Investing in properties beyond our shores

Tweet

Stories by LIM CHIA YING chiaying@thestar.com.my

In the past, only wealthy Malaysians could afford to buy homes in London, New York and other world leading cities. Today, an increasing number of higher and middle income earners are buying properties abroad.

COMPANY director P.E. Chua bought his first foreign property four years ago, paying A$350,000 (RM1.1mil) for a house in Melbourne, Australia.

“My daughter was seven years old then and I was worried about the 6% annual inflation cost in Australian education. So I thought it would be a good idea to invest in a landed property there instead of another property in KL,” says the 44-year-old.

Chua, who has rented out the Melbourne house, says he has the option of either letting his daughter stay there once she starts her tertiary studies, which could be another six or seven years, or dispose of the property to offset her education costs.

Chua is among a growing number of local investors snapping up properties abroad, finding the prices almost at par with or even lower than those in Kuala Lumpur and Penang where prices have skyrocketed in prime locations.

Apart from Australia, Britain and the United States have also become real estate hotspots for Malaysian investors hoping to spread their property portfolio.

Real estate firms with international partners have been aggressively promoting new housing projects overseas, placing prominent advertisements in local newspapers. Every other weekend, a property showcase or seminar is taking place in the Klang Valley and the crowd that turns up is an indication of the interest shown by local investors to diversify beyond our shores.

Another investor, K. Devaraj (not his real name), says he bought a 600sf studio apartment in central London two years ago for £400,000 (RM1.9mil). He considers the invest­ment worthwhile as the price has since gone up.

“My son needed a place to stay while studying and I bought the place partially for investment,” he says. “I have no regrets as my son may just stay on even after his studies. So, it is likely I will keep the apartment for the long term.”

Like Devaraj, many Malaysian buyers are taking advantage of the current economic situation to pick up some good buys. The interest shown by individual investors is not surprising considering that our Employees Provident Fund has picked up premium British properties worth a total £634mil (RM3.1bil).

On Friday, Star Business reported that Lembaga Tabung Haji and Per­mo­dalan Nasional Bhd are also looking for premium properties for their yield, with London as their first choice, followed by Australian cities.

Henry Butcher Malaysia director Lim Eng Chong says that as local prices get higher for Malaysian buyers, overseas properties are deemed not so pricey any more.

“Apartments in London, for instance, can be quite affordable; in 2009, a unit may just cost £115,000 (RM721,041). The finishing is just as good, if not better than local properties,” he says.

“I think Malaysians have always had a disposable income but it is only in recent times that they have become more savvy.”

Jalin Realty International Pte Ltd chief executive officer Ian Chen concurs, noting that while Malaysians have invested overseas for some time, it is only in recent years that the pace has picked up.

“It makes financial sense for parents to buy a place where their children can stay while studying instead of renting a place. Some already have friends and relatives living in the foreign city, and they ask: why not invest in a unit too,” says Chen.

Established over 30 years ago, Jalin ventured into marketing overseas properties five years ago. Its core market is Australia, where it is partnering conglomerates like Lend Lease, Australand, Frasers Property and other boutique developers to market their properties.

In the United States, the credit crunch since 2008 has led to property prices plunging. With lower prices and a weakening dollar, the US property market has become attractive to foreign investors, among them Malaysians, according to international property investment firm Robert Douglas.

In some places, says its head of sales and marketing (Asia) K. Daniel, prices are so low that one can even pick up a three-bedroom house from RM150,000. A good suburb location would cost RM200,000 onwards compared to RM700,000 back in 2007.

“For that property price, you can get back a monthly rental of between RM900 and RM1,000. Most of our clients are from middle to high income Malaysians, well-educated, aware of the global economic situation, the currency market, have a good investment portfolio and are ready to diversify,” he says.

Henry Butcher Malaysia’s international real estate general manager and business development general manager Jazmine Goh points out that potential customers would usually have done some research themselves or have friends or relatives check out the site.

For first-time investors, she adds, there are rental management experts to assist in managing the property.
Chua admits to being cautious before buying any property. In his case, he relies on Jalin Realty to over­see his Australian investments as he cannot be there physically to handle them.

“Everything has worked out smoothly so far, with the rent banked into my account every month. There is also protection (insurance) against default by the tenant or damage caused and I feel I can better trust the property managers there than here,” Chua shares.

“Owners like us want peace of mind when it comes to rental returns.”

