Anyone have experience in this market. A good mate of mine wants me to go into a few deals with him. Need a bit of feedback
Hi there Yorker, I am here in Malaysia at the moment. Have been since March. I do know that rentals are high. There is a two story house near where I live that is available for rent. It costs RM15000 ( $5669 AUD ) per month. In Oz the house would be something like 350 to 450 per week ( guesstimate ). And it needs major work to make it livable.
To get a “good deal” you would have to lower yourself to the extreme. I thought about it, but the prices are just too much for me.
By the way $ 1 AUD = RM2.65
Cheers
“Looking forward to the day when I can tell the boss where to go”
Yorker,
Any details on the deals being offered ?
ie..what are they..apartments, hi rise, location ?
Is your friend a Malaysian national.I looked at something similar in Indonesia…the land was leasehold, cheap to do but the risk was high.
The term that comes to mind is “Soverign Risk” ( thats the one the lawyer used)Be careful,
KPYorker… all I would say is :
DON’T DO IT…….
If you are not Malay, then you are at a disadvantage ALWAYS in Malaysia….
Quality of buildings is NOT good at all, They don’t even know what maintenance means at all……
It’s just not worth the risk……
Unless well established financially [prepared to lose your investment], with value-add/successful contacts/JV partners in Malaysia, then this is a very high risk market.
Given the risks involved – short or long-term investment strategy, Australia and/or New Zealand should be far more rewarding.
— Michael
Thanks guys. My mate is indeed a Malaysian national (met him at boarding school in Sydney). I’m looking at commercial projects mainly.
How is the property market travelling over there, just in case I look at a bit of reso?
Yorker – “You’ve Got Mail”
“Looking forward to the day when I can tell the boss where to go”
Yorker,
In general many commercial buildings in Malaysia are in a state of disrepair. Maintenance is rarely done….
If it is a close friend then, you will be better off, but, if you are serious about this, then, a visit to Malaysia ( I’m assuming KL ? ) is a MUST, to see for yourself….
“My mate is indeed a Malaysian national”
To reiterate my earlier point, the fact that your potential partner is a Malaysian alone means very little. In order to reduce your risk, it is advisable to partner with an individual well established in this market, with a successful track record and reputable network.
“How is the property market travelling over there”
I would think this is a question you should be asking your friend. If you do not trust his feedback then you need to add this to the list of risks.
Don’t mean to sound negative, but you are considering a market we researched several months back and declined to enter for many reasons – the most prominent being, Australia and New Zealand offered greater return on investment potential for far less risk.
— Michael
Thanks. I’m going to proceed with great caution and am planning to visit the region in early Jan 2005.
I have properties in Malaysia and Australia.I must say that Oz props have performed extremely well the last few years.
I wish to correct the above inaccurate comment. A double storey house does not rent for RM15,000 but only about RM1500/month.The average is a 4% return whereas in Melbourne, I would look at 8%.
However,the game is played differently over here.
You need to buy new developments to get capital gains.There is no value to buy second hand props.
look for properties launched by famous developers. As the roads are build, the prices will jump by the thousands.By the time,the whole infra is in, roads, supermarkets.. your new house will be worth a lot more.A typical development can launch 100-500 units (houses)and you can imagine that the takeup is never so hot as it is all off-the -plan development. A visit to the site is a dismay as it is all bushes and mud roads.So if you pick up the investment then,it should always be lower.It takes 2 years to build so prepare for a long wait and to pay progresive payments.By the time,it is finished,normally there are buyers who will see a finished project where they are on tar roads and all the props are freshly painted and landscaped.Thus they will shop and pay you a higher price for your pain and your initial risks.
If you need information for loans and foreign investment,please PM me.Hi all
i don’t consider myself any type of expert at all on Malaysia , but i was talking to someone from Malaysia a few weeks ago and he mentioned that unlike Australia and NZ this market doesn’t have all the support systems we take for granted, like property managers etc. His advice folowed what has been said already and added that it would be incredibly difficult being an absent landlord in this market.
regards westan
I live in New Zealand and for a fee find cash positive deals there, email me at [email protected] to join our database
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