Push for affordable housing

JOHN, 25, is a new lawyer with a Kuala Lumpur-based legal firm and earns RM3,200 per month. He plans to get married next year, and has been looking for a “nice tiny apartment” to settle down.

After spending many weekends looking around, John says he and his wife-to-be “fell in love with a cozy little place” in Seri Kembangan – a three-bedroom apartment starting from RM460,000.

All looked set for the couple, until his loan was rejected. He had recently obtained a loan for a new car – as travelling to different states for court hearings was the norm at his firm.

This is compounded by the fact that his fiancé was recently retrenched – so it’s no surprise that money has been tight for the couple.

John says he has the resources for a 10% down payment for the apartment, but his bank is only offering an 80% loan facility.

“Because of our salaries, we were not able to come up with the remaining 10%,” he laments.

John’s situation is familiar – many first-time home buyers are struggling to purchase a home given the high cost of living.

“What would be great is the banks are able to provide a higher financing margin, like 90%,” says John.

The budding lawyer had many discussions with his partner on possible alternatives for the remaining 10% – from borrowing from friends, family or ah long.

Out of reach: The oversupply of properties costing RM1mil and above has forced developers to change their strategies.

 

Developers to ‘bridge’ the gap

For John, the recent announcement by Urban Wellbeing, Housing and Local Government Minister Tan Sri Noh Omar that eligible housing developers could apply for moneylender licences and provide loans of up to 100% to property buyers seem like light at the end of the tunnel.

For someone like John, it could also be light from an oncoming train as the interest rates will be very high, compared with commercial banks housing loan at about 4.5% to 5.5%.

The minister said developers can gain from property sales and profit from end-financing as well, while the country’s pool of potential homeowners will be widened.

The licences will be issued by the ministry under the Moneylenders Act 1951 (Amendment) 2011.

The announcement was met with mixed responses. The National House Buyers Association and some developers likened the situation to a licensed ah long, suggesting that this could lead to developers pricing their products at unsustainable prices, thus accelerating a housing bubble.

At a media briefing on Wednesday on its Property Industry Survey for the first half of 2016, the Real Estate and Housing Developers’ Association Malaysia (Rehda) president Datuk Seri FD Iskandar sought for caution as the move comes with risks.

“There are risks involved as not all developers can do this. There’s no such thing as developers who can finance 100%. Not all developers even have the balance sheet to do the 10% to 15% ‘bridge’.”

He emphasised that there is an urgent need to assist buyers, especially those within the middle-income group - like John.

The problem is that buyers get between 75% and 80% of financing. “That’s the average, we’ve checked. But someone has to come in to provide that remaining 10% to 15%, or bridging financing,” FD Iskandar says.

The Rehda survey was conducted in the first half of this year to assess market performance.

Rejection by banks for end-financing affects properties priced between RM250,000 and RM2.5mil, particularly for properties priced between RM500,000 and RM700,000 (24%). Six per cent of properties RM250,000 and below were affected and for properties RM2.5mil and above, 7%.

Because of the high loan rejection rate, FD Iskandar says lending by developers should be capped at properties below RM500,000 to assist first-time homebuyers and genuine upgraders.

Limiting it at the RM500,000-mark would also mean that the move would not see the entry of speculators which will only result in prices spiking – leaving cash-strapped end-users such as John unable to purchase property.

Following a Cabinet meeting on Wednesday, Noh said in a statement that his ministry had been asked to study the effectiveness of the developers’ money lending policy.

One industry observer says young individuals, like John, tend to look for properties that are beyond their pay-grade and should in fact go for something more affordable.

“Instead of looking for a place that they can afford, they go for something that they can’t. So they’ll end up saving and waiting for that property they’ve had their eye on.

“And by the time they can afford it, the price of that unit would have gone up even more and they still can’t afford to buy it!”

One option is to purchase a low-cost apartment or house, he says.

According to Rehda’s Property Industry Survey, a total of 1,022 units of low-cost units with a built-up area of 650 sq ft priced between RM35,000 and RM42,000 were launched in the first half of this year. None of them were sold. A year ago, 650 units were launched, of which 450 units were sold.

This does not necessarily mean that conditions are so bad that people are just not buying properties, says FD Iskandar.

“People don’t live in low-cost homes because the don’t want to be associated with them. If they can afford it, they would prefer to purchase something bigger,” he says.

Confidence factor

According to Rehda’s survey, property sales performance experienced a significant decrease to 39% in the first half of 2016 compared with 52% a year ago.

A total of 7,172 units were launched in the first half of 2016 compared with 10,829 units a year ago. A total of 2,829 units were sold in the first six months of this year compared with 4,371 units in the previous corresponding period.

