Iskandar Properties: To buy or not to buy?

Read an interesting article about property purchase in Malaysia. With the statistics, it is confirmed that landed property is still the most transacted in Malaysia according to Coassets. The findings below shows the transaction between Q12012 to Q12013.

With so many condominiums sprouting up and many more rushing in, might be a good time to review your choices and considerations.

Once again, my concern for buying a property and especially condominium in Johor is as follows:

1. Malaysians don't buy condominium but landed properties. You might ask why this matters? Well, if you want to be able to cash out and liquidate, the only group you can sell to are foreigners like Singaporeans.
2. The Malaysian government has increased the foreign ownership threshold from RM $500K to RM $1 Million. That means if you want to cash out, you cannot let go of your property to any other foreigners for anything below RM 1 Million.  I don't think you can find any Malaysians willing to buy a condominium above RM $1million. 
3. Fickle minded officials. With such fickle minded officials, you get policies that are not carefully thought through and the impact to investors. It is just too volatile and uncertain. Imagine they even change the weekends suddenly from weekend to a Friday and Saturday.
4. No rental market. There's no rental market in Johor so far. The employment market in Johor is just not so great. Who are you going to rent to? Malaysians or expatriates? There's just not that many expatriates in Johor. 
5. Too much land in Malaysia. There are simply just too much land in Malaysia. You can keep driving till you fall asleep. Even if it is not enough, there's plenty of old buildings in Johor to be torn down and rebuild. Just look around and you will find no shortage of supply.  
6. Serious price gap between landed and condominium. The average current prices of condominium in Johor is now approximately RM $1100+ psf. The average current price of a landed property can be anything from RM $250-600 psf. That gap is simply too big and getting irrational. 

To summarise, I still think that Johor property is best bought for your own stay and not for rental. If it is for your own stay, buying a landed and G&G (guarded & gated) community is a better idea if security is a concern. It looks like a bubble to me so better be rational and not to be too carried away by herd mentality. History tends to repeat itself everywhere around the globe so I think this is no exception. Sounds like a bubble, feels like a bubble and it might just be a bubble.

London Property Bubble to Burst?

Looks like all the hot cities around the world is trying to curb property speculations. Now it is the turn of London. From Apr 2015, all overseas investor will face a property tax on any profit made. Currently it only applies to citizens and residents while foreign buyers do not need to pay any tax. The tax rate is up to 18% of any profit made while 28% for more expensive properties according to the The Guardian.

I believed this new policy will no doubt affect the London property prices as 18% tax is no small change for investors. 

Singapore Remains as 5th Least Corrupt Country in the World

Singapore has kept its position as the 5th least corrupt country in the world. We are surpassed by Denmark, Finland, New Zealand and Sweden in the Corruption Perceptions Index by Transparency International (TI). Singapore is the only Asian country among the top 10. Hong Kong and Japan comes in at #15 and #16 respectively. Japan at #15 is a surprise.

Westgate: Another shopping mall in Jurong

Looks like Jurong is really taking shape as an upcoming suburban shopping district with the opening of another mall. This is in addition to Jcube, JEM and the refurbished IMM. 

Singapore's Ranking in Pisa Performance

Here's the latest Pisa performance test for our students in all three categories in greater details. The surprise would be our reading is behind Shanghai and Hong Kong so I suppose the reading is referring to reading in their 1st Language.

Somerset Puteri Harbour Iskandar Johore

Keen to know what's the progress of Somerset Puteri Harbour development? This is close up of how it looks like. Taken from Traders Hotel that's just next door.

This is the view from Traders Hotel so it is likely to be similar when Somerset Puteri harbour is built. 

The hotel pools that even include an infinity pool. Hopefully Somerset will have one too.

Another high ranking for Singapore

Another high ranking for Singapore and this one I am really impressed. Singapore is the only Asian country among the top 20. The index is the World's Most Talent Competitive Countries by Insead.

Another Top Ranking for Singapore

Another top ranking for Singapore. Now Singapore is ranked number 3 in the Human Capital Index. This measures just how well we maximize the long term potential of its labour force. Singapore is the only Asia country in the top 10. Japan is the only one in top 20 (at 15).

UMLand having second thoughts?

