one property and can finance it. I am sure you bought a condo project that you personally liked, right? And you chose the unit and floor etc, and at least considered a few other condo projects before deciding on the current one, right? Thus I wouldn't write it off now because I am still paying for an asset I wanted and chose. I am not paying for something that nobody want. And it is still an asset with my name on it.

I'm not sure about KSL@Daya but I kay-po a bit and did ask around. For many other projects usually foreigners are the ones who bought. The prices are too high. Even if Johoreans can afford, they'd rather buy landed or stay a bit further where prices are much cheaper. And also we Singaporeans get over excited when we get good views from the condos. Many locals just want affordable homes. That's their main concern now. Good views or not will not attract them as much.

So resale-wise, the condos have a very much smaller pool of future potential buyers. Even more so worse in a large oversupply market with so much land everywhere.

You're right -- I like the condo surroundings and its design. To keep the condo means to be prepared to live there for good. Otherwise, for investment, it's not good to keep it vacant and continually lose money.

But too bad I don't have the benefit of staying there and working in SG. Yes, I've tried to plan and imagine but it's really difficult. I'm a salaried worker and like you say, we working class "slaves" (at least for me!) can't afford to be late for work. I can't call up my boss every now and then and say "Sorry, I will be at work 1 hour late because I'm stuck at the CIQ!"

 

[xebay11]

I bought a 22ft wide terrace house in Subang Jaya, Selangor in 1992, it was RM140k then. In year 2000 which is at the height of property downturn, I wanted to buy a nicer house 26ft wide costing RM840k, my opposite neighbour said I am mad. Difference is it is a proper guarded and gated one. Still it is ridiculous price then in the same Subang Jaya township. Everyone think Sime Darby overpriced and no one will buy. More so a critical bridge linking to this housing estate is not completed yet. It even came out in papers of residents and politicians protesting against this bridge. I did my homework and went ahead.

2 years ago, the same neighbour bought a smaller unit 24ft wide costing RM 1.25m just 2 streets away from my house in the same housing estate. Today, the same type 26ft wide house is advertised for sale at RM 1.8m. I don't know what to say.

Landed house Malaysian will to pay because can accommodate more people. That is why if I were to buy I will buy landed, but my timing not right now, I cannot stay in JB and commute daily. So just look around slowly, no rush.

 

[Frodo]

"Ticking time bomb" and "Delaying the inevitable"..... Well-used phrases!

Yes, those who bought your Iskandar condos mainly for investment, they are valid descriptions if you haven't started working out your maths.

That's why I'm thinking, should I lose $50k now, or face the possibility of losing another $50k (Total: $100k) in 4-5 years time?

Ok, robbery and deteriorating maintenance aside, it's more about trying to make sense of how one's money will grow or die away.

I appreciate the ideas and suggestions "bouncing" around from all of you. They've given me a better perspective of what I should consider before making the big decision.

One should not dabble in Iskandar properties unless you're staying there yourself or you can accept the risk of making a huge loss by not being able to take back your money.

$250k sounds like manageable to many here to let go. But unfortunately for the commoner me, that's a hefty sum and it can be put to other use, strictly from an investment point of view. (Actually, including the bank interests,etc all in, it's not just $250k. It should be about $400k or so I think....)

OK, if you have certain KPIs in mind when you first considered investing $250K into a condo unit and am of the opinion that it is never going to happen and you should cut it off and can immediately re-invest the remaining salvageable money into more profitable ventures, then maybe you should really do the full maths and consider dumping it, from a purely purely purely investment point of view. Then treat this as just a bad investment episode to be written of, as the level of satisfaction (or relief) you get from dumping it now is going to be much more than the satisfaction of keeping it for own use, even if you cannot rent it out.

On a side note, personally I don't have $250K to just "let go", not even $50K to actualise a loss if I choose to dump the property right now. So I would take it as a long term asset purchase for own use. Of course I am assuming that this condo unit that I am keeping is one that I like. It is miserable to finance something you don't like.

