Sunday, 6 April 2014

Malaysian property valuation

There is some word, unpublicised as far as I know, that Bank Negara is looking seriously into the valuation practices of local banks.

Mainly the way in which loan sales offices shop around valuers to get the valuation for the loan because it could be one of the factors driving up property prices.

Well, in a way, yes it is a contributing factor but the margin of difference at which they are valuing is not really that large - based on observation, it is a fluctuation of about 5% to 7% in "hot areas" but true enough also that in low transacted areas, they can undervalue as much as 25% of the asking price.

Which begs the question of is the market pricing too high or are valuers judging at too low / judging too high in hot areas in order to get the deal to do the final valuation report?

After all, if they keep giving low verbal valuations, they will not get the business. If they give high values all the time, then it is an advantage to the seller and doesn't take into consideration of things like the condition of the property.

Anyway, what I heard is that BNM wants a split whereby mortgage sales officers cannot have access to valuers, rather it must be handled by a separate department who will liase with the valuer independently.

I think this is good in the long run PROVIDED every bank does this. So far, I think only some foreign banks do so.

However, this is only a halfway measure, I reckon. Better to be more transparent (ha ha, this is Malaysia, I must keep reminding myself) and have something like in Australia or US where the property and last sale details are open for all to see, so there are websites for you to do a price check independently. All it needs is the Land Office to open its database - or sell the information - and let a web developer do the interface and sell ads on it.

Everybody wins... except for the seller who is trying to get a high price on a dud house. If your property location is good and it is maintained well, then you will get a good price. If not, then don't expect to get a good price. It's as simple as that.

Seasons Garden, Wangsa Maju

The developer of the Damaisari semi-Ds and shoplots of Dataran Wangsa have put up a billboard advertising a condo called Seasons Garden, also in Wangsa Maju.

Scant details - only a website inviting registration.

Trawling through the chatter on Lowyatt, there is some mention of an indicative price of RM500 per square foot. Maybe based on the theme of this developer of doing fairly high end properties in Wangsa Maju - well, technically Wangsa Melawati.

So where is it going to be?

I have 2 guesses on a likely site:

The corner of Jln Wangsa Perdana 1 and Jln Wangsa (a.k.a Jln 6/27A) - this used to be an oxidation pond but has been filled in some years ago. The funny thing is that there used to be a big notice there saying that it was now private property but that sign has now disappeared. It is a good sized square plot for a condo, excellent location as it is on the main road and within walking distance of the Sri Rampai LRT and Wangsa Walk Mall.

The corner of Jln Wangsa Melawati 1 and 3 - this plot of land has been empty like forever and has matured trees that seem like they have been planted. Maybe an existing DBKL tree bank or something. Anyway, the reason why I reckon this could also be a candidate is because recently, some land surveyors were spotted around there, taking measurements. This location is also not bad, in terms of being inside the residential area BUT it is right next to a huge oxidation pond so that's a no go if you're planning to build a fairly high end condo.

However, given that the name of this development includes the word "Residences" means that it very likely has a commercial title, not a residential one.

Anyway, let's wait and see. I've registered myself so will wait for the launch for more news.

Friday, 7 March 2014

Net worth, argh!!

The ratio of your net worth to income is supposed to be 4.5 in order to be considered wealthy.

So if your income is 100,000, your net worth should be at 450,000.

I calculated mine recently and it came up to only like 3.2 times my income huuuu...

this is an edited post - seems like my previous version touched a raw nerve, got feedback that I was showing off apparently.

Well, it's my blog and I can say whatever I want but truth be told, it doesn't hurt to be circumspect too...