Half of the residential units launched were priced below RM500,000. Serviced apartments showed a year-on-year increase in sales, rising to 267 units in the first half of 2016 compared with 100 units in the previous corresponding period.

Sales of bungalows and garden villas also recorded a significant increase, with 194 units sold in the first half of 2016 compared with just nine units in the first half of 2015.

The first half of this year also saw significantly more launches of bungalows and garden villas at 361 units compared with just 24 units in the previous corresponding period.

All states were retaining their prices except for Malacca, FD Iskandar says. The “unsold” situation was still manageable despite the decreased in sales performance.

Two- to three-storey landed units have taken over apartments in terms of launches. He says while condominiums and apartments are still available, their take-up rates have dropped.

“The days where people used to queue up are over. That’s not to say that those times will not happen again. The property sector is cyclical. The confidence level is not there.”

FD Iskandar says consumer confidence is influenced by what people see or don’t see. The sight of cranes and workers at construction gives confidence that the sector is doing well.

“What we don’t see, we don’t feel. (The scene of) construction cranes is an indicator that the economy is thriving. But because we don’t see this, it affects confidence.”

With confidence affected and potential buyers such as John having financing problems, Rehda reveals that first time buyers had dropped by 13% during their period surveyed.

First time buyers accounted for 34% of the buyers’ profile compared with 47% in the second half of 2015.

The number of upgraders however increased to 45% from 39%, while the level of investors grew to 18% from 13%. Buyers comprising companies meanwhile grew marginally to 4% from 1%.

Not all gloom and doom

This does not mean people don’t have money, says FD Iskandar.

“If you look at our gross domestic product (GDP), at 4% in the second quarter, it’s still healthy,” he says.

Malaysia’s economic growth had slowed to its slowest in seven years at 4% during the April-June quarter of 2016 from 4.2% in the preceding quarter.

According to Bank Negara, GDP growth in the second quarter was weighed down by the continued decline in net exports and a significant drawdown in stocks. Stronger expansion in domestic consumption growth was the only saving grace for the country’s economy.

FD Iskandar says people are just not spending, especially on houses which are big-ticket items.

But all is not doom and gloom, he says. Sales of properties below RM200,000 grew nearly 2½ times in the first half of 2016, accounting for 14% of total sales compared with just 6% in the previous corresponding period.

A members survey shows that 21% is optimistic about the sectorial outlook for the first half of 2017 while 11% are optimistic about the second half of this year.

“There is a lot of hope that the property market and economy will be better next year,” says FD Iskandar, adding that many developers are using various measures to boost sales.

“These include creative marketing strategies comprising freebies, aggressive participation in exhibitions, review of selling prices and easier financing or payment schemes.”

At the Asian Strategy and Leadership Institute summit in early September, Sunway REIT Management Sdn Bhd’s chief executive officer Datuk Jeffrey Ng Tiong Lip says the current slow market was short-term pain but long-term gain as prices consolidate. 

He expects a recovery in the 2017/2018 period.

“We have to look at national and global macro economy,” he says. Property consultants Savills Malaysia managing director Allan Soo expects a 2019 recovery while Jones Lang Wootton executive director Malathi Thevendren prefers not to put a time line to it. 

Whatever state the sector may be in, FD Iskandar says that there will be demand for housing as Greater Kuala Lumpur population expands from the current seven million to 10 million. There will be a need for an average of 200,000 new units from this year through 2020. “We need about 200,000 new houses per year. Last year, there were only 80,000 units,” he says.

source:  http://www.thestar.com.my/business/business-news/2016/09/17/push-for-affordable-housing/

Property Real Estate price in 2015

So what is the out look on the real estate property market? 
here are is a good read to educate yourself

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THE Penang property sector is expected to see some challenges going forward. Real Estate and Housing Developers’ Association (Rehda, Penang) chairman Datuk Jerry Chan expects another 30% decline in property transactions in 2015 from the 30% drop recorded in 2014. 

Chan says: “We expect to see little or no appreciation for high-end condominiums going forward. The mid-range high-rise properties with price tags of RM400,000 to RM500,000 are likely to see appreciation. We also expect to see lower demand for landed residential properties priced between RM3.5mil and RM5mil.” 

Another indicator of the bumpy road ahead is the high rejection rate for housing loans, which according to Rehda Penang deputy chief Datuk Toh Chin Leong is 50% for some projects. “You don’t see this three years ago, but it has been happening for the last 18 months,” Toh says.

Notwithstanding the challenges predicted by the association, there are at least 10 residential addresses in Penang where prices have appreciated substantially since 2009, unaffected by the economic uncertainties. 

Raine & Horne director Michael Geh says these addresses are not in the premier category, but are sought after because of their pricing, location and facilities.

“They have benefited from the new infrastructure, malls and other amenities that have mushroomed around them. Owners are not speculators and would not give them up unless the offer is good. This is another reason why these properties have appreciated rapidly,” Geh says.

