Wednesday, June 29, 2011

Senza Residence beside the Taylors Lakeside Campus

Have you been getting many sms and emails lately from property agents advertising hot properties which are going to be launched soon? They are always in good locations such as beside a College or KL City center and also almost always over-priced. The pick up line is always the same, from every agent, that the project is very popular and they are reserving the last 1 or 2 units for me and have to decide by tomorrow or else they'll give it to someone else. Then the next pressure line is, the next phase will be launched at a higher price, usually 20% to 30% higher. So, I would like to warn fellow punters to take a grip and think many times over before jumping in. If it is really that good sales, they won't be reserving units for you, right?

Well then, assuming that sales is really fantastic, the biggest issue with this location is the access. Already we've high-lighted the problems faced by PJS7 residents due to the Taylors campus. As you can see from the map above (gleaned from the developer's website), the site together with the Taylors campus is land-locked.

The only feasible tenants are probably those attached to Taylors College. It is a tough sell... A 3 bedroom intermediate unit apparently goes for over RM550k. I am not going into the price per square foot yet... at this cost, one has to rent out the whole unit above RM3500 to make ends meet. If rented to students, assuming 4 students live here, it will cost them just around RM900 per head - obviously single rooms cost more. This is beyond the means of most students although admittedly Taylors College has many rich brats. So, this will obviously encourage up to 8 or even 10 students to pack into a unit causing them to be very undesirable neighbours. So families? Slim chance to get families to live here.

Monday, June 27, 2011


This morning I got an email from a property agent which almost caused me to fall off my chair. He is marketing a low cost apartment project located at Park51, Petaling Jaya which is right behind the Mercedes' Cycle and Carriage beside the Federal Highway.

This project is called Impian Seri Setia, developed by the Taipan Group. This low cost project consists of 650sf 3 bedroom and 2 bathroom units. They come without car parks but these can be purchased separately (in my opinion, apartment projects without car parks should not be approved by the council as people are very reluctant to purchase or rent car parks resulting in traffic congestion as residents park illegally outside the building and blocking traffic). Anyway, each unit is selling for around RM80k but it is quite possible to rent it out at RM700 per month in this high demand area. Therefore, attracting a rental yield of 8%.

Since I am an investor, the thought of an 8% return and an investment of under RM100k would cause me to quickly book 10 or 20 units without thinking. I suppose many people are doing this at the detriment of the lower income group owning their own property. Naturally, demand to purchase is high. That is why, the agent has very openly demanded a RM10,000 under-counter money to secure a unit.

But low cost units are not so straight-forward. The units are allocated to the purchasers by the City Council, in this case MBPJ (Petaling Jaya City Council). Therefore this RM10,000 BRIBE can potentially implicate that the state government is involved. I have reported this case to the state government and hopefully something will be done. The honourable State Assemblyman for Seri Setia has already promised a Press Conference. Let us see...

Friday, June 17, 2011

Sky Vista Residensi

Just launched, a low density development in Taman Pertama, Cheras which is just by the Bandar Tun Razak/Loke Yew roundabout. I have always liked this location because there is a nice Chinese restaurant at nearby Jalan Kuari and this is also where I used to take my cat to see the vet - yes, the DBKL vet service is here...

The location is not too far from the city center and there is a promised LRT station, which we will probably see the light of in the next generation... And apparently, this is a Freehold project (anyone to verify this?) but the rest of Taman Pertama is Leasehold. Neighbouring Victoria Condominium was launched in 2009 at just under RM300k for 3+1 room 1300sf units. No idea where they cost today but a recently completed Pertama Residency which only have 600sf studio units are going for RM300k per piece. Without car park!!!

But obviously, the target market for Sky Vista is families. Don't expect a great rental yield here as it is unlikely one would be able to get into the expat market here. This is definitely one for the short to mid-term flip flop strategy... There are built-ups from 1450sf to 1700sf. Normally, those punters like us who buy for speculation would straight go for the smallest unit... i.e. 1450sf below. But I think this will be the wrong strategy for this one.

If we all remember back 15 or 20 years ago, double storey landed link houses was the norm in the Klang Valley. There were the standard 20 x 60 or 22 x 75 and also the larger ones 24 x 80 or so.... Those who bought the smallest units probably regret that they didn't pay that extra RM50k or RM100k for the bigger sizes. The reality is, families grow, kids grow and they need more space. And as household income increases, people tend to upgrade and go for bigger units. So, the bigger type A (below) would most likely have the greatest chance of appreciation. And they are all bright and airy corner units which is a great plus.

However, as for me, I tend to go for the minority. In this case, it is the Type D which is also a corner, faces the pool and may even have a speck of KLCC view. This, incidentally is a 3 side frontage which means it has windows on 3 sides of the 4 walls - which makes it extra bright and airy... nice...

The developer is also unheard of, which sets in a risk factor as we are almost surely going into recession next year. And, at over RM600k for this location, this is totally untested. We are talking about Mont Kiara prices 5 years ago... and this is no Mont Kiara and will never be one... this is locals area. At RM600k and above too, one would ask why not buy one of those landed double storey links in Taman Pertama itself or nearby Taman Midah or Bandar Tun Razak? Well... good question... the answer, lifestyle...