My Experiences: Safety and Security Always the Priority

Sunday at around 5 am, I completed my blog titled Hartanah Sebagai Perlindungan dan Pertumbuhan Kekayaan which can be loosely translated as Property as Wealth Protection and Growth. After slept for a few hours and spent some time with my family, I spent the night to do some work for my official job. I had to postpone my plan to translate the material to English language due to the workload.

One of the main topics I discussed was what will happen in 2014 in property market. One of the items being mentioned was the rental fee will keep increasing. In fact, the rental fee will increase much faster provided the landlords in the surrounding area realize how bad it is the lack of houses for rent in the area. I predicted for gated and guarded terrace house, the rental fee may go up to RM2,000 per month. Unfortunately, on Monday morning at about 3 am, a burglar attempted to break into my car as shown in the pictures on the left and below. I was lucky enough I have not slept yet. Immediately when my car alarm was triggered, I stormed out of my house to expel the burglar. As I mention in the previous article, burglary, robbery and snatch thief are still common occurrence in Johor Bahru. I parked my car outside of my house since I thought I will have another business to attend to at the night before. Based on this experience, once my gated and guarded cluster house is completed in 2015, I will rent it out for RM2,500! No less. If not, it is better for my family to live in the new house. Beside safety and security, the gated guarded township includes swimming pools, gym and a few outdoor sports facility.

Nowadays, it is much easier to predict the worldwide economy than predict a crime to occur in your neighborhood. My own experience shows that it is very important to choose a quality property. The criteria may be different. But the general idea is always the same. In my case, the quality criteria is to ensure my family and belongings are fully secured either in daylight or at night. If you are struck with this kind of unfortunate accident, your property are affected, you have to spend some time and energy to make police report and repair your property. In addition, your psychology suffers for a few days. In other words, your lost is multiplied several times! This also means even the crime is small, the economy repercussion is much bigger than the physical calculation. This also means no matter how small a crime is it is bad for the economy of the neighborhood and country.

You can hedge the economy by buying properties as much as possible. But, it is hard to hedge any crime from happen to your family. The best precaution you can do is to live in a gated and guarded township. You should make sure your house is as close as possible to the shops, malls, public institutions etc. so that you really know the surrounding area whenever you want to do or buy something.

When I was an undergraduate student, I wrote an extended essay about why there are more crimes in urban area or cities compared to villages. One of the reasons was people spent less time in activities to mixed together. As a result, the community does not really knew each other. When unknown people move around the area they can be potential suspects for crime. However, living in modern society where people are getting more specialized to increase their value, they have less and less time to spend time with each other. Therefore, the only long term solution available is to live in a gated and guarded township. However, little did I expect in the future (now) these type of crimes will become so common in Malaysia!

Anyway, as an investor, I prefer to select quality properties rather than having large number of properties. With more properties, I have to spend more time to entertain my customers whereas I already have a good full time job. A quality property also means the property price can easily increase its value overtime. Thus, it is better to keep the property than flip it. In other words, I am a long term investor, not a flipper. But this does not mean I am not going to sell my property if the offer price is very attractive. I always believe to be successful in the future, I always plan for a long term return rather than an immediate return.

A high quality property also means less headache with tenant idiosyncrasy. My first investment was a medium low cost house. Since it was a low quality property, the tenants were also from lower quality of people. From 16 years of investment on this house, I accumulated more than 12 months of unpaid monthly fee. For the past five years, the township has become very high quality properties. As a result, I can easily get high quality tenants. And I don't have any unpaid monthly rent anymore.

Additional information on why a gated and guarded houses are getting more important.