On the island, the five addresses are Springfield Condominium in Sungai Ara, Krystal Suria in Bukit Jambul, Leisure Bay in Tanjung Tokong, Marina Tower in Relau.

In the south-west district, where the Penang International Airport is located, prices of Springfield Condominium, Krystal Suria, and Marina Tower have appreciated between 164% and 233% (see table)

In the north-east district, prices of Leisure Bayand Midlands Condo have appreciated by about 200%.

The second bridge project, announced in 2006, the construction of the Subterranean Penang International Convention and Exhibition Centre in Bayan Baru and the Penang Waterfront Convention Centre next to the Penang Bridge, have helped to boost prices. Both convention centres will be ready this year and 2017 respectively.

On the mainland in central Seberang Prai, the popular addresses are Taman Pauh in Permatang Pauh, Taman Sejahtera in Alma, Putra Bertam in Bertam, and Juru Indah in Juru. In North Seberang Prai, it is Taman Dahlia in Jalan Raja Uda.

Landed terraces in Taman Pauh, Taman Sejahtera, Putra Bertam and Juru Indah have risen between 43% and 60% since 2009.

The second bridge project linking Batu Kawan in South Seberang Prai and Batu Maung in the southern part of the island has driven up property prices located at both ends of the bridge.

Using 2006 as a benchmark, Geh says the price of vacant land has increased to between RM250 per sq ft (psf) and RM300 psf in Batu Maung from RM50 to RM60 psf. “Pricing depends on whether the land has been zoned for agriculture, commercial or residential use,” he says.

Prices for new two to three-storey terraces south of the island start from RM1.2mil, compared with about RM450,000 prior to 2006.

“New condominiums in similar locations are now priced at between RM700,000 and RM800,000, compared with between RM250,000 and RM300,000 prior to 2006, when the bridge was first announced,” he says.

Properties located in the prime locations of central Seberang Prai and south Seberang Prai have also increased significantly.

Henry Butcher Seberang Prai’s associate director Fook Tone Huat says vacant land in the area, especially those in south Seberang Prai where the second bridge is located, are between RM42 and RM60 psf, a huge jump from 2006’s RM8-RM9 psf.

Land prices in central and north Seberang Prai were then between RM20 and RM40 psf, compared with today’s range of between RM50 and RM120 psf. The increase in land prices has translated into higher property prices.

 

“New landed properties such as double-storey terraced units in south Seberang Prai are now priced between RM360,000 and RM450,000 compared with between RM150,000 and RM200,000 prior to 2006,” Fook says.

Double-storey terraces in prime locations in central and northern Seberang Prai have doubled, from RM200,000-RM270,000 to RM400,000-RM630,000.

“We are also seeing a number of life-style condominium projects being planned in Bukit Mertajam this year with prices between RM300 and RM350 psf,” Fook says.

As for the secondary or sub-sales market, double-storey terraces, depending on location, are priced between RM300,000 and RM600,000.

Aspen Group Holdings Sdn Bhd and PE Land Sdn Bhd’s plans to develop an Ikea store and the RM1bil Penang Designer Village, which also includes a RM200mil premium outlet respectively, will drive up prices further in Seberang Prai, especially those located near the second bridge.

Moving forward, Geh says south-west district properties will benefit from the state government’s plans to transform the Bayan Baru township into an international business process outsourcing (BPO) area. Two multi-storey blocks will replace the current Penang Development Corp headquarters. The 29 and 25-storey blocks will house retail and recreational facilities.

“In the north-east district, the opening of the Gurney Plaza and Gurney Paragon shopping malls respectively in 2001 and 2013 and the increase in food and beverage outlets in the Pulau Tikus and Tanjung Tokong neighbourhoods have boosted prices.

source

RE: Malaysia vs Germany

Hey guys!!

So we always seem to want to explore and learn about different types of cultures right?
I mean, how about the drinking culture that goes "ole ole!" when a  beer is raised? Sounds October fest enough to you?

Well today I have something interesting.

Lets compare between Penang and Germany is the terms of "Working style"

Here is an article to brighten up your eyes...err...work; haha!

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Why Germans Work Fewer Hours But Produce More: A Study In Culture

When many Americans think of Germany, images of WWII soldiers and Hitler often come to mind. But what many people don’t realize is that Germany is the industrial powerhouse of Europe, and is a leading manufacturer of goods for export to developing Asian nations. We don’t hear about the superiority of German engineering in Volkswagen commercials for nothing!
The economic engine of the EU, Germany single-handedly saved the Eurozone from collapse in 2012. At the same time, German workers enjoy unparalleled worker protections and shorter working hours than most of their global counterparts. How can a country that works an average of 35 hours per week (with an average 24 paid vacation days to boot) maintain such a high level of productivity?