His advice for first-time buyers is that they need to know their objective and reason for investing overseas. Such investments could be made in preparation for their children’s future education or if they plan to retire or migrate, he says.

But Chua cautions against buying to speculate.

“There’s the currency (fluctuations) and other calculated risks to take into consideration and tax rates to be wary of. Buyers should also have holding power to allow enough time for a property to mature. And most importantly, get a trustworthy agent,” he says.

“It can be worth it on a medium to long-term basis, but I would advise against a short-term commitment as property disposal overseas is not that straightforward.”

Chua regards overseas investments like his as affordable so long as it’s dollar-for-dollar and one does not convert.

Another investor, who wishes to be known only as Vincent, says it can be a hassle renting out a house in Malaysia.

“Good tenants are hard to find and you have to personally deal with problematic tenants who give you a headache,” says Vincent, who owns several properties in Australia.

“With overseas properties, you have property managers to handle the lease and there’s protection for owners. Also, I don’t think rental returns here are that good anyway, even in upmarket locales.”

Chen says a huge advantage about property buying in Australia is the reliability of property management there. Property owners need only engage property managers who will help to look for tenants and manage the rental collection and renewal of tenancy agreements.

“There’s also a landlord protection insurance that protects the landlord in the event of loss of rental (delinquency in rental repayment), property damage or theft by the tenant,” he adds.

“Owners can thus invest with peace of mind knowing that the property is protected and in good hands.”

M’sians buying up properties abroad thanks to lower exchange rates

By LIM CHIA YING sunday@thestar.com.my

PETALING JAYA: More Malaysians are snapping up properties overseas as they take advantage of the lower exchange rate in countries like Britain and the United States to spread their investments or shop for holiday homes.

A check with several major agents marketing international properties here showed that the number of Malaysian buyers has been climbing steadily over the last three years, peaking in the first half of this year.

With property prices in the Klang Valley and major cities and towns here soaring, those with cash to spare are turning their attention to properties in countries affected by the global economic crisis where prices have dropped.

Among the more popular investment spots are London and its surrounding districts as well as university towns in the US where there is a market for rentals.

Australia, despite its high exchange rate, is also popular due to the good investment returns and stable property market.

Henry Butcher Malaysia director Lim Eng Chong said Malaysian investors were getting more savvy and the buying trend was now heading towards a more global outlook.

“Malaysians and Singaporeans are now the biggest overseas market after the mainland Chinese for prime properties in London,” he noted.

Between January and August this year, the company sold over 100 properties in London, mostly new apartment units to Malaysian buyers. The properties were priced from 200,000 (RM965,382) to 2mil (RM9.65mil) each.

In 2009, about 100 properties were sold while some 150 were sold last year.

“Previously, there was interest but London was out of reach for many Malaysians. Then came the collapse of Lehman Brothers three years ago. The pound became cheaper, spurring more Malaysians to invest there. Many investors would already have enough (properties) on their plates locally, so they are now diversifying,” he explained.

Jalin Realty International Pte Ltd chief executive officer Ian Chen said about 50% of his clients buy homes for their children studying overseas while another 50% buy for investment or to keep as vacation homes.

“We are seeing many young Malaysian professionals investing in Australia, mainly to diversify their investment and to achieve early financial freedom. Australian properties provide much stability and consistenty in capital growth, with about 10% annual compounding growth,” Chen added.

He said sales had shot up 100% since the company ventured into the overseas market five years ago. Most of the properties sold ranged from AUD500,000 (RM1.57mil) to AUD800,000 (RM2.5mil).

International property investment firm Robert Douglas head of sales and marketing (Asia) K. Daniel said US properties in Michigan, Florida and Las Vegas were now popular, as they yielded high returns. Michigan and Florida were attractive because of their high student population which provided a ready market for rental properties.

“Malaysians usually buy to let (for rental returns). But if they wish to stay, there are no restrictions as long as they have the necessary visa, ” Daniel pointed out.

Malaysians who want to invest are advised to consider all aspects

By LIM CHIA YING sunday@thestar.com.my

PETALING JAYA: Malaysians who wish to invest in overseas properties have been advised do their homework first.

This is because they could be subjected to high government levies and taxes in cities where the properties are located, said Real Estate and Housing Developers’ Association Malaysia president Datuk Seri Michael Yam.

Yam also cautioned against buying for speculation, saying buyers had to consider currency risks.

They must also be aware that under a Bank Negara ruling, any large sum of money outflow must be reported and buyers should not have any borrowings with local banks.

