Friday, July 1, 2011

Book Promotion

To All Readers,

On behalf of the organisers, nutmeg publishing Sdn.Bhd, 
I wish to invite the general public to the following event:

KampungBuku Malaysia Melaka with the collaboration of Cheng Ho Cultural Museum will be organizing a BOOK TALK in conjunction with the 3rd Anniversary of Melaka’s inscription on the UNESCO World Heritage Cities List.

Date  : 9th July 2011 (Saturday) 
Venue : Cheng Ho Cultural Museum, Melaka
Time : 10.00 am - 12.00 noon

Entrance is free.

Registration by telephone (06-232 3308 – Norgayah) or email ( is encouraged for groups above 10.
Light refreshments will be served.

•Book Talk by Dennis De Witt
Author of “History of the Dutch in Malaysia”**, “Melaka from the Top”** and “Re-connecting Through Our Roots”.
** Copies are available at AnjungKaryawan Melaka, KampungBuku Malaysia Melaka. You can also order these books online at our website.

•Book Talk by Serge Jardin
Author of “Rever Malacca” 

Buying residential property in Malaysia — Aileen Han

July 08, 2011
JULY 8 — There is growing interest among Singaporeans in investing in residential properties outside the country following the fourth round of property market cooling measures announced in January.
The measures include increasing the holding period for the imposition of seller’s stamp duty to four years and lowering the loan-to-value-limit to 60 per cent on second and subsequent mortgages.
With a bullish Singapore dollar, favourable financing terms, geographical proximity, similar culture and background and, most importantly, family ties, Malaysia remains one of the top favourite property investment destinations for Singaporeans.
To help first-time investors, here are some things you should know about buying a residential property in Malaysia.
Know the type of property you can own
Malaysia allows foreigners to own an unlimited number of leasehold and freehold properties, subject to state consent. However, some are prohibited:
• Properties valued below RM500,000 (S$203,760)
• Land or properties with “Malay Reserved” status
• Agricultural land (unless above five acres and for commercial purposes)
• Properties assigned under Bumiputera quota
Market research
The Internet is a boon. So start your journey by finding out about the developer. Is the developer reputable, in strong financial standing and regulated by the government? Established developers are more likely to see through the progress of a project successfully, financial crisis or not.
If you find the price too good to be true, chances are the Internet will tell you why. Sieve through the clutter and learn from those who have gone through the pain.
Determine your budget and know yourself
While market research helps in making informed investment decisions, it is also crucial that investors know themselves.
Ask yourself the following questions:
• What is my budget and what are the financing options available to me? Malaysian banks offer as high as 90 per cent financing, so with a minimum 10 per cent outlay, you will be able to own a property quite easily. The question is: when do you start servicing your loan?
At property launches, developers often offer the Developer Interest Bearing Scheme (DIBS), which means it will bear the interest payable to the bank. So, besides the 10 per cent upfront downpayment, you would not have to pay anything until the date of completion.
But once the property is at an advanced stage of construction, DIBS is no longer offered and you will have to start servicing your loan. Some developers also absorb legal fees for the sales and purchase agreement, loan agreement and stamp duty. Combined, these can be great savings for many, so be sure to ask.
• How much do I have as buffer? The property price aside, you need to set aside some money for legal fees, documentation, monthly maintenance fees, renovation/furnishing costs, annual taxes, etc. In some cases, you may even need to start servicing your bank loan interest.
• What is the purpose of this purchase? Is it a short-term flip or part of a long-term plan that may see it becoming your home during retirement?
• Where am I right now? While risk tolerance is a key factor in an investor profile, so too are an individual’s personal circumstances.
Where an individual is at different stages of one’s life greatly influences the risk/return decisions that are made.
If you are young, chances are you will be in the accumulation cycle (building a home, starting a family, saving for an emergency fund, etc), you should focus on relatively high-risk, high-return and capital-gain oriented assets. However, if you are in your mid to late stages of your career (consolidation cycle), your priorities will change.
By knowing who you are and what you can afford, you are taking a calculated risk to arrive at a better decision.
What are the hidden costs?
Taxes are always a concern for foreign property buyers and the situation in Malaysia is no different than anywhere else.
There is a real property gains tax of five per cent imposed on capital gains of a property that is sold within five years from the date of purchase (the date of the sales and purchase agreement). Property owners are also required to pay the annual minimal quit rent (“Cukai Tanah” in Malay) and the twice-yearly assessment tax (“Cukai Pintu” in Malay) on their properties. The non-resident individual tax rate is 26 per cent and rental income is subject to the same tax rate.
Site visit
Once you have shortlisted your choices, a site visit is key to making the final decision. If the property is yet to be built, walk the streets, speak to locals and find out about the prospects of the area. If the property is in the process of being built, you are in a better position to assess the quality of the building materials, furnishings, specifications, etc.
Update yourself on developments to fully understand the upside potential of the investment. With the Economic Transformation Programme (ETP) in motion to transform Malaysia into a high-income nation by 2020, some areas may be gazetted for future developments (such as railway systems) so it is a good time to ensure the property of your choice withstands the sands of time. — Today
* Aileen Han is country manager for E&O Property (Singapore), part of Malaysia-listed real estate developer E&O Group.

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