Working Hours Mean Working Hours

In German business culture, when an employee is at work, they should not be doing anything other than their work. Facebook, office gossip with co-workers, trolling Reddit for hours, and pulling up a fake spreadsheet when your boss walks by are socially unacceptable behaviors. Obviously, in the United States these behaviors are frowned up on by management. But in Germany, there is zero tolerance among peers for such frivolous activities.
In the BBC documentary “Make Me A German“,  a young German woman explained her culture shock while on a working exchange to the UK.

“I was in England for an exchange… I was in the office and the people are talking all the time about their private things… ‘What’s the plan for tonight?’, and all the time drinking coffee…”

She was quite surprised by the casual nature of British workers. Upon further discussion, the Germans reveal that Facebook is not allowed in the office whatsoever, and no private email is permitted.

Goal-Oriented, Direct Communication Is Valued

German business culture is one of intense focus and direct communication. While Americans tend to value small talk and maintaining an upbeat atmosphere, Germans rarely beat around the bush. German workers will directly speak to a manager about performance reviews, launch into a business meeting without any ‘icebreakers’, and use commanding language without softening the directives with polite phrases.Whereas an American would say, “It would be great if you could get this to me by 3pm,” a German would say, “I need this by 3pm”.
When a German is at work, they are focused and diligent, which in turn leads to higher productivity in a shorter period of time.

Germans Have a Life Outside Work

Germans work hard and play hard. Since the working day is focused on delivering efficient productivity, the off hours are truly off hours. Because of the focused atmosphere and formal environment of German businesses, employees don’t necessarily hang out together after work. Germans generally value a separation between private life and working life.
The German government is currently considering a ban on work-related emails after 6pm, to counter the accessibility that smartphones and constant connectivity give employers to their employees. Can you imagine President Obama enacting such a policy in the United States?
To occupy their plentiful Freizeit, most Germans are involved in Verein (clubs); regularly meeting others with shared interests in their community. Common interests in Germany include Sportvereine (sports clubs), Gesangvereine (choirs or singing clubs), Musikvereine (music clubs), Wandervereine (hiking clubs), Tierzuchtvereine (animal breeding clubs – generally rabbits/pigeons) and collectors’ clubs of all stripes. Even the smallest village in Germany will have several active Vereinen to accommodate residents’ interests. Rather than settling in for a night of TV after work, most Germans socialize with others in their community and cultivate themselves as people.
Germans also enjoy a high number of paid vacation days, with many salaried employees receiving 25-30 paid days (the law requires 20). Extended holidays mean families can enjoy up to a month together, renting an apartment by the seaside or taking a long trip to a new, exciting city.

Business Respects Parenthood

Germany’s system of Elternzeit (“parent time” or parental leave) is the stuff of fantasy for most working Americans. The United States does not currently have laws requiring maternity leave, while Germany has some of the most extensive parental protection policies in the developed world. The downside of these maternity leave benefits is that employers may avoid hiring women (with the fear that they will take advantage of the extensive benefits), and German boardrooms are consistently male-dominated at a higher rate than other developed nations, although the government is working to eradicate this trend. The financial benefits of staying home (from both Elternzeit and Elterngeld or parents’ money programs) are often too good to pass up for German mothers, and can lead to stagnant or non-existent careers.
Since “at will” employment does not exist in Germany, all employees have contracts with their employer. Parents who have been gainfully employed for the previous 12 months are eligible for Elternzeit benefits, which include up to three years of unpaid leave with a “sleeping” contract. The employee is eligible to work part-time up to 30 hours while on leave, and must be offered full-time employment at the conclusion of the parental leave. Parents may also choose to postpone up to one year of their leave until the child’s 8th birthday. Either parent is eligible for parental leave, and many couples make the choice based on financial considerations.
In addition to the preservation of the employee’s contract, the state will pay up 67% of the employee’s salary (with a cap of 1800 Euros per month) for 14 months. Parents may split the 14 months however they choose. These benefits apply equally to same-sex couples.
Have you picked your jaw up off the floor yet?

Put Some German In Your Office

The German work culture is very different from the average American office, but there are certainly lessons to be learned from our German counterparts. The diligent focus Germans bring to their working life is to be admired. Separating work from play can help us lead a more balanced life; putting the phone down after hours gives us a mental break from stressing about work, and we can return to the office refreshed in the morning. When it’s time to get something done, closing Facebook and turning off push notifications helps keep our minds quiet and the flow steady. Direct conversation can lead to increased efficiency, and more clarity of communication among team members.
Americans often equate longer hours with increased production and superior work ethic, but examining the German model makes one wonder: When it comes to time at work, maybe less really is more!