Yam is however not perturbed over the global buying trend, saying it would not have much significance on the local property market as the primary homes for these investors would still be in Malaysia.

“While we try to attract foreign investors to invest here, we should not stop and discourage Malaysians from investing overseas,” he added.

Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia president Choy Yue Kwong said properties in Britain, especially London, were now popular because of the relatively “low” pound.

“As long as the exchange rate is in our favour, Malaysians will continue to buy (properties overseas),” he added.

PAS Deputy President, Mat Sabu, In the spotlight for wrong reason?

Tweet

In the spotlight for wrong reason

INSIGHT: By JOCELINE TAN

Mohamad Sabu’s provocative style is being scrutinised in the hot glare of the spotlight now that he is deputy president of PAS, and he is making news. 

IT was not surprising that Mohamad Sabu’s latest “eruption” happened in Tasik Gelugor, the rural Malay outskirts on the mainland side of Penang.

The PAS deputy president, better known as Mat Sabu, has his sights set on Penang in the next general election and Tasik Gelugor is one of the parliamentary seats he is eyeing.

The plan is one of those poorly kept secrets among Penang Pakatan Rakyat leaders who hope that the fiery orator who shoots from the hip will lend his weight in the defence of Penang and help the Chinese-dominated coalition connect with the Malay ground.

Provocative style: Mat Sabu’s shoot-from-the-hip political style is changing the image of PAS. He is seen here in a wheelchair with his wife Norma Alwi (left) arriving for a dinner-cum-ceramah not long after the Bersih protest.

Mat Sabu and Penang Chief Minister Lim Guan Eng are what some call NBF, that is, New Best Friends. He is the DAP’s idea of what a PAS leader should be. He speaks their lingo, does not always go around dressed like some Middle-Eastern citizen and is clued in on current issues. His political style is not very different from that of DAP leaders; he is a street-fighter whose speeches are as witty as they are about banging and slamming his opponents.

In fact, he has often told friends, “I am a bazaari (an Iranian term for street-fighter).”

Mat Sabu is without a doubt the most controversial leader in PAS today. He has been making headline news since becoming the PAS No. 2 in June and he is trying to make his presence felt in Penang where he was born.

The trouble is that he not only shoots from the hip, he also sometimes shoots himself in the foot.
His remarks about the Bukit Kepong affairs, made in the heat of a ceramah and used as an analogy of how history is often written by the victors, were one such instance.

Historical interpretation is not against the law but the tone of his remarks, coming on the eve of National Day, was tasteless timing and simply politically incorrect. And it is up in YouTube where everyone can hear for themselves what he said.

Batang Kali massacre [In Cold Blood - BBC]

There is no denying that he referred to the pro-Communist attackers in Bukit Kepong as “those fighting for independence” while the police personnel under attack were dismissed as belonging “to the British” and thus part of the colonialists. The fact is that home-grown policemen and soldiers fought alongside the British during the insurgency years and many died for their country.



Mat Sabu is not pro-Communist but his words came across as irreverent of the role of the security forces in the nation’s struggle for independence and against communism.

His Pakatan colleagues have defended him but he has been made mincemeat by Utusan Malaysia, which has devoted pages of coverage on the issue, and including reports of noted historian Prof Emeritus Tan Sri Khoo Kay Khim and DAP chairman Karpal Singh chiding him for his version of Bukit Kepong.

This is barely two months after his spectacular clash with the police during the Bersih protests. His knee, which he injured during the protests, has yet to recover and these days, he sits down when speaking at ceramah. The circumstances surrounding his knee injury is still a matter of dispute and even the injury itself is surrounded by mystery.

Immediately after the Bersih demonstrations, he had appeared at a string of high-profile functions in a wheelchair, claiming that a police Land Rover had rammed into him as he was riding pillion on a motorcycle. He was hailed as an injured hero.

It made the police look really bad, but when the police released a video showing otherwise, Mat Sabu’s attacks ground to a stop and he told reporters pursuing the story that he would respond to them in court.

He has since stopped talking about the incident and is now confronted by queries over his billing of the medical treatment for the injury to the Penang Water Authority of which he is a board member.

“But the most shocking part about the Bukit Kepong issue was that he said he could not really remember what he said. To me, that was more terrible than if he had really said all those things. A leader cannot say something and then a few days later, tell us he cannot remember,” said restaurateur Juhaidi Yean Abdullah.

