As shared in last email, after we had identify the areas with success factors:
1. Location with Centre of gravity (Highway, LRT, MRT, BRT)
2. Location with Golden Triangle (live – learn – work – play)
3. Mass market property (local household income)

We then had to identify the properties with the following ChatPropertyMalaysia.com buying criteria in order to buy investment property in hidden potential area:

1. Below Market Value – > 15%
2. Rental Yield – > 6% or break even with monthly installment
3. Occupancy Rate – >70%
4. Take up rate for rent – < 2 months

Initially when we bought our first or two properties, we will need to view two or three times, come back think few times, then consider for few days.
Why, simply becasue we are still new, don’t have experience and not sure whether is it the right property or not! So much headache, want buy but worry these, don’t want then afraid of missing the great deal.

If you experience the above during the first or two properties, it is normal, but for subsequent purchase, we should able to decide fast within half and hour, whether should be buy or should not buy

Why, because we already had all the success factors and criteria set, if the property fullfil all the criteria, then sure buy! No hesitation.

Successful investor only look at the facts and number, and able to make right investment decision.

Eg: LP Apartmentat, Bandar Sunway

ChatPropertyMalaysia.com Success factors:
1. Location with Centre of gravity (Highway, LRT, MRT, BRT)
600m walking distance to Sunway BRT Station
Highway: KESAS, LDP, NPE

2. Location with Golden Triangle (live – learn – work – play)
Sunway Pyramid, Sunway Lagoon, Sunway Medical Centr, Sunway Tower Hotel
Taylor University, Sunway University, Monash University, The One Academy
Sunway Pinnacle office

3. Mass market property (local household income)
Only RM235psf, surrounding properties at >RM600psf – RM1000psf

LP apartment unit B6-06-10 info:

For this unit, owner allow to mark up
Purchased price: RM200k
Bank value: Rm250k
BMV: 20%
Cash out: RM25k
Rental: RM1200
Rental yield: 5.7%
Monthly instalment: RM1086
Maintenance: RM90
Total monthly payment: RM1176
Occupancy rate: 75%
Renting take up rate: 1.5 months
Property info: Leasehold (expiry year 2100)
3 Bedrooms 2 Bathrooms (850 sf)
Renovated with kitchen cabinet, two units air conds and two units water heaters.
Minor leaking only
No major repair

Does this unit of LP fulfil our ChatPropertyMalaysia.com criteria?

1. Below Market Value – 20% (> 15%)
2. Rental Yield – 5.7% can cover instalment (> 6% or break even with monthly instalment)
3. Occupancy Rate – 75% (>70%)
4. Take up rate for rent – 1.5 months (< 2 months)
5. Exit plan: Sell it at RM350k or more(within 3-5 yeas)

By analysis at the above success factors and criteria:
Within half an hour, we can 100% confirm that it is a class A property investment unit!

So, it a buy unit!

For this unit, owner allow to mark up, thus it is called NMD
If owner not allow to do mark up, this is called BMV, not NMD

What are the differences:
BMV is below bank value, cannot mark up, have to fork out some fund.
NMD is below bank value, can mark up, fork out some fund first, then can get back during full disburserment.

For first property, if we are, always advisable to start invest from small one first, for example medium low cost apartment. Worst case, even if make mistake it is still afford to lose some.

In the next session, we will share with you why we are buying properties in a JV group?