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Wow, what a read right?
So after reading this...what do you think of your own working style now?
Please share below :)

source

Jack Ma: A success story of a technopreneur's perseverance and determination

Now now, lets take a break from articles and read at some inspiring wonderful stories that gives us the gooey warm fuzzy feelings inside shall we?

Today I'm sharing about an article that stumbled upon. It's the story about the super rich billionaire, Mr. Jack Ma. I think if he was an English man, he would be knighted as a "sir" but the queen of England herself! Or if he were Malaysian, I wouldn't be calling him as "Jack Ma" but maybe more of "Dato' Tan Sri Jack Ma". 

His story sorta reminds me of Malaysian's very own Jimmy Choo that had also started out his business on very humble and unassuming beginnings into a roaring success that now graces through the pages of inspiring story books for the young and young at heart alike. 

Here it is! I hope that you will enjoy it as I did. Credits to the poster (link given at the end) 

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Jack Ma – 

A Sensational Success Story of A Chinaman

 

Jack Ma made waves and became the talk of the town when he struck the bell at the New York Stock Exchange. His company, Alibaba went IPO on 19 September and it closed at a market value of US$231 billion, making Jack Ma the richest man in China. 

Jack’s story started in Hangzhou, China, a picturesque location near Shanghai. Jack had the desire to learn and perfect his English at a young age. In order to do so, Jack would offer city tours to tourists at a hotel nearby where he stayed. Jack clearly was not the brightest bulb as he failed his entrance exam twice before successfully attending Hangzhou Teacher’s Institute and graduated in 1988 with a bachelor’s degree in English.

After graduating Jack taught English at a local college for 5 years. In between those years, he tried and failed to land a job at a local KFC, a hotel and a city police. Jack was determined to set up his own business and in 1995 he started a translation company. He then got hired as a translator by a Chinese firm to recover a payment and led to a golden opportunity which landed him in the United States.

His friend in Seattle then showed him the wonders of the Internet and he wanted to use it to his advantage. He was beaming with excitement when he went home and showed his friends the Internet and his plans to use it for a business startup. Even though his ideas did not garner enough votes and support from his friends, Jack did not give up and started China Pages – an online directory for local businesses in search for foreign customers. Business failed and Jack was forced to give up the company.

He was determined to kick start another e-commerce company after his first failure and in February 1999 he founded Alibaba.com alongside 17 friends who invested in his idea. “Everyone knows the story of Alibaba as a young man who is willing to help others”, explained Jack when asked about the etymology of Alibaba.com. Jack’s business plan is the same as China Pages; helping local businesses seek foreign customers. Alibaba’s platform allowed exporters to post their products online whereby potential buyers would be able to browse through.

 
Investors came pouring in by October 1999 and a total of $5 million and $20 million were raised from Goldman Sachs and SoftBank respectively. It was an achievement for a startup company. Jack wanted to push the company’s potential further and in 2002 he proposed a plan to compete against popular e-commerce giant, eBay. With help from SoftBank, Jack developed the consumer-based site “Taobao” which means “searching for treasure” in Chinese.

Taobao was introduced in July 2003 and Jack did not charge a single cent for product advertising in its initial stages. Taobao was growing fast and earning more than eBay. Jack had started a fierce race with eBay China and it was not long after that eBay China threw in the towel and ceased its operations. eBay tried to buy over Taobao, but Jack refused their offer. He made a deal with Jerry Yang, the co-founder of Yahoo instead. The deal led him to acquire a collection of sites like Yahoo China that would help to boost and strengthen Taobao’s position in the market.

 “My vision is to build an e-commerce ecosystem that allows consumers and businesses to do all aspects of business online. I want to create one million jobs, change China’s social and economic environment and make it the largest Internet market in the world.”  

10 years after the successful introduction and expansion of Taobao’s market, the website is now one of the top twenty most-visited website around the world and has a total transaction volume of $240 billion in 2013. Taobao currently serves more than 79 million members from more than 240 countries and territories. 

Jack stepped down as CEO of Alibaba Group in 2013 and is currently the Executive Chairman of Alibaba Group which consists of nine major subsidiaries – Alibaba.com, Taobao Marketplace, Tmall, eTao, Alibaba Cloud Computing, Juhuasuan, 1688.com, AliExpress.com and Alipay.
The man made headlines everywhere in September 2014 and is now one of the most respected businessman globally.

source

With the new released budget 2015: What about affording your first home now?

Hey guys,

 

Budget 2014 just passed and i'm sure now everyone is wondering whether if an average person is able to buy a "home sweet home" right?

Well this article that I found shares a great deal of light into this matter 

This is an especially good read for first home buyers, first property purchasers, people keen on taking up a bank loan or mortgage loan or maybe thinking of refinancing?  

 

Hop on and lets get reading! 