With the repeated delays of the Matex Residence or the now called JB Sausanna, rumours are abound online about UMLand planning to revise the price. This follows the price surge in Iskandar and this might be too tempting for developers to be greedy and renege their committed selling price months ago. All it takes is some greedy developers to change the confidence of investors in Malaysia once again.  Well, this doesn't happen in most developed economies but for Malaysia, the risk is real. Will see if they screw it all up for themselves once again. 

Matex JB City and NSGlobal - A Time Bomb?

A fellow investor called up NSGlobal head of sales to enquiry about the status after 7-8 months of 'blackhole'. They got into an argument and the guy simply ask him to take back his booking fees if he is not happy. He says there's nothing he can do if developer don't update him.

This is the kind of service you get from them.  Let's see what their website says.

"NS Global’s success is achieved in part due to the its strong partnerships with international consultants and renown developers who provide first-hand information, giving NS Global the first-mover advantage for Singapore investors in many instances."

I do not know what first-hand information they provide. They can't even provide the most basic information and has no hold over the developer. It has been 7-8 months of no news nor updates and it is still counting. You be the judge!

Anyone has anything to share?

Property hotting up in Jurong Area

Looks like things are hotting up in the West especially in Jurong. Jurong Gateway was launched at prices between $1450-1650 psf. Why such a bullish prices? Let's take stock of what's happening or will happen there. There're the newer shopping malls like Jcube, JEM, Westgate (next year), Big box (if it happens) and older ones like IMM. It is right beside the Jurong East MRT station. There are two hospital currently being built, the Ng Teng Fong General Hospital and Community Hospital that's within walking distance. The area will also include a future hotel, redevelopment on the chinese gardens etc. Jurong East is to be developed into a major commerical hub (biggest outside CBD).

The price is also a good news for folks staying in the vicinity as it will also lift up the average prices there.

JEM or JAM?

The latest shopping mall has opened in the West and this time it is again in Jurong. There's already the Jcube early this year. If you want to drive there, better think again. JEM is really JAMMED. The traffic to the carpark is so bad that there's a long queue of cars waiting to just get in. I can't imagine when the other mall, the Westgate, is ready too. This place will be so congested.

Komtar JBCC at Johor Bahru City Center

Another property Komtar JBCC, is launched in Iskandar but this time it is in JBCC.  It is estimated to be completed by May 2013. Looks like they are all trying to bring in some form of theme park stuffs into their malls and this time it is angry bird. Iskandar is really looking like the theme park capital of the world. The location is good as it is near the CIQ, city square mall and the future Matex. All these will add to the vibrancy and redevelopment of the area.

  

Singapore to be Asia's most competitive City in 2025?

For a moment I thought this ranking is among cities globally but when it is only Asia, it doesn't seem too impressive after all. 2025 is about 12 years away. 12 years is a long time. I thought Singapore is already the most competitive city in Asia?

However, what is impressive is that Singapore will be the 3rd most competitive city in 2025. 

Ballots for Units in Iskandar's Afiniti condo

I just read that there's a ballot for the Afiniti Residences. 1570 people had registered for 147 units. Eventually 200 interested buyers showed up for 88 available units. The Afiniti is 129 year leasehold next to Legoland and developed by Pulau Indah Ventures, a joint venture firm between Temasek Holdings and Khazanah Nasional (The temasek Equivalent in malaysia). It probably has alot to do with this reason that many are interested.

There is a also a wellness center, a 33 storey Somerset Medini Iskandar service apartment, corporate training centre and retail. I am pretty sure the Somerset service apartment will do well due to the Legoland factor and the proximity to Gleneagles Medini Hospital. Both of which has potential to get many short term stayers.

That means now there will be 2 Somerset presence in the same region. One is in Puteri Harbour and the other at Medini. It appears that Ascott is optimistic about the Iskandar. Well, that optimism still appears to be centered around the hospitality sector. As for other commercial activities, it is still too early to tell.

The price is about RM850-RM1000psf onwards. On the surface it appears to be still low considering the launched price (above RM1000 psf) of other properties so far in the same region. However, this Afiniti is a 129 years leasehold so the comparison would be inaccurate. 

Matex Development in JB. What's happening?

What's the status of Matex development so far? After booking fees paid 6-7 months ago, nothing is heard of this project. You keep getting those NS global agents asking you to sign up for bank loans but when you ask them for the status, they can't really tell you. They can only say no news from the developer. Well, they should jolly well go find out. That repeat month after month which is totally unprofessional. Anyone got the same experience? Is there something we should be worried about?

