enforcement director Datuk Mohd Roslan Mahayudin (centre) giving a press
conference on the raids which yielded luxury vehicles and cash. Despite the crackdown by the authorities, investors continue to patronise M Mall, which is operated by MBI.
|Why millennials are flocking to real estate|
“We believe the strong growth in our young buyers is both a natural
evolution and as a result of a conscious strategic effort we have made
to appeal to this important customer group,”–
Datuk Chang Khim Wah
Property developers are seeing a pick up in sales, especially from younger buyers, as the numerous interest rate cuts and government incentives have spurred buying interest.
Eco World Development Group Bhd president and chief executive officer Datuk Chang Khim Wah said the increase in younger buyers was due to a conscious strategic effort made by the group to appeal to this target market.
“During our initial years of operations (circa 2015) the percentage of young buyers (below 40 years old) was around 43% and today it is more than 70%.
“We believe the strong growth in our young buyers is both a natural evolution and as a result of a conscious strategic effort we have made to appeal to this important customer group, both through the products we are offering as well as the way in which we engage them via social media and digital channels, ” he told StarBiz.
Of the 70%, Chang said around 50% are in their 30s and the remaining 20% are in their 20s. “We are particularly happy that a good number of these buyers include children of our own customers and residents in the vicinity of our development. This validates our efforts over the last few years to make a strong pivot to serve the needs of this market segment and the wider M40 group.
“Our upcoming launch of the new Duduk series of vertical townships offering semi-furnished apartments priced below RM400,000 at Eco Ardence and Eco Sanctuary, as well landed homes starting from RM500,000 at Eco Botanic 2, will enable us to further capture the hearts and minds of this very important market segment.”
Chang said the prolonged movement control order (MCO) period has really made many young people realise that the quality of home and living environment matters greatly.
Mah Sing Group Bhd chief executive officer Datuk Ho Hon Sang (pic below) said as the bulk of its projects comprised units within the affordable range segment, the majority of its buyers comprised those below 35 years of age.
“For Mah Sing, 84% of our target sales for 2020 are for residential properties priced below RM700,000 with key focus in the affordable segment. We typically see about 65% of buyers who are 35 years and below, for most of the affordable projects were launched in recent years. Hence, the majority of our buyers are first time homeowners.”
Despite the challenging market environment in view of the Covid-19 pandemic, Ho said demand continues to be resilient as property remained one of the safest forms of asset class for long-term capital protection and appreciation.
“Malaysia’s population is still very young with 66% below 40 years old and as such, household formation continues to be strong. Affordably-priced properties of good quality and at strategic locations remain highly sought after.
“This is especially for first-time home buyers, which augers well for Mah Sing’s product composition.”
Sunway Property said it is seeing increasing interest from younger buyers from 25 years to 35 years in its properties that are transit-oriented and have good facilities nearby.
“For example, our developments such as the transit-oriented Sunway Avila in Wangsa Maju, the integrated and transit-oriented Sunway Velocity TWO and the youth-focused development of Sunway Grid in Sunway Iskandar has seen enthusiastic response from younger purchasers, ” it said.
Property data, analytics and solutions provider MyProperty Data chief executive officer Thor Joe Hock said the median age for residential property transactions has gradually dropped over the years.
“When we look at the over 2.5 million residential property transactions, including serviced apartments, it appears that the median age of buyers from 2000 to 2019 has remained largely unchanged at between 34 to 35 years of age.
“However, when you break it down into landed and non-landed transactions, we start to get a clearer picture. The median age for non-landed properties has fallen from 40 years in 2000 to 28 years in 2019; while the median age for landed property purchasers marginally decreased from 40 years to 37 years over the same period.”
MyProperty Data manages a property data portal called PropertyAdvisor.
Meanwhile, Lagenda Properties Bhd managing director Datuk Jimmy Doh said more than half of its buyers are below 39 years of age.
“We believe as young people start new phases in their lives, for example getting a job or starting their own families, they prefer to stay independently and have their own space, granted that the properties are within their price range.