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Budget 2015: Can You Afford Your First Home Now?

By Fiona Ho . 16 October 2014 . Budget 2015, GST, Home Loan, Home Loan Refinancing, Interest Rate, Properties

 

Among the biggest problems faced by Malaysians in recent years is the exorbitant property prices that has rendered many buyers, especially those residing in the Klang Valley, unable to afford their first home.

Nowadays, a condominium unit in prime locations such as Subang Jaya or Petaling Jaya can easily cost over RM600,000. With 4.45% interest over a 35-year loan tenure, buyers will need to fork out at least RM2,802 every month (not forgetting the 10% down payment) for the most basic unit.
Given that the mean monthly household income in Malaysia is about RM5,000, according to the 2012 findings by the Household Income Survey (HIS), it is no wonder that owning a home has become an elusive dream for many.

Statistically, property prices in the Klang Valley has been rising annually between 15% and 18% per annum. Once GST is implemented, property prices are expected to go up even more.
Infrastructure investments such as the new Light Train Transit (LRT) and Mass Rapid Transit (MRT) lines will also have an impact on property prices.

Last week, Prime Minister, Datuk Seri Najib Tun Razak tabled the 2015 Budget with aims to address the rising cost of living. Let us examine some of the measures announced and their implications on the property market at large.

Home sweet home for young couples

Married young couples between 25 and 40 years with a household income not exceeding RM10,000, can now look forward to owning their first property with the Youth Housing Scheme (YHS).
YHS, a partnership between the Government, Bank Simpanan Nasional, Employees Provident Fund (EPF) and Cagamas, offers RM200 financial assistance every month for the first two years and also 100% home loan financing, including cost of mortgage insurance (with 10% loan guarantee from the Government)

However, the property must not exceed RM500,000 and is also limited to the first 20,000 units.
Under YHS, the Government will give a 50% stamp duty exemption on the instrument of transfer agreements and loan agreements. The maximum loan period is 35 years.

This is how much you can save under YHS for a RM500,000 property:



If you are one of those who are lucky enough to secure a property under RM500,000, with 4.45% interest, over a 35-year tenure, your home loan monthly repayment will come up to RM2,116. However, you will need to fork out RM50,000 for the down payment, as without the YHS, you will only be eligible for 90% margin of finance.

With YHS, qualified applicant will get 100% financing and RM200 financial assistance from the Government for the first two years. This translates to RM2,151 monthly home loan repayment (or about 43% of an average monthly household income of RM5,000) and results in RM4,800 savings in two years, excluding the amount you save from the down payment.

Without having to fork out that RM50,000 in cash for down payment, property ownership becomes much more feasible for people who qualify. However, with a RM500,000 loan amount, you will be incurring RM46,300 additional interest. This may not seem like a good idea for those with cash for down payment, but for those who are having difficulties saving the cash. It will also come in handy if you want to keep the cash you have for renovation or other miscellaneous costs.

However, the number of 20,000 units allocated under the scheme is hardly sufficient to meet the housing demands of the people. There is an estimated 1.6 million people living in Kuala Lumpur alone.
Needless to say, singletons will have to work harder, both in finding a property they can afford to buy and a significant other.

How GST impacts home prices

Although housing is exempted from GST, the construction costs involved are not. Once GST is implemented beginning April 1, 2015, 6% GST will be imposed on various aspects of property development such as land cost, material cost (concrete, steel, roof tiles, bricks), labour cost and so forth.

Due to this, the final selling price of residential properties, as well as non-residential properties will no doubt, increase accordingly.
Experts predict that the margin of increase will be about 3% for residential properties following the implementation of GST.

Experience from other countries such as Australia had witness trends in anticipation of future-cost drive inflation of asset prices. Already, Malaysian buyers have been rushing to snap up property in the two quarters prior to April 2015, while developers are rushing to complete their projects pre-GST.
Post-GST, property demand is expected to taper off due to the rush in buying the year before. The increases in prices could also price-out many buyers.

There is speculation that there will likely be a one-off increase in property prices across the board. The secondary home market should also see a knock-on effect in prices.
In the long term, the property market will likely adjust to GST and property activities should return to normal, given that demand and supply move accordingly upon changes in things like interest rate and loan-to-value (LTV) ratio.

The Government is doing its part in addressing issues of affordable home ownership by mobilising its housing agencies such as the 1Malaysia People’s Housing Programme (PR1MA) Corporation (80,000 units), the National Housing Department (26,000 units) and Syarikat Perumahan Negara Berhad (37,000 units) to fulfil the needs of the low and middle income class.

Extensions of the LRT and MRT

The Government will build a third light rail transit (LRT3) line linking Shah Alam, Bandar Utama and Klang to improve connectivity. This line will complement the network that is currently undergoing expansion to connect the existing Kelana Jaya line to one that runs to Putra Heights. The cost of development for LRT3 is budgeted at RM9 billion and is due to be completed in 2016.