Anyway, I have put up a poll on their service. Please feel free to vote.

Singapore to overtake Switzerland as tax haven by 2020

To understand how much money is parked in Singapore, this CNN article will give a good idea. Singapore has $550 billion assets under management as of 2011 whereas Switzerland has $2.8 trillion. This may change in 2020 where Singapore is likely to overtake Switzerland. This makes sense as we not only attract the Americans and Europeans but also the Asians. The wealthy asians includes the chinese, indonesians and indians. They would prefer somewhere nearer to Asia than somewhere half way round the world. Well, good future for your children to study investment, banking or wealth management.

GDP Comparison

Came across this nice chart (from IHT i think) that compares the GDP of various neighbouring countries and its population. Not bad for Singapore, a country so small has a GDP very close to Malaysia and philippines. That credit should go to the government. 

More investment to Iskandar

Some more investment into Iskandar and now from Pacific Star.  Pacific Star owns Xintiandi in Shanghai, Pavilion in Kuala Lumpur, Wisma Atria,Ngee Ann city, Capital Square and Temasek Tower in Singapore.

Press Freedom in Singapore

Not surprising that Singapore is ranked low in press freedom according to Reporters without Borders. However, being ranked 149 and just 2 spots ahead of Iraq and Burma doesn't look good for us. We are the lowest ranking 1st world country in terms of press freedom as far as i can see. When will we see the change?

Good $tuff$!!

Despite my criticism of our national media, they do produce rather good stuffs especially the money section.  I usually just skip the political stuff about Singapore as they are totally detached from reality.

One of my favorite stock is StarHub as it gives you really good dividends and it is very safe. They have their subscriber base and nowadays communication devices like mobile phones have become a necessity rather than luxury item. Most people will forsake certain purchases than terminate their mobile lines. And we haven't even talk about the internet yet.

If you have 10k StarHub shares, you will be getting about $498 per quarter or $1992 per year. Doesn't that beat savings or unit trust? Your money is working hard for you instead of just sitting in the bank. StarHub has been very consistent in paying out dividends over the years. I believe it is also where many fund managers put their investment too for lack of ideas to generate returns. It is a no brainer and a sure way for them to answer to their investors. I suppose that's the reason why the stocks have been going up and up. Otherwise, there's no reason for the stock to keep going up as the growth in Singapore is limited. The danger is that the share price could fall as it is at its all time high.

My criteria for stocks are:

1. Safe (primarily blue chips) 
2. High dividends

Other high dividend stocks.

Somewhere in China or Japan?

If you think that this 'iroming' board picture was taken somewhere in China or Japan, you are wrong. It is from right here in Singapore.  Saw this at our NTUC. 

Iskandar a gold rush or just bubble waiting to burst?

This is what i feared most. Everyone is rushing into Iskandar to build something just to sell and capitalizing on our greed (Singaporean's greed). A caption like 'Grow your Wealth' seems to be clear enough the motivation of the developer. There just need to be enough demand for such developments. Who will buy condos in JB? Only the expats or Singaporeans. Malaysian still preferred landed. So i ask myself the following questions:

Is there limited supply of land in JB? No
Is there a huge population explosion in JB? No
Is there an economic boom in JB like in China for manufacturing? No
Is there a big high end expat community in JB like in Singapore including bankers, traders? Definitely NO.
Who can you re-sell to? either Singapore or Expats mainly.

Well, i think moderate growth is good for all but unrealistic or overhyped expectations often resulted in bubble. A real boom needs to be built on some kind of strong economic foundation and not something artificial or made out to be. So far i do not hear of great demand but mainly of initiatives pushed out by governments of both sides as well as developers. Everyone is rushing in to build some kind of condos, including many developers new to Malaysia. That's what happened to Ireland where many estates have become ghost town. It is starting to look like bubble to me and it is starting to look worrying.

Singapore to KL high speed rail

This will surely bring the 2 cities closer together and increase tourism. Imagine going to KL in just 90 mins? That's even better for those that go to KL for business. This is really convenient. I am looking forward to that.

Another Theme Park in Iskandar?

Iskandar has snagged another theme park. This time it is the US Six Flags that plans to invest up to RM1.5B. It has double the size of legoland and will have 40 rides. Looks like Iskandar is on fire and on track to be the theme park capital of Asia!!  