Juhaidi recalled hearing Mat Sabu and several other PAS politicians speak at a ceramah shortly after the Al Mauna incident, where a cult of Islamic extremists had attacked a military camp, seized ammunition and then proceeded to kill the hostages one by one.

“They claimed it was a sandiwara (shadow play or conspiracy) engineered by the Government to discredit the Islamists. I remember feeling quite sad when the mother of one of those killed asked: ‘If it is a sandiwara, why has my son not come home?’” said Juhaidi.

A more thorough investigation of that tragic episode has been screened on Astro’s Discovery channel and it has helped put the matter to rest.

Drama king

But it does seem that Mat Sabu, like many of his friends who dominate the ceramah circuit, has a tendency to make dramatic claims and statements.

“He once told me that even if he is sick and down with fever, if you give him a microphone, he will recover and does not need to see the doctor. He is the sort of guy – you put a microphone in his hand, put him on a stage and he becomes a different person. But once the curtain comes down, he is back to his normal self,” said blogger Syed Azidi Syed Aziz, also known as Kickdefella.

Mat Sabu has always had a no-holds barred style. At the height of Datuk Seri Anwar Ibrahim’s sacking, Mat Sabu who has had issues with Anwar dating back to their days in Abim was going around, giving ceramah and talking about “Al Juburi”, which is Arab for the A-word.

The Malays call it mulut tak ada insuran (uninsured mouth, meaning that what is said could be libellous).
Not everybody likes his aggressive style, especially his habit of calling people names. He was deemed so controversial at one stage that he was not invited to speak at ceramah during by-elections.

There is no denying that Mat Sabu has a folksy charm and a certain boyishness about him although he is now 57 and rather overweight. He is a crowd-puller and PAS members flock to listen to him because they are guaranteed of entertainment. He is often the last person to speak so that the crowd will stay on till the end.

“His enemies are frightened when he speaks. At the same time, his style attracts the bullets of Umno,” said Harakahdaily editor-in-chief Zulkifli Sulong.

The Umno assemblyman for Ketereh in Kelantan, Datuk Alwi Che Ahmad, has a cynical but witty take on Mat Sabu.

“I will remember him forever. I became a political secretary to a minister because of him,” he said with a laugh.

Mat Sabu had contested against Tan Sri Annuar Musa in Nilam Puri, Kelantan, in the 1990 general election. It was a big fight with lots of ceramah going on. At one ceramah, the Kelantan-born Annuar had said in jest: “Why do you want to vote for Mat Sabu? He is an outsider. I am a local boy, more educated. I studied in two universities. I am taller and more handsome.”

Mat Sabu rebutted in similar vein at his own ceramah: “Anuar Musa is better educated, taller, more handsome but I am more popular, especially among the women.”

He went on to crush Annuar with a majority of 8,000 votes. Annuar was subsequently appointed a senator and minister and that was how Alwi became his political secretary.

Mat Sabu’s political enemies had been quite willing to forget the khalwat episode where he was apprehended with another woman in a Kota Baru hotel in 1995. After all, he had won a discharge and acquittal after two witnesses contradicted each other on the hotel room number.

But now that he is on top, his detractors are digging out the dirt again. A video titled Skandal Sexs Mat Sabu (sex scandal of Mat Sabu) has been making the rounds in the Ampang area. However, the video was apparently about another Pakatan leader.

PAS MP for Parit Buntar Mujahid Yusof accused the mainstream media of picking on Mat Sabu especially after he became the party No. 2.

“He has always been the sort to provoke, and he is bringing the party to a new audience. But why is it that in the last three months, he is always in the media? The media is manipulating it,” said Mujahid.

It is true the media is taking a more intense look at Mat Sabu following his rise in PAS; that is only natural. When one is up there, one cannot go on acting or talking in the same way as when one was down there.

And especially when one is the No. 2 in the party, everything said and done is scrutinised and analysed. Mat Sabu is learning that it is now harder to get away with outlandish statements. He will be held accountable because the public will read the statements as the party’s stand.

Mat Sabu’s latest trouble may also be connected to the way Pakatan politicians have been chipping away at the system and institutions like the judiciary, the police and security forces, and even the civil service. They have questioned the reputation of bodies like the MACC and the Election Commission. These are institutions which they believe have been unfair to them and which are standing in the way of their quest to control Putrajaya.

They are so used to criticising the police that Mat Sabu may not have realised he had stepped beyond the boundary when talking about Bukit Kepong.