The Government will also start work on the second line of the Klang Valley Mass Rapid Transit (KVMRT) to run from Selayang to Putrajaya at an estimated RM23 billion cost. Construction has already begun on the first line running from Sungai Buloh to Kajang.

Currently, travelling to the northern reaches of the city such as Klang and Shah Alam can be a challenge due to limited public transport options. The KTM Commuter Line running from Sentul to Port Klang is currently the only track that connects Klang and Shah Alam residents to the centre and west of Kuala Lumpur. Unfortunately, KTM is notorious for its poor service and delays, which could drag on as long as 20 to 30 minutes. Meanwhile, Putrajaya is accessible via the Express Rail Link (ERL) from KL Central.
Elsewhere, although Kajang is accessible through networks of highways, which include the North-South Expressway through Kuala Lumpur-Seremban Expressway or through the Cheras-Kajang Highway, congestion is a perennial problem for residents. Motorists can spend hours in the traffic crawl to and fro work on a daily basis.

There are currently about 500 housing estates under the Kajang Municipal Council’s (MPKJ) jurisdiction, some 200 located along the Cheras-Kajang Highway. The rapid development, along with the construction of the Sungai Buloh-Kajang MRT line, which started in 2012, has caused the situation to get from bad to worse.

The new LRT and MRT extensions will definitely be a boon for real estate located in surrounding areas. Paired with the increasing cost of living and decreasing fuel subsidies, property in locations that are easily connected via public transportation will no doubt see an increase in demand among buyers. This could potentially contribute to higher property prices.

Some industry players opine that the measures announced for Budget 2015 are too small to have any real impact on the property market.

While more can be done to reduce transactions and curb speculation in the property market, the Government is certainly taking a step in the right direction with the YHS for first-time buyers and PR1MA to help the lower and middle income group cope with soaring house prices, as well as the upcoming GST.

The upgrade in public transport system also allows urban-dwellers to cut down on fuel and travelling time on their daily commute.

Some experts believe that the escalating cost of living, removal of subsidies and GST will translate to income levels growth. However, how the property market will pan out and whether Malaysians will be able to cope successfully with the post-GST era still remains to be seen.

source

RE: Fear can paralyze you & how to come out of it

So guess what? 
The biggest obstacle in our damn hearts (I use the word "damn" because to me, sometimes i'm so frustrated with myself for not being courageous enough and this, mind you -is a personal opinion) is FEAR

So here is an article which I came across online and I wanted to share it to remind mainly myself on:

Don’t let fear paralyze you

One of the biggest obstacles in becoming an entrepreneur is fear. Think you are not afraid? Do you keep searching for the right opportunity but just can’t find the perfect deal? That’s fear. Your aversion to risk keeps you in constant analysis and research. This is commonly referred to as analysis paralysis. When this happens, you may end up doing nothing. Don’t let fear or perfection paralyze you.

Matt Clark, our featured entrepreneur guest these last few blogs, has this to say about perfection:

When trying to develop the “entrepreneur mindset” you must stop trying to be perfect. Frequently, if you haven’t achieved a goal it’s because you’re trying to do the perfect action or take the perfect path to achieving that goal.

The problem with this is that you don’t know what the perfect path is or else you would have already taken it. Being perfect leads to the perfect way to fail… doing nothing. The only way to make sure that you get anything done is by not trying to be perfect. Instead focus on taking action. Take that leap of faith, or take a lot of little hops of faith.

Don’t reflect too much on whether what you’re doing is perfect. If you experience a setback, the fastest way to get back on your feet emotionally is to take more action.

When you start taking action, and you stop reflecting on whether that action is perfect, you stop reflecting on your current situation. In order to take that new action, you actually have to focus on it, which means that your focus is not on the negatives of the current situation or how much stuff you have that you don’t like or don’t want. Your focus is on actually doing those new, positive action items.

Matt is right. Perfection is the enemy of motion. 

Perfection stops entrepreneurship. That is not to say there is no need for setting high standards and going out and achieving them. What we are saying is that too much focus on being perfect leads to inaction and focusing on the wrong things. Too much focus on perfection is usually a subconscious focus born out of fear.

You have your left brain—the logical, analytical, practical side of your world – which is usually where the need to be perfect lives. And you have your right brain—the creative, innovative, intuitive part of your world. And then you have the physical, the spiritual, and everything in between. Rising to meet your financial dreams takes all of it. It takes all of you. Just be careful not to let the desire for perfection ruin your dream of being an entrepreneur.

Source

RE: Investment Guide: RM1,000 - Now Where Do You Invest It?

