COLUMNIST
How to Occupy Your Property With A
Tenant... Fast
By Ikhram Merican
T he occupancy rate for residential properties in
A property that can fetch RM2,500 in
monthly rent will give you an annual revenue of
Kuala Lumpur is relatively low. It is significantly
RM30,000. This assumes it is occupied 100% of
lower in the high-end segment.
the time in a year.
Downward pressure on the economy, both
locally and globally, is not helping to improve
this phenomenon. The effect of low oil prices in
previous years has rippled through the Malaysian
economy with vengeance. The property market
has not been spared.
However, between new tenants every
year, this property could be vacant for a month.
This means the annual occupancy is 92% which
also means that your annual revenue averages
RM27,600 or RM2,300 per month
What if it takes longer to find a new tenant?
This is especially visible in the KLCC area
If it takes you 2 months to find a new tenant, your
and other luxury markets within greater Klang
annual revenue drops to RM25,200 or RM2,100
Valley, where job cuts in big Oil & Gas companies
per month.
including Petronas, have resulted in an outflow
of expatriates and lower occupancy rates.
This simple math establishes the all-
important fact that occupancy is very important
Occupancy rate is a key performance
for cash flow. As an investor, you must target
indicator of an investment property. Let me
high occupancy rates or in simpler words, you
demonstrate with some numbers.
must have tenants occupying the property as
frequently as possible.
So, how do you do this?
# Location
# Treat your property like a
business
# Realistic rental rates
# A manageable number of
RENs with good track records
# Creative models
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