Issue # 3
22
COLUMNIST
PROPERTY360DIGEST
PROPERTY360DIGEST
Issue # 3
23
Renters for life?
Dr Alan Poon
Housing affordability has been a bone of contention for the
longest time not just in Malaysia but the world over. The
recent Hong Kong protest which was triggered by the proposal
of extradition bill and have now veered off to demands for
freedom and democracy had also housing affordability as part
of the youth cry for a brighter future. Our nation current real
estate economy is doing no better with properties overhang
clocking a staggeringly high figure over the last decade. With
property prices increasing faster than household income
growth, homeownership is definitely out of reach to many
beyond just the poor but especially to the young millennials.
We may see the need to
shift our ‘home’ to suit our
periodic working needs.
There is a fear that one may not own
a house for their whole life and being
a renter for life. While that may sound
all gloomy and dark, as if one will be
homeless, being a renter is not all that bad
in the context of living if one is truly flexible,
mobile and adaptive to changing times and
needs.
Isn’t it that we were all once a child
where we stayed with our parents and
call that our home? Then, we grew up and
started to get busy with school and work
that we shifted our ‘home’ away from home
to be where we need to build our career
and life. And during festive seasons, we
still make way back to our ‘kampung’ from
where we used to spend our childhood
time and for those who are luckier with
the older generations still around, most
gathering will be at our patriarch ‘home’
where everyone congregates.
Therefore, ‘home’ can be defined as
where needs are located at a period in time
and not necessarily fixated to a place solely
because our needs change over time! In
terms of career where we spent most of
our adult working life in, we may see the
need to shift our ‘home’ to suit our periodic
working needs. Until and unless we decide
to call it quits and retire or settle down,
nobody knows for sure if we will ever move
our ‘house’ for greener pastures in life.
Noticeably, many westerners do travel
long term across continents and live
through their savings until a duration when
their reserves drop, they will then return
or make a living in the place of their choice
where they call ‘home’ before their next
travel adventure. Perhaps it is a cultural
belief that every Asians should own at least
one house in their lifetime. But having a
house and own it could be likely a thing
of the past if this ‘culture’ of moving along
with our need becomes a trend. A home is
indeed relative. Having said that, of course,
the most noble way is still to have some
form of ‘security’ to have a roof above the
head. But nobody ever said that the roof
must be our own.
RENTING AS A TENANT: A WAY OF LIFE
In current times, ownership is very
subjective and it is a measurement of one’s
affordability. Besides waiting to find the
right buyer, many would rent first and this
phenomenon will be here to stay. While
some may have a head start in life early
and even acquire more than they need,
there are those who only can rent and may
only look at real estate when they can only
afford to buy one.
Most if not all, started young and would
want to invest for returns especially the
first-time homebuyers. Do not be fooled
If everybody is only buying for own
stay and nobody wants to rent first,
the volume of transaction would
be reduced and this would not be
healthy where supply and demand
are concerned.)
into thinking that the millennials of today
are those who do not know what they
want in life. It is imperative to identify the
opportunity early and positioning oneself
into property investment. If everybody is
only buying for own stay and nobody wants
to rent first, the volume of transaction
would be reduced and this would not be
healthy where supply and demand are
concerned.
It is easy to believe that no property
investor would want to be a tenant when
they can invest into one for own stay and
other units to rent out to others instead.
This may seem like common sense that
investor is chasing yields and growth from
the asset they acquired right from start,
but many are not so lucky to invest in their
own homeland / kampung where they could
either be staying with their parents if single
or already bought a house much earlier
and settle down with family before starting
their investment journey.
As a matter of fact, it is only wise for
the investor buyer to focus on getting
their steady income from property
investment so they could eventually
cover their own property mortgage. Until
that happens, it does make sense that
anyone and everyone can rent as a way
of life since the benefits of renting do
outshine ownership especially when one
is still early in their property investment
journey. Added advantages would be also
to identify and experience how would
landlord behave before becoming one.
Renting as a tenant during the transition
of wealth accumulation is perhaps one of
the most overlooked traits when it comes
to homeownership. It’s time that truth to
be told to our younger generation and
first-time homebuyers. There is definitely
no shame to being a tenant and renting is
here to stay!
n Dr Alan Poon is the founder and CEO
of SuperiorWealth Resources Sdn Bhd, a
boutique wealth education and project
advisory company.
As the author of “Good Tenant,
Great Tenant” book series, Dr Alan is a
sought-after keynote speaker and have
been featured in most reputable media
platforms, and major property events
nationwide.
During his leisure time, this multiple
Award-Winning Entrepreneur &
Malaysia Book of Records Holder enjoys
travelling and seeks gourmet cuisines as
he appreciates the finer aspects that life
has to offer.