So what do you do with RM 1,000? 
Here's a good guide on growing your money in investing!

Investment Guide: You Have RM1,000. Now Where Do You Invest It?

You may scoff at the idea of getting into investments with just RM1,000. You might think, “What can I do with that meagre amount?” A lot, actually. You’ll be surprised at how much you can gain in years to come if you invest that money right now.

You don’t need to invest hundreds of thousands up front to see a healthy return. With just RM1,000, you can kick-start your investment portfolio and see money rolling in.
According to your risk appetite, here’s an investment guide on where you can put your RM1,000 and see it grow.

Amanah Saham Bumiputera (ASB)

Risk: Low
Average return: 8% to 10% per annum
Example: If you invest RM1,000 over 10 years, your return will be RM1,367.36 excluding dividend and bonus

ASB is a premier unit trust investment specifically for Malaysian Bumiputera. It is managed by Amanah Saham Nasional Berhad (ASNB), a wholly-owned subsidiary of Permodalan Nasional Berhad (PNB).

It is meant as a long-term investment, with the longer you keep your money, the higher the possibility of higher return.

Some of the ASB features:

• Capital guaranteed – low risk
• No sales charges – higher return
• No redemption charges – higher return
• Maximum investment amount: 200,000 units

Real Estate Investment Trusts (REITs)

Risk: Medium
Average return: 6.82% per annum
Example: If you purchased 700 shares from Sunway REITs in 2012, and sold them in the first quarter of 2014:



REITs are meant for investors who would like to invest in property, especially retail lots, but do not have the capital to buy them outright as investments. These trusts are formed by companies that purchase and manage real estate using funds pooled from shareholders. Dividend payouts can be generous depending on which REIT you are buying.

Like most long-term investments, the longer you leave your money in it, the higher the return will most likely be.

* DPU stands for Distribution Per Unit, or also known as, dividend per share of the financial year. It is listed in sen.

Unit trust funds

Risk: Low to medium
Return: Depends on portfolio and funds
Example: If you invest RM1,000 in the AMB Lifestyle Trust Fund Today for five years on Fundsupermart.com.my, your return, based on the historical performance, may be:

 Performance figures (as of July 22, 2014)

Unit trust funds are a form of collective investment that allows investors with similar investment objectives to pool their funds to be invested in a portfolio of securities or other assets. A professional fund manager then invests the pooled funds in a portfolio which may include cash, bonds and deposits, shares, properties and/or commodities.

The return on investment of unit holders is usually in the form of income distribution and capital appreciation, derived from the pool of assets supporting the unit trust fund. Each unit earns an equal return, determined by the level of distribution and/or capital appreciation in any one period.

However, investing in unit trust will usually involve certain costs like sales charge, platform fee, annual management charge, trustee fee and other charges. By investing via Fundsupermart, investors can reduce these fees and charges as compared to investing through a fund manager.

With a unit trust fund, you can still maintain liquidity and security, but it is no longer a savings account – it is an investment. Unit trust is the most suitable investment for the common man who is interested in equities but lack the funds to diversify independently. Unit trusts offers an opportunity to invest in a diversified, professionally managed portfolio with lower starting capital.

Compare the performance of different funds to find the best one to invest on using our unit trust comparison page.

Blue chip stocks in Stock Exhange

Risk: High
Return: Possibly high return, depending on market and company
Example: If you invested RM 1,000 in Axiata in 2009 (five years ago), it would amount to about RM2,340 now.

AXIATA 5 Years                                                                          Source: Bursa Malaysia

 

Investing in blue chip stocks are recommended not just because of the capital appreciation, but also the attractive dividends, depending on the company. In the example above, Axiata is a well-known and reputable blue chip company.

Blue chip companies refer to reputable and financially sound companies, selling high-quality, and widely accepted products and services. These companies are known to weather downturns and operate profitably in the face of adverse economic conditions, which helps to contribute to their long record of stable and reliable growth.

However, if you’re risk averse and not well informed, stocks should not be used as a short-term investment in order to make a big profit. This action is not investing, but pure gambling. There may be times in which stocks have put a record on short-term growth, but these occurrences are very rare.
Making short-term transactions with stocks can lead to high cost of investment due to the various brokerage and transaction fees. Depending on your investment amount, these fees can add up to a significant amount.

As Warren Buffett once said, “If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes.”

No matter which investment vehicle you pick, it should have a long-term flavour. That way, you don’t get eaten alive by trading fees on a relatively small amount of money invested, and there can potentially be higher return on your money.

For most people who are struggling to save up on some money to invest, remember, it can always be done over time. You can always top up your investment in various investment vehicles as and when you have saved up some investment fund. If you keep at it over time  you will gradually build up a pretty secure and diverse investment portfolio. It’s always good to start early!

SOURCE