Property in Malaysia any good ?
April 23rd, 2008 | by winsonlee |
VS
There are still much opportunity in Malaysia when comes to property. Property in Malaysia performs better because of the low interest rate and high rental return. To obtain a positive cash flow rental in Malaysia, a deposit of $86,666 is required to purchase a $333,333 (RM 1,000,000) retail office. The retail office is able to rent out for RM4,800 that gives a return of 5.76%/ year. Compare with the property in Australia that uses $87,000 as the deposit, a loan of $348,000 with monthly repayment of $2,893 needs to be obtain to purchase a house. The house is able to rent it out for $1,500 and it gives a rental return of 4.14%/year. With monthly repayment of $2,893 and rental income of $1,500, you still needs to fork out $1,393 from your own pocket for the mortgage. Do take note that for property in Malaysia, with 26% deposit, the rental itself is able to cover the monthly repayment for the mortgage. Which investment you should go for is really depends on how soon you would want to start a family. If you considering starting a family within a year or two time, then of course getting a house is unavoidable as it is better off to buy a house then renting one.
2 Responses to “Property in Malaysia any good ?”
By lalala on Apr 29, 2008 | Reply
I am not sure where u got this property article for malaysia but I am sure a lot other properties here fetch a better yield than this. Averaging 6-8%. The challenge is not buying and owning it but lies in getting an anchor tenant and the need to maintain it. Besides if you really rent it out then, the contract will be stamped by the revenue tax dept in malaysia and they will chase after you for tax revenue. Last but not least, title search needs to be conducted before buying a property in malaysia. A lot of foreigners has been conned buying non-existing land or fake titles of the property. Easier said than done my friend.
By winsonlee on Apr 29, 2008 | Reply
I am comparing a specific property that gives me the information that I am looking for. The owner of the Plaza Hartamas is actually looking for people to buy at the price of $1,000,000 or renting it out at the price of $4,800. This gives the rental return of 5.76%. As my article is favorable to property in Malaysia, usually I will use example for the worse case scenario in Malaysia compare with the best case scenario in Melbourne. Through this comparison, in any circumstances, I can say that Malaysia is a better place to invest compare to Melbourne. In Melbourne, the rental yield is usually less then 4%.
Some owner do sell the shop that already has an existing tenant. Although the price might be slightly higher then the normal market rate, but at least you know that your investment is guaranteed although you are getting a lower rental yield. The most important factor is the LOCATION of the property.