There are several perils in real property investments that Mr Wang is not comfortable with. Mr Wang is especially uncomfortable with the idea of making real property investments in emerging markets where you yourself aren't based, probably don't have local knowledge and cannot conveniently keep track of what's happening.
Today the Straits Times has an article featuring the unfortunate situation facing some Singaporeans, some years after they had invested in resort condominums in Johor. Over time the entire condominium complex degenerated into a slum of a ghost town, with large numbers of residents moving out. Then came the spectacular plundering that the criminals of Johor are so famous for.
Feb 20, 2006Mr Wang recommends that the next time you want to invest in real property, consider REITs.
Resort homes in Johor ransacked
37 flats owned by S'poreans hit as thieves take even windows, wiring
By Arlina Arshad
SINGAPOREAN businessman B.T. Ong, 53, got the shock of his life when he visited his Johor resort condominium in December.
The metal staircase railing leading to his third-floor unit at Anjung Seri Condominium in Bandar Seri Alam - an hour's drive from Singapore - had been sawn off and the light fixtures and electrical wiring removed.
The two-bedroom apartment, bought with his brother 11 years ago at RM209,000 (S$92,000) as an investment, had also become an 'empty shell'.
Thieves looted everything - from the sofa bed and curtains, to the air-conditioners
and an electric fan. Even fixtures like kitchen cabinets, wash basins, taps, wooden doors and sliding glass windows were not spared.
'My condo looks like a construction site now. Everything has disappeared. They only forgot to take my floor tiles,' said Mr Ong, with incredulous laughter.
All 199 units in the condominium, including 37 owned by Singaporeans, were plundered by thieves last year.
Developed by Resort Habitat Sdn Bhd, the units had cost RM150,000 to RM400,000 each.
But in 1995, the company faced financial difficulty and left two of the five blocks incomplete. Two years later, the Asian financial crisis hit. Many Singaporeans and other foreigners moved out.
The condominium fell into disrepair: Lifts were not repaired, the swimming pools were not cleaned, rubbish was not removed and paint was left to peel.
The exodus continued until, by October last year, only a handful of residents were left. Since then, residents returning at the weekend have found their units broken into and belongings missing.
But large-scale looting was believed to have been carried out in December, said residents' committee spokesman Jackson Chia, a 62-year-old retired Singaporean businessman. By that time, everyone had left, said Mr Chia.
'We have suffered great losses. I regret buying the unit. What was meant to be a dream retirement home has become a slum,' he added.
On Dec 8, residents were told by liquidator SC Corporate Recovery Sdn Bhd that the current developer, public-listed Anson Perdana, had become bankrupt.
They were told to pool resources to refurbish the condominium so they could sell it to a new developer or rent the units out, said Mr Chia.
Ten days later, more units were looted. Then, on Jan 8, residents found the doors, windows, wire cables and even Tenaga Nasional Berhad's generator and compressor, ripped out.
At least 40 reports were lodged with the Johor police, but the looting did not stop.
So, in January, they wrote to Malaysian minister for housing and local government Ong Ka Ting, and made a copy of their complaint to Malaysian Prime Minister Abdullah Badawi and Johor Chief Minister Abdul Ghani Othman.
The Johor police are investigating the matter.
Businessman Loy Jit Meng, 62, told The Straits Times residents should be compensated because developers had failed to safeguard their interests.
Mr Loy paid RM267,000 for his two-bedroom unit and spent RM40,000 on renovations.
'Since 2001, the lifts have not been usable and the pool has algae swimming in it,' he said. 'Now, why should I spend more money to refurbish my condo if nobody is going to guard it? I may be burgled again.'
2 comments:
Good lesson. If you cannot pay someone to manage the property for you, this is not a game you should play.
There's this gated community with golf course in Malacca. I went to one of the bungalows there and there were huge ants crawling about - apparently they were the dominant species around, since most of the absentee tenants were presumably S'poreans who had not turned up to warm their houses often.
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