Make an Investment in Real Estate in Malaysia Today
After a couple of bad years, the market of real estate in Malaysia has made a comeback. The sales started to slow down in 2014 and was not moving until 2016 because of their industry of gas and gas are failing. They had stricter lending rules established by Bank Negara which is the country’s main bank. In addition, there was a scarce supply while they completed luxury developments located at the pipeline. Although, according to experts it is now a very good time for an investment in real estate in Malaysia.
Become a Landlord
This is a long-standing real estate idea for a business because there are benefits to owning and renting out a property. You can:
- Make money from the cash you will receive from the rent your tenants pay each month
- The appreciation of the equity of your property over time. These gains are realized when selling the property.
Therefore, when you are a landlord, you make good cash and have a strong asset for investment. Actually, the business of becoming a landlord has been around since the medieval ages. It is when the lords owned the land and got payments from the ones who used it.
In the modern times, there are millionaires and billionaires created because of the real estate around the world.
Real Estate Crowdfunding
Crowdfunding is a basic concept about having an online website. It is controlled by a certified operator. It also facilitated by a particular ministry that matchmakes the investor and the issuer. The operator’s obligation is to do enough due diligence when it comes to the issuer and the product before allowing them to campaign. The campaign is for fund-raising on the online platform.
In this kind of investment, the major requirement is the issuer should either be a land owner or real estate agency. The land owner should be someone who owns a property to be developed. He or she also is looking for funds to complete the project. The operator can perform a land background check and the issuer should be able to show proof of ownership of the land and the proposed plan. The platform will be used to advertise their idea and attract investors.
Flipping a Property
This is a high-profile business idea to earn in real estate. It has been made popular by a couple of TV programs in the past years. The property flipping business involves purchasing a poorly maintained home, fix it and make it modern and then sell it at a higher price to make profit, usually to retail buyers. Even if house flipping does not offer a continuous cash flow like renting out a property, it can make you a large profit at one time on each property. A lot of general contractors purchase and flip 1 or 2 properties each year to earn extra income. While there are also real estate investors that are only interested in flipping properties. Similar to rentals, flipping property is also a source of continuous income if you want.
This idea is similar to buy-to-let and it is known to be the fastest way to have a passive income. All it takes is renting out a property for a low cost and then rent it out at a higher price to make profit. You make out of it from the difference of your rental payment to the landlord and what your tenants pay. For example, you rent an apartment unit that has 3 bedrooms and pay RM1000 and rent out 2 of the rooms to other people. You charge RM700 for the master’s bedroom and one room for RM500. The total income you have each month is RM200. This is only a small-scale example, which is good if you want to make a side income. Of course, there is also Airbnb which is a bigger thing.
Make sure the owner of your property gives you their consent to do this. It is crucial to make sure that your landlord is allowing you to sublease make an arrangement with them.
People have this wrong idea that you need to own the property for you to earn profit from it. In case you were wondering if there is a way for you to have a real estate business without owning a property, look into property management. As property manager, you will handle the maintenance, upkeep and even rent collection in a lot of cases. If you do these things for the property owner, they pay you a certain fee. Even if you could run this business from home, it is easier for you to have a location only for business. This is because you need a place where to store cleaning supplies, paint, and maintenance materials that are going to be needed in the properties you will manage.
Repossessed Property or Property in Possession (PIP)
In Malaysia, this is called a “lelong” property because it is a great business opportunity for other investors to buy PIPs from banks houses for auction. You can find a list of available properties from the website of the bank or property portal.
The goal is to have a negotiation with the bank. They can buy the property lower than the market value. It is so they can resell it at market value or even below it. By doing this, you are going to make a substantial profit. This is also not a fresh idea but it still works until today because there is always a market for property buyers and investors.
Since there are a lot of ways to earn in real estate, this is definitely the time to invest in Malaysia. Thinking of an investment in real estate in Malaysia will get you started on how to make it big in this kind of industry. There is always a need for property and profit which is why there is always a market for it.
To learn more, you can read about Property Investment’s Guideline for Foreigners in Malaysia.