 

[Frodo]

I bought a 22ft wide terrace house in Subang Jaya, Selangor in 1992, it was RM140k then. In year 2000 which is at the height of property downturn, I wanted to buy a nicer house 26ft wide costing RM840k, my opposite neighbour said I am mad. Difference is it is a proper guarded and gated one. Still it is ridiculous price then in the same Subang Jaya township. Everyone think Sime Darby overpriced and no one will buy. More so a critical bridge linking to this housing estate is not completed yet. It even came out in papers of residents and politicians protesting against this bridge. I did my homework and went ahead.

2 years ago, the same neighbour bought a smaller unit 24ft wide costing RM 1.25m just 2 streets away from my house in the same housing estate. Today, the same type 26ft wide house is advertised for sale at RM 1.8m. I don't know what to say.

Just "um chio" can already lah!

 

[Frodo]

I'm not sure about KSL@Daya but I kay-po a bit and did ask around. For many other projects usually foreigners are the ones who bought. The prices are too high. Even if Johoreans can afford, they'd rather buy landed or stay a bit further where prices are much cheaper. And also we Singaporeans get over excited when we get good views from the condos. Many locals just want affordable homes. That's their main concern now. Good views or not will not attract them as much.

So resale-wise, the condos have a very much smaller pool of future potential buyers. Even more so worse in a large oversupply market with so much land everywhere.

You're right -- I like the condo surroundings and its design. To keep the condo means to be prepared to live there for good. Otherwise, for investment, it's not good to keep it vacant and continually lose money.

But too bad I don't have the benefit of staying there and working in SG. Yes, I've tried to plan and imagine but it's really difficult. I'm a salaried worker and like you say, we working class "slaves" (at least for me!) can't afford to be late for work. I can't call up my boss every now and then and say "Sorry, I will be at work 1 hour late because I'm stuck at the CIQ!"

Well, you can also keep it as a holiday home in the short term, spend more vacation time there. There is a whole lot of exploration to do in Malaysia, I kid you not!

Work wise, so far I have understanding supervisors and colleagues. I tell them upfront that I can be super early or super late, even one hour late. I come late I work late lor...even though it usually means longer jam at Woodlands checkpoint. But over time I have come to figure out that with reporting work time at 7.30am, if I time my leaving home between 6 to 630am I should be able to reach office between 7:15am to 8am, so either 15 min early or half hour late, still not too bad because other colleagues come in at 8am to 8.30am.

 

[Frodo]

There is a slight difference between sgcount and you, he paid money for the property not to stay in, at least not now, but for him to grow his money, but looks like the conditions are not favourable for growing his money so he is thinking of cutting loss now.

Maybe I'm naïve but somehow I see it as a mental adjustment. If "investment" is the only allowed mindset then of course one will keep thinking he is losing money on financing a product that he now dislikes simply because it is now a money sucker instead of money maker. But if he adjust a little bit and consider it as financing an asset which overtime usually appreciate (assuming he bought a condo unit that has unique selling features and he likes it) over the long term, then it is not so much about cutting losses. I still believe that unless one is a prophet, you cannot really tell the future and how things will pan out.

 

[xebay11]

Well, you can also keep it as a holiday home in the short term, spend more vacation time there. There is a whole lot of exploration to do in Malaysia, I kid you not!

Expensive holiday home, at the rate I am spending on hotel bills in MY, I think SGD250k would still have change after I am long gone LOL.

 

[potter]

if ask me to buy leasehold in jb. wait long long. :p

 

[Frodo]

Expensive holiday home, at the rate I am spending on hotel bills in MY, I think SGD250k would still have change after I am long gone LOL.

Maybe when you and I are long gone, Iskandar boom liao, then kids can monetise asset lor....hotel bills is purely sunk cost.

 

[xebay11]

Maybe when you and I are long gone, Iskandar boom liao, then kids can monetise asset lor....hotel bills is purely sunk cost.

Ha ha good wish, I hope my kids don't come to my niche and say "why you invest in JB, other place could have made much more" LOL

 

[Frodo]

Ha ha good wish, I hope my kids don't come to my niche and say "why you invest in JB, other place could have made much more" LOL

Then come back and haunt them to teach them to be grateful for the things they already have. Lol!