The outcry over his remarks is not purely about politics. It is also because there are very few Malay families who do not have a family member or relative in the police or army. As such, criticism of these bodies is bound to hit sensitive nerves all over the place. There is a limit to criticising the men and women who put their lives on the line for our security and well-being.

But Mat Sabu, controversial firebrand and all, was the party’s choice. Members were disenchanted with the passivity of some of their ulama leaders and they saw in Mat Sabu someone who could push their cause on a more political path. He has given them their money’s worth thus far.

He is such a contrast to the studied style of his president Datuk Seri Hadi Awang although some wish that he was a little more like Hadi.

But Mat Sabu will always be Mat Sabu, and the roller-coaster ride he is taking his party on has just begun.

Malaya, look east to boost Malaysian racial unity!

Tweet

Look east – to boost racial unity

ON THE BEAT WITH WONG CHUN WAI

For the first time since 1963, we will celebrate National Day and Malaysia Day together. This should emphasise some points about our beloved country.
Image via Wikipedia
IT was just a year ago that Malaysia Day – Sept 16 – was celebrated as a public holiday to commemorate the date the country was formed.

In 2009, Datuk Seri Najib Tun Razak announced that Sept 16 had been declared a public holiday and that from 2010, Malaysia Day would be celebrated with activities that would foster the 1Malaysia spirit.

This year, it is even more special: With divine intervention, National Day and Malay­sia Day will be celebrated together for the first time.

This has been made possible by the fact that with Hari Raya Aidil Fitri falling on the last two days of August, it would not have been practical to hold the national day parade on the 31st.

A dual celebration would bring even greater meaning. It would also emphasise the point that there would have been no Federation of Malaysia if Sabah and Sarawak had not helped to form it on Sept 16, 1963.
Let’s get it right, Sabah and Sarawak did not join Malaysia, they helped to make Malaysia a reality.

Many young Malaysians in the peninsula wonder why they have to bring along their identity cards or passports when they travel to these two states or, worse, why they need to apply for work permits if they wish to work there.



This is a case of our history being badly taught in schools. Until today, our students are not properly told why these two states are different when it comes to control over their immigration, and their state administrative systems.

In the peninsula, state leaders are known as state executive councillors. In Sabah and Sarawak, they are known as state ministers. Both states, however, are led by chief ministers.

In the administration of justice, the courts in Sabah and Sarawak are part of the Federal court system but the Federal Constitution provides that there shall be two High Courts of coordinate jurisdiction – the High Court in Malaya and the High Court in Sabah and Sarawak, formerly called the High Court in Borneo.

But the most important focus of this year’s joint celebration should be this reminder that Malaysia does not comprise only Malays, Chinese and Indians.

Let us drive this point that in Sarawak, there are 27 distinct indigenous groups speaking 45 different languages and dialects while Sabah has 32 officially recognised ethnic groups with over 80 languages and dialects. Despite the diversity, there is racial harmony.

In many ways, those of us in the peninsula have fared badly in the area of race relations, no thanks to self-appointed guardians of our communities and morality too, in some cases.

The people of Sabah and Sarawak do not have any hang-ups about race. Take, for example, Datuk Seri Idris Jala, the Minister in the Prime Minister’s Department. A Kelabit from Sarawak, and a Christian, he has a Malay name. But this does not raise any eyebrow in the state. It is perfectly normal.

Another is Datuk Anthony Bujang, chief executive officer of the New Straits Times Bhd. He is a Malay from Sarawak but has a Christian first name. The accountant turned media boss’ name would not earn him any glance in his home state either.

It is well known that Sarawak Chief Minister Tan Sri Abdul Taib Mahmud has no qualms about opening churches, and he does this even in the middle of election campaigns. He has openly declared that he studied the Bible in school and his family has donated money to churches.

No Malay leader in the peninsula, in his right mind, would have dared to make such a statement unless he wished to commit political suicide.

It is in these two states that the spirit of 1Malaysia truly lives.

It is a joy to see people of all races sitting down together and enjoying their coffee in the old kopi tiam in these two states.

We need to see each other as Malaysians and nothing more. We need to remove racial prejudices and ignorance if we are serious about being 1Malaysia. Let’s make it a reality and not just a slogan.

Related posts:
Malaysia Day: Let’s celebrate Sept 16 for its significance!  
Malaysia's future: A time for Malay renewal ! 
Malaysia still in pursuit of full independence  
The true meaning of independence  
Reviving our winning ways