The answer is YES. As I always say, for property investor who is keep waiting for the right price to enter, stop dreaming and start take action now acquiring it. Remember, in property investment we need to buy and wait. Not wait to buy. The longer you wait the higher the price is. Landowner will definitely not going to sell you cheaper price next year if you don’t buy it now.
One of the main reasons why I say property price in KK will continue to surge is due to high rental yield which supported by strong spending habits. On average ground floor shop lot in KK is commanding good rental of RM2800-RM7000 per month depending on location. The best ground floor rental yield situated at Damai area, Gaya Street, Segama Commercial Centre, Sinsuran, and new commercial area like Lintas Jaya and Putatan. The whole block of three storey shoplot in Lintas Jaya costing RM900K-RM1000K easily can collect RM6K per month @ rental yield of 7.2% – 8.0%. Per annum. But why businessman willing to rent even the costing is high? Remember, as long as people spend businessman will continue to open more and more branches to cater the demand. Take a simple example, Coffee Bean, Starbuck and San Francisco Coffee is having 13 branches in Kota Kinabalu!! This shows the revenue generated is fantastic; otherwise they won’t have so many branches. Latest figure I got from my friend from Kuching, they only have less than 5 branches and yet struggle for surviving!
As we know, Kota Kinabalu is known to the world for their beautiful and white sand beach, coral, mountains and other local cultural events. Foreigners love KK especially from Korea, China, Singapore, Europe, Australia and etc. Their present at KK eventually supporting the property price as to them it’s too cheap. Beside that, the living cost is low for them. We can see clearly when Korean started to setup their embassy office in KK last year. They don’t stop there; they even started to join in developing our land into world class living place. Few of their property developments are selling above local’s affordability but too cheap for their own people. To name a few:
- Saturn Group from Korea – Developing condominium and landed property at Bukit Padang area selling price starting from RM700K for a unit of condominiums.
- Kim Gaya Group – Developing housing project next to Pantai Dalit Rasa Ria
- Philip Group – Kudat Riviera selling only to the “Rich & Famous”, starting price is from USD1M – visit www.kudatriviera.com
- Nexus Resort – World class destination for beach with condominium selling for USD200K
- More to comes..
If foreigner started to become local developers, why we can’t see the opportunity? Furthermore by the end of 2009, our upgraded KK International Airport worth RM1.4 Billion is ready for operation. Imaging if every country in the world added one flight per month to KKIA, the potential for tourism is tremendous which will boost our property market as a whole.
Kota Kinabalu is the capital city of Sabah surrounded by Tawau, Sandakan, Lahad Datu, Keningau, Papar, Kota Belud, Tuaran, Ranau, Telupip, Kudat, Kota Marudu and Kuala Penyu. To support my view on property price please answer my below 2 questions:
1. How many percent of people from outsider going to buy property in KK? I would say 70% or more of the people will come to capital city to invest in property.
2. How many percent of KK’s people going to invest outside of capital city? I would say 30% or less will go outside KK to invest.
Simple, if you are from KK, are you going to invest in Tawau property especially for residential and commercial? But that is not the end of the world, as there is other thing that you can invest outside KK that is vacant land. I love accumulating vacant land outside KK as the cost is cheaper. We will talk more in details about vacant land outside KK next session.
Population of Sabah reaches 3 millions people last year, but of course this including foreign works who works here. Do you know that foreigner who works here actually support our economy a lot especially property market? First they need a home to stay (rented our residential) and second they will spend half of their money for living expenses here (good for commercial property). So sometime I don’t understand why locals always complaint about them. Like I always say traffic jam is good as its mean the particular location is hot and highly in demand. That’s provided you own some unit there, but what happen if not? So make sure everything happen around is related to you. If not you can only complaint while people like me is harvesting the fruits!!
I will continue to update you all on the property mart in KK. So remember to take action before price when up further!!