“Over the past few years, we have been seeing an increase in buyers. Our properties are priced below RM200,000, ” he said.
MIDF Research in a recent report said the aggressive overnight policy rate (OPR) cuts have improved home buyers’ purchasing power.
“Bank Negara cut its overnight policy rate for the fourth time this year by 25 basis points (bps) to a record low of 1.75% in July due to the severe impact of the Covid-19 pandemic on the global economy. The aggressive OPR cuts this year are positive to the sector as it improved home buyer’s purchasing power by reducing loan installments.
“We estimate monthly installments to reduce by 14%, after 125 bps cut for RM500,000 loan with a loan repayment period of 30 years, which is quite significant in our view. Hence, we think the record-low interest rate will partly help to alleviate home buyers’ issue of securing home financing, as the record low yield has boosted the affordability of home buyers.”
MIDF Research also said it expected loan demand to recover in the second half of 2020.
Citing Bank Negara’s statistics, it said total applied loan for the purchase of property improved sequentially by 52.9% month-on-month to RM13.1bil in May, after plunging by 64.8% month-on-month in April.
“Note that total applied loan recorded steep decline in April due to the disruption to business activity following the commencement of the MCO.
“Nevertheless, total applied loan in May was lower by 61.8% year-on-year while cumulative total applied loan in the first five months of 2020 was lower by 33.6% year-on-year, indicating buying interest was subdued.”
Looking ahead, the research house expected buying interest to recover in the second half of this year, spurred by incentives introduced by the government.
Under the Short-Term Economic Recovery Plan (Penjana), which was announced in June, the government reintroduced the Home Ownership Campaign (HOC). Under the HOC, stamp duty exemption will be provided on the transfer of property and loan agreement for the purchase of home priced between RM300,000 and RM2.5mil.
( From left) Chow looking at the Penang NCER
human capital graphic info. With him are John, state executive
councillor Datuk Abdul Halim .
Millennials now make up over a third
of the workplace and overwhelmingly value flexibility in where, when and
how to work. And top talent has been increasingly clustering in dense
urban areas and has been unwilling to commute to suburban office parks
We found that data availability and transparency in the real estate sector is less than what we were used to when we were
M Mall in Penang where MBI investors can exchange their virtual coins is now almost deserted.
IT may seem like it was not so long ago that money-game was practically on everybody’s lips especially here in Penang,
My close friend even invested in MBI Group International which was one of the most popular investment schemes then.
At its peak, one would be considered the odd one out for not investing in the scheme.
How times have changed. Now, my friend is telling me that he has not heard from his upline for months.
It was a far cry from the time when the upline would tell him how good the scheme was, and even spell out a time frame to cash in on the investments.
Most investors have now resigned to the fact that their investments are as good as gone. They feel ashamed to lodge police reports and many just suffer in silence for fear of people teasing them.
However, their counterparts from China were less forgiving.
In October, hundreds of them staged a peaceful protest near the Chinese Embassy in Kuala Lumpur. Wailing and sobbing, they urged the Chinese government to help them recover the hundreds of million ringgit they had invested in the Penang-based company.
In Penang, several groups of Chinese investors also vented their frustration at a hotel and the jetty of an island resort here, where both properties are said to be associated with the company.
The last we heard, three of them even went to the extent of dropping fake bombs at a house in Bukit Gambier out of desperation.
The house belongs to the son of MBI Group International founder Tedy Teow. Luckily, no untoward incidents took place.
Another friend of mine told me that he started believing in karma after putting faith in the money- game.
He is now convinced that what goes around, comes around. This is his story.
He put in a sum of money in BTC I-system, a scheme which claimed to invest in bitcoin digital currency.
Without even knowing how the investment works, he managed to get back his capital within two months, plus a few thousand of ringgits extra in the next few months. Then the scheme collapsed.
He then took the plunge again in another scheme. He was confident of easy money again, especially after being told he was among the first few to join the investment. He was not so lucky this time.
