LEVERAGE ON THE OVERSUPPLY MARKET!! A COMPLETED UNSOLD EXAMPLE

Link to join my team in property investment club: bit.ly/3DxoxWS
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Throughout the media, it's always about bad news and oversupply within our property market. This round, I've made an episode to discuss how to leverage on the current oversupply situation within the market. We have lots of completed unsold units within the market and that gives us absolute certainty for investment. We get to calculate practically everything from acquisition to tax, to lawyer fees and to renovation cost, before pulling the trigger to buy.
Also, I've showcase a brand new budget friendly series by The Makeover Guys as a reference for everyone.
Anytime is a great time to buy, it just depends on the entry price along with the rental returns.

[@BobaPom]

Now my biggest question is where do I look for unsold unit by developer themselves?

[@ylihao]

Great info thanks Sean! One thing about units facing forest/greenery is perhaps less sunlight in the afternoon and *bugs* lol, but definitely much less dusty and noisy than facing the highways 🤣One thing I want to mention is your B-rolls! They really enhance your videos and make them so much more enjoyable to watch! Love your B-rolls!

[@screwedz2]

Sean, monthly mortgage repayment for a RM432,000 loan (Assuming 90% of RM480K purchase price) is closer to RM2,000/month at current interest rates (~4.35%) unless you were able to fix your interest rates before the rate hikes in the past year. I think you may have forgotten to mention about the monthly property maintenance fee that the owner has to bear which is excluded from the RM2,500/month rent that the tenant pays. That’s another RM300-400 depending on your unit size and condo, so the buffer is definitely not RM1,000/month for most projects, otherwise, there would be a lot more investors in this market..

[@chinkayeok6117]

Apartments are good to let out but not for disposal. Landed property is still a safer bet.

[@iherng]

Interest rate varies to different profiles. In my latest purchase I got lower than that rate. But anyway, these are not cast in stone. The rates varies all the time. But here demonstrates the methodology of accessing data and comparing rent against the installment. For maintenance, again some investors calculate everything. Personally I do not include that because banks don’t include them in my DSR calculations. Of course, this is provided my active income can sustain the outstanding payments then everything will be alright. Thanks for highlighting:)

[@screwedz2]

@iherng - I agree that the interest rate would differ based on the individual. Lower interest rate than that is definitely possible, it’s just within the range of reasonable expectations based on current market conditions. A mortgage of RM1,700/month would imply that your interest rate is 3.2% which is practically impossible in the current market, unless you’re some tycoon or something. Nevertheless, I really appreciate your view on things and I totally agree with the fact that developer units may make sense for some people. It’s just that this type of info will reach or is usually intended for the mass market (property tycoons probably already have their own groups to bounce ideas off) and some of the numbers that were misleading threw me off. I would definitely recommend anyone who is considering investing, do some additional research and work out the numbers for yourself. Mind you, I’ve excluded a lot of the other smaller expenses, such as insurance and cukai pintu, etc. that will eat into that margin between rental and mortgage. Not everyone constantly look to buy multiple properties, and what goes in and out of your pocket really matters at the end of the day. Thanks for sharing your views though!

[@khoyyenpoi3391]

need include monthly insurance if loan.

[@nicklasprince]

Even if some money is out of pocket, imagine a bank that tells you, every month you put 300RM in your account, you get 2200rm in interest, that would be insane, still, that is what you get when a unit is rented out once you sell it, even if the rent does not cover all your costs.

[@leeaaron7856]

Hi Sean, thanks for the good overview of how one can start on an investment journey, by working out the costs, rental rates and finally the margin on the return. I would like to add on to people starting their investment journey is to always work out the rental yields as this is an excellent indicator to compare between properties. The higher the yields the better the returns. Always shoot as high a yield as possible for any property. This days a lot of investors seem to forget about this and starting chasing their property investment dream because of FOMO or hype around a particular project.

[@ericlai3221]

"certainty" is great!

