As time goes by, the rental value increases. My income also increases steadily. So in 2012, I managed to make a full settlement payment for about RM28,000. There were times during economy crashed, I cannot make the monthly payment for 6 months! But there was nothing the bank can do since there were about a quarter of houses in the surrounding area were down under. Thus repossess the houses and auction those houses will not give much capital back to the bank. The best course of action by the bank was to advice me to do my best to settle the late overdue. I managed to do so in 1999 after about 6 months of my discussion with the bank manager.
After improving my financial, I bought my second house in year 2000. It was a strategic decision based on my long term goal. And I successfully used my second house to achieve the goal in the year 2013.
Last year, my wife want to sell my Bandar Seri Alam house for RM160,000 (read My First Property for Sale). Instead, I preferred to rent the house. Previously the house was rented for RM600. After a new tenant rented the house for RM800, my wife willing to hold the house. The following year (after 12 months contract expire), the rent automatically became RM880. My tenant paid timely every month. And they also informed two months in advance before they want to extend and end the contract. Thus, I have almost two months time to look for a new tenant.
Early this month, I managed to get a tenant from a company who want to relocate her executives in the house. But, I have to upgrade the house from half furnish to fully furnish. In return the company is willing to pay the rent for RM1,600. It was a good deal as long as the company will stay in the house for two years. I need at least a year to recoup my investment to buy furniture. So, the following year will be my profit.
As usual, I repaint, do some repairs and upgrade some of the available facilities before a new tenant stay in the house. This is to ensure the house is well maintain. If my new tenant continuously stay in my house for the same rent fee, how much do you think the house worth!?
It is always profitable to invest for a long term in property.