The profit that he got in the first investment ended up paying for the second scheme that went bust.
I have seen many people whose relationship with family members had become strained all because of these dubious schemes.
Direct Selling Association of Malaysia (DSAM) president Datuk Tan Chong Guan reminded the public that there is no free lunch in this world.
“Where there is no sales but a return is promised on investments, this is a sign that it is a money-game, or a pyramid scheme, ” he was quoted then.
If you still could not figure out or get a clear explanation on how the investment will make money, then you better opt out.
If it involves any chain-recruitment that offers commissions for bringing in new affiliates, or sophisticated or complicated investment schemes that sound too alien, then you better avoid it.
Always remember that one has to work hard to earn one’s keep.
But believe me, money-game would always re-emerge in other forms, just like the online scams as long as there is human greed.
Many procrastinate on starting a retirement fund thinking there is still a long way to go to retirement age. However, they fail to realise the effects of inflation on their retirement funds. To ensure you have enough time to build a stress-free retirement, here are some reasons you should start saving while you are young.
• Financial independence – As the saying goes, “Sikit-sikit lama-lama jadi bukit.” When it comes to investing your savings, the earlier you start, the greater the accumulated returns on your original investment thanks to compound yield. By investing consistently and regularly, you will be able to secure yourself a comfortable retirement without having to depend on others. Work towards accumulating enough to cover the cost of your basic necessities, lifestyle expenses and occasional splurge on luxuries.
• Saving is a good habit to develop – If you start saving for your future from a younger age, you will find that it becomes second nature. It will be easier to put aside some money for retirement. It helps to start with small amounts, especially for young adults who are just entering the workforce, so it is not as overwhelming. How you manage your paycheck will determine how you save for the rest of your earning years. A person who is used to saving on a monthly basis will find it easier to set aside 10% of her salary for retirement as opposed to an individual who is not used to spending her money prudently.
• Gain control over your future – When you set aside money for your retirement, remember that you are shaping your future.
This is a task no one else will perform for you or push you to do. By saving consistently, you are ensuring that you are well prepared for any outcome when you leave the workforce. With sufficient savings, you will most likely be able to live your dream lifestyle even during your retirement years – promising you the peace of mind of a secure financial future.
Steps to successful retirement planning
Building a substantial sum for your retirement nest egg can be easy and painless if you start investing early and regularly. Public Mutual’s Direct Debit Authorisation facility allows you to invest regularly while employing the Ringgit Cost Averaging strategy.
Not only that, you can enjoy tax relief of up to RM3,000 per annum if you contribute to the Private Retirement Scheme (PRS) fund. PRS contributions are creditor-protected. Public Mutual’s PRS contributors can also enjoy a free insurance or Takaful coverage of up to RM100,000, subject to terms and conditions.
To cater to diversified investors’ needs and investment objectives, Public Mutual offers six PRS core funds and three non-core funds, which make a great pool of funds for investors to choose from. Young investors who have long-term investment horizons can consider investing in PRS non-core funds, which can yield better potential returns in the long term.
These articles are prepared solely for educational and awareness purposes and should not be construed as an offer or a solicitation of an offer to purchase or subscribe to products offered by Public Mutual. No representation or warranty is made by Public Mutual, nor is there acceptance of any responsibility or liability as to the accuracy, completeness or correctness of the information contained herein.
GEORGE TOWN: Waves of excitement swept through Penang when the Transport Minister announced that the Bayan Lepas light rail transit (LRT) has received conditional approval.
It is seen as a move to reduce traffic congestion in the city and create a next wave of growth for the state.
The approved 29.9km Bayan Lepas LRT will bring convenience not only to the local folk but also tourists and investors, said Federation of Malaysian Manufacturers Penang chairman Datuk Dr Ooi Eng Hock.
Ooi, who is positive that the project will spur growth on the island, believes the LRT will bring in another wave of development into the state.