[@deonnicholaslee]

I used to stay at Vista Komanwel A Bukit Jalil and it was surrounded by forest, there are monkeys everywhere and we always go into the forest for exercise and hiking. Those were the good old times at Bukit Jalil

[@iherng]

Bukit jalil is just HOT for new projects. There are around 8 new projects within the last 6 months😂

[@revolusirevolusi-jw7tn]

now just turn into another soulless concrete jungle

[@arch-covery-xy3bg]

Hi Sean, thanks for sharing. Is it possible to do videos for commercial unit next time ? Looking forward to it😊

[@iherng]

Do you mean shop office? Or retail? Or grade A purpose built office building?

[@michaelbyz23]

Thanks again for the awesome video

[@iherng]

Thanks for watching Michael!!

[@ahmadfrhn97]

the rental rate that they put up, usually does it include sinking and security fees? or is that something the tenant have to settle on their own?

[@kenlim2179]

Hi Sean, I am very interested in Caledonia KLK. Is it worth for own stay?

[@edwinlee3632]

Great episode, bro

[@iherng]

Glad you like it Edwin!!

[@SmartBiznes2023]

thanks for sharing

[@iherng]

Thanks for watching!!

[@Baf99]

Where to look for these unsold unit yav

[@vwchan841]

OK, GREAT video Sean!!!! I would love for you to expand along this subject of unsold units in Malaysia. For example, my understanding is that unlike say here in the US, there, you can have multiple agents selling the same unit. That of course makes it seem like a ton of units are available which may shy away potential buyers. I would love for you to help us potential subsale buyers, especially the overseas ones. You know, what to look for. How do we determine (if we can) if the builder is a good one with a solid reputation for build quality (or not). Thanks!

[@hlyh1230]

Are unsold completed projects not entitled for DLP, by default?

[@user-cb7fg8xg2b]

Hi Sean, regarding the DLP. Recently I got a completed units directly from developer and was informed that it’s only 6 months instead of 24 months. May seek for your advice. Regards.

[@iherng]

Well it differs from developer to developer. I have stories with full DLP. But since the unit has been completed for some time, we can clearly identify issues from our neighbours as well:)

[@user-cb7fg8xg2b]

Sean, I see. Thanks for your advice. The project just VP like 6-8months ago. Was surprised that owners who purchased under con enjoy the usual 24 months DLP 🥲.

[@lipkwongyee8760]

Hi Sean, any good lubang of such unit for my son.

[@e-kartuntv3335]

Hi Sean, is Desa Park City condo worth to invest?

[@iherng]

Of course. But it depends on your expectations of return:)

[@jordancwn88]

Unless u can buy cash... It's gonna be money pit... It's overhang for a reason... No big frog jumping around

[@chinkayeok6117]

Always assume that you can let it out and rental free flow throughout...it's not for those who cant take risks

[@iherng]

In this case, you already know the rent for your neighbours. So you can always establish your own safety factor. If they rent out RM2000, we can always use RM 1800 as our safety rate for calculation?

[@coeurblanc4999]

Is the makeover guys available in JB?

[@iherng]

Yes. You can contact the team directly via the link at the description:)

[@coeurblanc4999]

What is the benefit of the promo?😊

[@thecowegg]

At the current economy, if you can afford to buy and keep, that’s an investment. If you can rent it out, that’s a bonus. That’s an iron clad investment. Other than that, things are very unpredictable these days. Covid thought everyone a good lesson, no mountain is high enough for the floods. Just saying 👍

[@candosqdawn6196]

Foreignor can buy at build unsold unit at a 460k ?? Since it is unsold , so is not a sub sale unit right

[@iherng]

Unfortunately cannot:/ Thanks for watching!

[@liudaniel6656]

Hi seah, currently is the JB market still over supply?

[@iherng]

In my opinion, yes. But it’s recovering rapidly after the market corrections.

[@liudaniel6656]

Ok noted. Thanks for your reply. I am impressed 👍 with your knowledge ☺️

[@InvestingWithAdamK]

Are you a realtor? Do you help people to find rentals or places to purchase?

