The myth that one should invest in property to take gain of capital appreciation in the long term is not always true. Condominiums and other strata-titled or communal type properties are especially risky because the overall maintainence and occupancy of the property plays a major factor.
.
What you are about to see in the latter part of this article is probably very familiar to many Malaysians especially those who live in strata-titled properties. This property in question is located beside the KESAS highway, across the highway from the Sports complex which hosted Malaysia's 1998 Commonwealth Games. The neighbourhood is matured and middle class. There is a shopping mall and a Carrefour beside the complex. Nearby is the International Medical University. With all these attractions nearby, what has gone wrong?
Built in the mid-90s in time for the Commonwealth Games euphoria, this is one of a series of condos with the same pre-fix name lining the stretch along Kesas highway facing the Games Village. The property's management has since been handed over to a very lively residents committee. Majority of residents are owners but lately many have moved out and there seems to be an influx, though a small minority of migrant workers moving in. Their presence is very apparent as they hang out frequently in the common areas.
Please be warned that the pictures below can be up-setting to some. Kindly exercise viewer discretion...
Since the beginning of the residents' committee take-over, security has been a major issue. Many units were broken into and since then, the commitee has taken a very strong focus on security. This may have eaten into the resources of the maintainence as you are about to see...
Residents could not remember if the buildings have ever been repainted since they moved in. Walls are peeling off and mold set into the surface.
Hygiene is also a major concern. There appears to be old clothing, used pharmaceutical contraptions and garbage strewn down the back part of the building which houses the units' kitchens and 2nd bathrooms.
Some lights appear to have blown off, apparently due to water seepages from the ceiling in this top corridor making the corridors dark, dinghy and dangerous for children.
The corridors' railings also do not offer much protection and it is easy for children to climb over and fall. The mouldy walls would probably assist the fall by being slippery.
In the evenings, the multi-purpose hall looks pretty well utilized with many residents taking part in badminton games and the squash courts are also well-patronized. Other facilities such as the Sauna and Gym which prominently advertised their opening times...
... appears to be locked...
The library in the same clubhouse, though unlocked...
.... appears to be sacked...
It is highly unlikely that residents will be able to do much reading in this library under such conditions...
The once popular jacuzzi is not very appealing any more...
... same fate befalls the putting green.
The clubhouse also houses a cafe which serves affordable food and appears to be doing brisk business. The cafe faces the pool which fortunately still enjoys good use and in good condition.
Unfortunately, nobody plays tennis anymore...
I understand that value of this property has plunged by as much as 20% since. The beginning was obviously very promising as you can see from the very strategic location and the vast list of facilities offered such as swimming pool, tennis courts, squash etc. The moral of the story in buying strata-titled properties is not to fall into the offer of so many facilities which will become a maintanence issue in the future. Probably half the facilities and being well-maintained would be more appealing.
I understand that value of this property has plunged by as much as 20% since. The beginning was obviously very promising as you can see from the very strategic location and the vast list of facilities offered such as swimming pool, tennis courts, squash etc. The moral of the story in buying strata-titled properties is not to fall into the offer of so many facilities which will become a maintanence issue in the future. Probably half the facilities and being well-maintained would be more appealing. .
As I mentioned, this is a very typical scenario in Malaysia. We do not have a strong maintenance culture which results in high end condominiums turning into dumps. In the earlier part of this blog, I have highlighted how a lower middle class condo in Bangkok is managed - and with much lower maintenance charges. This shows that there really is no excuse. A well maintained property can be executed. It just takes the right skills and attitude to do it.
.
Be careful what you invest in!
2 comments:
Hi,
may i know how to choose good maintenance team apartment or condo?
do u think medium cost or flat apartment is hard to maintenance?
thanks
since the strata title act came about, many companies turned up passing as building management experts. these are usually RM2 companies set up to take advantage of the brisk business. i think one should let the experts do it, choose those who have been managing buildings for many years. they are accountable and responsible because they have a reputation to keep. it may cost 10% to 20% more but will be worth it. another problem with strata properties are the owners themselves. they are too stingy to hire a professional building manager so they do it themselves. as a result, i have heard of people attending MC meetings arguing to the point of calling names and throwing chairs - nothing gets done.
Post a Comment