“The LRT will divert traffic congestion. It will attract new investments, make life easier for our workforce.
“I believe it will boost the state’s economy with another wave of growth,” he said yesterday.
Following the Transport Ministry’s conditional approval of the project, Ooi added that it is the first step for a change in landscape and behaviour of transport mode in Penang.
Yesterday, the Transport Ministry gave conditional approval to the Bayan Lepas LRT project.
Transport Minister Anthony Loke in a statement said that after a detailed study of the application by Penang Economic Planning Unit (BPEN) to develop the Bayan Lepas LRT project, approval with 30 conditions for the state to comply was given on Tuesday.
Loke said the conditions included a detailed environmental impact assessment (DEIA) approval including traffic, social and heritage assessments.
The state must now exhibit documents on the project for three months, and the final go ahead will only be decided after the public responses are evaluated, said Loke.
“I welcome public participation from the people, NGOs and all stakeholders in this public review.
“The relevant documents are to be exhibited in public places including government offices.
“The state government must also upload a copy of these documents on a website for online viewing.
Penang Chief Minister Chow Kon Yeow thanked the Federal Government and said the state is committed to fulfilling all requirements.
“We will wait for the official letter from Transport Ministry to proceed and initiate public viewing of the documents,” he said.
The RM8.4bil Bayan Lepas LRT together with a monorail, cable cars and water taxis, is part of the state government’s RM46bil Penang Transport Master Plan (PTMP).
This LRT will begin at Komtar in the northeast corner of the island and head south through Jelutong, Gelugor, Bayan Lepas and Penang International Airport, ending at the Penang South Reclamation (PSR) development.
It is expected to provide a fast route to the airport and will traverse densely populated residential, commercial and industrial areas.
THE World Economic Forum estimates that the global cost of corruption annually is at least US$2.6 trillion (RM10.9 trillion) or 5% of global gross domestic product (GDP).
According to the World Bank, businesses and individuals pay over US$1 trillion (RM4.2 trillion) in bribes each year.
Corruption adds up to 10% of the total cost of doing business globally and up to 25% of the cost of procurement contracts in developing countries.
I gathered these shocking facts at a conference. There are other alarming statistics that shed light on the damage brought about by corruption and its dreadful impact on the economy.
Corruption leads to further impoverishment of the poor and other issues in many countries. The average income in countries with a high level of corruption is about one-third of those countries with a low level of corruption. In addition, corrupt countries have a literacy rate that is 25% lower.
The Corruption Perception Index 2018 released by Transparency International shows that on the scale of 0 to 100, where 0 is highly corrupt and 100 is very clean, over two-thirds of 180 countries score below 50, with the average score of 43.
In the index, Denmark ranked first in the world followed by New Zealand second. Finland and Singapore were tied for third with a score of 85. Malaysia was ranked 61st in the world, scoring only 47.
We were ranked the third highest in the Asean region, after Singapore and Brunei. Our country is doing better now with the ongoing investigation of the 1Malaysia Development Bhd scandal and other prominent cases.
In TI’s report, Malaysia is one of the countries on the watch with promising political developments against corruption. However, more solid action is needed in combatting all elusive forms of corruption.
According to Transparency International Malaysia, corruption had cost our country about 4% of its GDP value each year since 2013. Added together, this amounts to a high figure of some RM212.3bil since 2013. For 2017 alone, that figure was a whopping RM46.9bil!
As a comparison, our development expenditure in 2017 was RM48bil. If the value of corruption above was accurate, our development fund was almost “wiped out” because of corruption.
Transparency International Malaysia president Datuk Akhbar Satar said: “This is our estimate. It is likely to be higher in reality (on the value of corruption).”
No country can eliminate corruption completely. However, we can learn from good practices shown in some developed countries, such as the Scandinavian countries which all scored high on the Corruption Perception Index.
Corruption leads to poverty as money collected is not used for the welfare of the nation. As a result, the people end up suffering and paying for the leakage in the system.
