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Where Do We Go From Here?

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Milan Doshi, Certified Financial Planner and speaker at the Property Investment Convention 2014 shares his views.

What is your view on the current property market?
Current trends in purchasing Malaysia property are characterized by investment either in the capital city of Kuala Lumpur or within the new coastal resorts. City investment is growing in line with increased direct foreign investment from Asian countries. A surge in economic activity has brought with it a high demand for quality commercial and residential real estate lettings to serve an ever growing expatriate community employed in and around the city. Off plan properties are being sold to international property developers with impressive guaranteed rental yields of between 6 and 10%.

Meanwhile, growth in the tourism sector has prompted the birth of new resorts, particularly in coastal areas just south of Kuala Lumpur around Port Dickson. Boosted by a strong tourist industry, property purchasers are experiencing impressive returns on their buy-to-let and off-plan investments. These holiday resorts also offer great potential for second home buyers seeking an exotic overseas home in the sun.

As a current trend, the result of a successful growth in economy and a competitive foreign exchange status, Malaysia attracts an exciting new influx of foreign investment in industry and real estate. Residential and holiday home purchasers are confidently buying into the very beginnings of a property boom in Malaysia, safe in the knowledge that prices are relatively low and growth figures remain high.

Are there still opportunities available in the market?
As is often the case in emerging markets, city center property investment can yield some high returns and Kuala Lumpur is no exception. With an ever increasing expatriate worker presence, a requirement has emerged for commercial premises, top-end accommodation, off-plan properties and buy-to-let options which are particularly attractive to investors. Alternatively, due to a sharp increase in tourist figures in Malaysia, property purchasers are finding some excellent opportunities in coastal areas such as Port Dickson.

As a result of a successful growth in economy and a competitive foreign exchange status, Malaysia attracts an exciting new influx of foreign investment in industry and real estate. Residential and holiday home purchasers are confidently buying into the very beginnings of a property boom in Malaysia, safe in the knowledge that prices are relatively low and growth figures remain high.

What are some of the strategies to become a smart investor?
Firstly, you purchase investment properties primarily for their cash flow; not for their potential capital growth. That at some point in the future they could sell the investment property and after accounting for the interest on the loan along with all the other holding costs they could walk away with a tidy profit.

Unfortunately though, most people don’t know that the demographics of the past are not the demographic of the future. The ‘baby boomer’ era created enormous wealth opportunities, however that era is fast drawing to a close. And both the stock market and property investors need to be aware and ready.

Secondly, investing in property for cash flow is much more difficult and requires the investor to become financially educated.

While just about everyone is telling you to “go for capital growth”, it comes at a financial cost and opposes my view of what makes a property an asset. Simply put, assets put money into your pocket. Liabilities on the other hand take money out of your pocket. Cash flowing in or cash flowing out, you don’t need to be Einstein to work out which is the better outcome. You do however need to be financially educated.

What are some of the proud records of WMA?
Wealth Mastery Academy has seen series of success over the years. From a humble beginning of 500 participants, we have garnered a total of 1,600 participants for last year’s PIC 2013. An increase numbers of participants over the years and we’re proud to acknowledge the support from our increasing pool of participants. We will put on greater effort in delivering equally successful property investment conference in the future.

For more information, visit www.wma.my/pic