New investments from Singapore into Iskandar

Another property developer is investing into Iskandar. They are going into it big time (for a niche player). Who is THM holdings? According to their website, they are niche property developer and their developments seems to be mainly landed properties. Just how big are they going into it? According to the press release, they are planning to build seven 25-35 storey tower blocks for residential and office space with 1.2 million square feet of net saleable area. In addition, they will have commercial properties consisting of food and beverage outlets that will take up 1.1 million sq ft of net lettable area. So just how big is 1.1 million sq ft? It is slightly bigger than Vivo city which is 1.04 million sq ft but smaller than Mid-valley KL which is 1.7 million sq ft. Is that sustainable with the rest of the developments coming up (Mid-valley Johor, Peter Lim's mega medical/entertainment development)? Let's see.

Wishing all a Happy New Year!!!

Wishing everyone a prosperous snake year ahead and good health! Hope all our investments turns into gold.

Singapore Airlines

The food looks like in any classy restaurant but it is actually on board an SQ flight. Having satay on the plane definitely reminds you of home. Another reminder that I can't really blog about food is because I always missed out one of the courses. In this case, the main course. I think i am usually too hungry and totally forgotten about it. By the time i remembers, it is already half eaten and doesn't make good pictures.

Can't help but saw some very noticeable wear and tear on the A380.  Seems like the A380 is a really popular plane and they are heavily used since it takes its first delivery on Oct 15 2007.  Looks more worn out than a 6 year old plane (could be younger as the delivery was staggered if i recall). The flight experience is really smooth and minimal air turbulence due to its size. Downside is the harder landing for such heavy aircraft.

Leading Asia News Channel?

I was following the Punggol election and saw this live coverage that puzzles me. How big is Singapore that our media needs to use such a poor live video feed system? I am not familiar with the world of broadcast but I can understand when CNN shows poor quality feeds, it is because they are in Syria, Afghanistan or some other remote places.  But how big is Singapore and how often is a by-election (who knows nowadays??) ? If we can't even provide quality in our own backyard, i think better drop the ambition to be a leading news channel in Asia.

What's happening to the Matex development?

With the johor government planning to restrict foreigners owning properties in Malaysia, i wonder what's happening to the Matex development in JB. The S&P is supposed to be ready by Jan 13 but now it is already Feb and there's still no news. 

Is there something we should be worried about? Will NS global bear the risk of any additional stamp duty imposed by the johor government for such delays? 

London's Battersea Power Station Property anyone?

I have been MIA for quite long mainly due to some heavy traveling. Anyway, since i was in London 2 weeks ago, i did a little bit of research on the Battersea Power Station project. 

SP Sertia is launching Battersea Power Station in London which is in Zone 1 but across the Thames river. London sounds interesting as there are lots of things you can do in UK. There are many world class museums, famous musicals playing everyday, rich history, beautiful scenery in the country side and many many more.

It was advertised at GBP343,000 for 400 sqft (non river facing) for a one bedder. This works out to be GBP858 psf which is about SGD1,629 psf.

The area is actually a regeneration of a former industrial area. This is how it actually looked like from afar.

And this from really far. Well, it is actually taken from the vauxhall station (bottom left corner of the map) as there isn't any underground serving that area now. In future, it is said that there will be a direct line to Leicester square.  That's a really a major plus point as Leicester square is a very popular place. Chinatown is there too for those who miss chinese food when abroad. Well, in London, you can find almost any kind of food there. It is really cosmopolitan and it is no longer just englishman there. You can no longer tell the city just by looking at the faces. It may be because of their lax immigration policy and many political asylum seekers.

On the other end of the river thames, you can see the London eye (from Vauxhall station).

Some views of the other properties near to vauxhall station. 

The last picture has nothing to do with the properties but it is just me enjoying a cup of cappuccino overlooking the Tower Bridge.

Is it a good time to buy a London property since now Sing dollar to the pound is at an all time high? I recalled the mighty pound was as high as 1 GBP  to 3 SGD during my student days.  Now, it is less than 2 SGD.

However, the gains seem to be eroded by the rise of the London property prices too. It could be just marginal gain over the years. There are many articles in the internet that says the boom is over for London properties (not until 2019). There're lots of theories to back this up and also further government's intervention. I think that's probably enough to adopt a wait and see approach.