If a country is corrupt-free, it will reduce the need for non-governmental organisations (NGOs). NGOs advocate for the rights of marginalised groups. The government can take care of those group when it has a surplus in the budget.
A clean government and system will have a positive impact on many aspects including affordable housing, one of the prominent needs of the people.
Whenever there is corruption, there is a compromise in the delivery of goods and services. The same situation applies to affordable housing.
Someone mentioned to me in the past that “the government isn’t interested in affordable housing as there is literally ‘no money’ to be made in it”!
Things have made a dramatic change for the better since May last year. Our new government is working on a platform of clean government and improving transparency. It plans to build one million affordable homes within two terms of its administration. To make this a reality, the government needs to put in real money to make it happen.
Corruption causes a death spiral that leads to various problems. Without it, a virtuous cycle grows that ensures every part runs smoothly and the marginalised in society are looked after.
With a promise of a cleaner government, we hope we will soon see a virtuous cycle that makes the one million affordable homes an achievable target.
By Datuk Alan Tong, who has over 50 years of experience in property development. He is group chairman of Bukit Kiara Properties. For feedback, please email email@example.com. The views expressed here are solely that of his own.
PETALING JAYA, Feb 26 — Most would agree that you truly reach adulthood the moment you own your own property.
Just like any other major milestone in life, getting there comes with its own set of challenges that many young Malaysians have to overcome before they can successfully purchase a home.
Here are five hurdles Malaysian millennials might encounter on the path towards home ownership:
1. Worrying about making the wrong choice, when is the ‘right’ time to buy?
Purchasing a home can be a major decision that many Malaysian youths feel overwhelmed by. — Pexels pic
Making the decision to buy a piece of property is a huge step that young locals aren’t quite brave enough to take yet.
Social news website SAYS’ 2019 Malaysian Home Survey among 8,568 Malaysians reports that one in five respondents had “(worries) about making the wrong decision”, especially since home ownership requires a hefty financial investment.
2. Unsure about loan application and loan rejections.
Do you have enough saved up for a home in the future? — Pexels pic
A difficult loan approval process is a huge factor that dampens many Malaysians’ prospects of owning a home.
PropertyGuru’s Consumer Sentiment Survey in 2017 states that 33 per cent of Malaysians reported a tough approval process for bank loan applications which presents a major roadblock on the path to home ownership.
3. Starter salaries, not enough money saved for a downpayment.
The average Malaysian needs to plan carefully if they want to own a house with their current salary. — Reuters pic
The thought of dealing with a mortgage on the salary of a fresh graduate is making many millenials think twice about owning a house.
The Employee’s Provident Fund statement in 2016 had said that 89 per cent of the working population in Malaysia earn less than RM5,000 monthly, making home ownership especially challenging.
Most millenials wouldn’t believe that they could own a house with that salary.
4. Renting or owning?
It’s not easy maintaining a modern lifestyle when you’ve got a mortgage weighing on your shoulders. — Unsplash pic
The hefty financial commitment to owning a home means young Malaysians will have to make some lifestyle changes if they want to stay afloat while having a house to their name.
This might mean foregoing luxuries such as weekend brunches and holidays overseas which have become staples for the modern generation.
Hence, a monthly instalment replacing these pleasures is the reason 33% of Malaysians in SAYS’ survey are saying ‘no’ to home ownership.
5. Lack of awareness on housing deals and promotions.
Housing deals and offers don’t seem to be showing up on the radars of young Malaysians. — Unsplash pic
While initiatives are in place to help young potential homeowners, many do not even know about the resources available to them that can ease the burden of property ownership.
A shocking 65 per cent of Malaysians in SAYS’ survey said that they had no clue about current housing offers and promotions.
This means that many young adults are currently unequipped with knowledge about navigating the property market.
In light of this, property developers EcoWorld have launched HOPE (Home Ownership Programme with EcoWorld), a comprehensive solution that promises to aid young Malaysians in their journey towards owning their dream home.