[@iherng]

Unfortunately I’m not.

[@InvestingWithAdamK]

@@iherng too bad. We’re considering spending a year or longer there. If you know someone you like feel free to share their information

[@whutever]

Hi Sean, I have a question. Is it true that if a bumi buys a leasehold project, the unit would be automatically turns into bumi lot? Considering bumi lots have restrictions especially when selling, it could be a disadvantage for a bumi investor.

[@iherng]

Not leasehold, but bumi released unit. That's what I heard. But when I check the title, there are no direct indication. Also when I ask around the market, no one can give me a 100% answer to this :( It's 100% true as a disadvantage for Bumi investors actually, that's why you guys have to really do lots of research prior to purchasing.

[@whutever]

@@iherng Thanks for the answer Sean. Yes, unfortunately there's no indication of whether the unit that you bought is a bumi lot or not as I've heard stories where the owner only realises that their unit is actually categorised as bumi lot when they tried to sell to a non bumi. Even for own stay, having a bumi lot is quite a disadvantage as your unit would be a lot harder to sell if you want to in the future, hence lower appreciation.

[@ehsan.j.88]

when you talk about certainty of completed unsold unit, whats certain is that the reason why its unsold because there is supply/demand mismatched in the first place..if a place has a hot rental demand you would not find unsold properties 😅

[@khoyyenpoi3391]

and if everyone to buy there just to rent, imagine whole block is for rent, the competition will be huge XD

[@JH-ju3di]

Hi Sean, you mention when the market is bad there will be more of such deals. But how do you guage on the property market conditions? Lai bagi sikit tips 🤭

[@iherng]

Only when market bad there are leftover units mah hahaha. If good market, everything sold out wan:)

[@ndc2963]

You’re glossing over the certainty of getting no capital appreciation whatsoever when there’s unsold developer units available. Then this further feeds into cashflow concerns for the developer who may go bust before strata title is perfected.

[@iherng]

Great point. That would be the reputation of the developer. For this particular unit, the developer is the main township builder for the area so winding up would be almost impossible. But for non public listed or boutique developers, your concern is 100% valid.

[@tanbf8719]

I have one next to this project, the Ioi Conezion 783sf 2R 2B 2C for sale. Anyone interested please let me know.

[@danielevee2544]

I really miss the good old time that condo size at 2000, 3000 and even 5000sq ft and above, nowadays condo unit just too small at 500 sq ft and the largest unit is only 1300 sq ft. It does not captivated me at all.

[@hazimyusoff67]

Haha, i miss those days too but couldnt afford any of them. Hahaha

[@Aeybiseediy]

Where can find 5000sqft condo?

[@starbuggle]

⁠@@Aeybiseediyaffluent areas like Dsara Heights, Mt Kiara, U Thant

[@user-gt6yc3tn3q]

is this commercial sponsored episode? and the so call foliage view is temporary or gazetted green?

[@iherng]

Nope. Just sharing on how I'm leveraging on my team's resources to do better planning in costing. This actual unit is not for sale, just an example for discussion to better bring out the point.

[@user-gt6yc3tn3q]

@@iherng anyway keep sharing... just some fact check needed, a quick check of zoning for adjacent lot is easy !

[@darrenong6585]

Boss why only promote the makeover guy only!!! Other ID not good meh!!!!! Need your feedback!!!!!

[@alylau7324]

He works at makeover guys. If that answers your question.

[@iherng]

I work there mah. Also most of my units are done by them. So in terms of reliability, they’re pretty much my choice!

[@aravearave]

he is working for makeover guys , and hes upfront about it

[@chanmunfei7986]

I mean you're free to find your own ID to compare with The Makeover Guys, maybe another ID may more suit your needs. But one thing is good about The Makeover Guys is they're very upfront with the prices while some IDs will hide the prices until you ask for quotes and they ask a million questions about it.