HOPE aims to make the dream of home ownership a full-fledged reality for millennials with the STAY2OWN (S2O) and HELP2OWN (H2O) programmes.
S2O will allow those wanting to stay in an EcoWorld project to rent their ideal home first with the confidence that they can become homeowners in the future.
A low monthly payment similar to the market rental rate also makes it particularly attractive for first-time homebuyers.
The option to rent first before buying also gives customers ample time to get their finances in order before committing to a new mortgage.
To top it all off, the rental savings will be used to offset part of the purchase price of the home, making it even more affordable for young Malaysians.
The H2O had successfully helped approximately 1,800 young homeowners and upgraders own their choice EcoWorld home last year and you can be one of them too! For more information on owning your dream home, visit EcoWorld’s website https://ecoworld.my/hope/) or Facebook (https://www.facebook.com/EcoWorldGroup/).
By Tan Mei Zi The MalayMail
* This article is brought to you by EcoWorld. https://ecoworld.my/hope/
Given a choice, would you prefer to get a loan to buy an item that depreciates over a short period which is deemed as “bad debt” or commit on a “good debt”, which is to purchase a house or asset that will appreciate in the long term?
A car used to be a symbol of freedom and ease of mobility. I could understand the dilemma of having to choose between a house and a car a decade ago.
Even then, we should still have chosen a car within our means to manage our financial position.
Today, with public transportation and the availability of ride-sharing services such as Grab Car, we can now really have the option of buying a house first. This gives us both shelter and value appreciation.
This choice has just been made easier with Budget 2019 and the recent announcement by the Finance Ministry.
The government has rolled out several measures to assist homebuyers, including stamp duty exemptions.
Homebuyers will get a stamp duty waiver for memorandum of transfer (MoT) for the purchase of houses priced up to RM1mil, during the six-month Home Ownership Campaign (HOC) from January to June 2019. In addition, the stamp duty on loan documentation is fully waived up to RM2.5mil.
Besides that, the Real Estate and Housing Developers Association (Rehda) has also agreed to cut the prices of its completed and incoming units by at least 10%.
When I talk to potential homebuyers, they always ask about the right time to own property.
There is no perfect time to buy a house on foresight. If the price is within your means, and you plan to buy it for own stay or as a long-term investment, then anytime is a good time.
However, with the property market at the bottom half of the cycle now, this could be a good time to commit to a house with the attractive tax incentives rolled out by the government.
Homebuyers can grab the “duty-free” opportunity now to explore the property market. Those living in the Klang Valley will be able to find their dream home during the Homeownership Campaign Expo at the KLCC Convention Centre from March 1-3.
The campaign is jointly organised by Rehda and the Housing and Local Government Ministry. Besides having all developers under one roof, the ministry will also be featuring homes under RM300,000 by PR1MA, SPNB, PNB and others.
The Homeownership Campaign was first held in 1998 to lessen the burden of homebuyers and to encourage homeownership. It is re-introduced after two decades now with the same objective.
For homebuyers who don’t like the risk of buying a house under construction, there are plenty of completed units for sale in the campaign.
Buying a house can be emotional and uncertain for many homebuyers. However, in the long run, we can rest assured that we are buying an asset that will appreciate.
For homebuyers, always buy within your means as you can upgrade your house in the later stage of your life.
In this auspicious Chinese New Year, I hope you decide to prioritise a new house over a new car. Gong Xi Fa Cai!
By Alan Tong . . . Food for Thought
Datuk Alan Tong has over 50 years of experience in property development. He was the World President of FIABCI International for 2005/2006 and awarded the Property Man of the Year 2010 at FIABCI Malaysia Property Award. He is also the group chairman of Bukit Kiara Properties. For feedback, please email firstname.lastname@example.org
While young adults all over the world are renting homes, successful
Malaysians and Singaporeans prefer to own homes instead of cars, as soon
as they get their first pay cheque.
Instead of blowing their cash on pricey gadgets, young Malaysians are saving up for their first home.