Sunday, 8 June 2008

Mortgage Refinancing ~ Buying Additional Property

Buying a house is not to be a sole shelter anymore. It could be one of wise investment opportunities.. How about this.. Say 5 years ago someone bought a property at RM152k and now its value jumped to RM210k.. 5 years back, interest rate at 7% (6.75%+0.25%). 30 years 90% loan had cost him an installment of ~RM1k per month. Now many banks offered very good rate, for instance BLR minus up to 1.85%.. If he refinance the property with flexible home loan with an option of free moving cost (FMC), and he gets 90% loan of RM210k house value, his installment will be at ~RM900 a month. And he will get roughly RM60-70k nett considering his full settlement with previous bank at RM130k-140k. That is a handsome sum.. Forget about he will prolong his house repayment period at the flip side.. That is why he should look for flexible loan which will enable him to make pre-payment at any time.. Definitely his income will be increase in future. If he maintained his lifestyle or increase it by a lil bit only, he could channel all his salary increment into the home equity and lessen its repayment period.. Brilliant strategy rite..? Now, what he can do next..???? Precisely...., buying the next property... Say, buying a condo or service apartment in good location, he will need at most RM15-20k as a down payment.. And he still have a balance of RM40-50k which he could spare it as an additional fund to repay the new housing loan at least for 3-4 years... Again, his income will increase in conjunction of first 5 years... So, he should not worry of being unable to pay the installment... And that second property will increase in value in the next 5 years off course for another refinancing exercise.. :) Indeed, he can rent it out as well.. If fully furnished condo/ service apartment at prime location, someone will be able to rent it out up to 2k a month.. See, he is making money out of it...

Saturday, 7 June 2008

Pump Price Goes Up

Another bomb shell dropped by Abdullah administration.. A whopping 78 cent increase in fuel prices.. My goodness!! I am one of millions Malaysian who shocked, angry, piss off, cursing government for a steep incremental of pump price.. I am not defending myself as an excuse to suck government subsidy or as an excuse to deny what always been touted by corridor of power, Malaysian can't be always in circle of comfort zone.. Damning statement..
OK, simple as this.. Malaysian not stupid or brainless to think... Just make it gradually increase..!!! Simple... The reason is, off course, not only fuel price, but people are more concern of spiral effects as a result of steep pump price increase.. Consumer goods, transportation cost, vehicle maintenance, services are all expected to go up. Only stupid creatures will say and guarantee, there is no price hike. Obviously all this will lead to highest ever inflation.. That’s direct impact.. As far as indirect impact is concerned..., investors might think that Malaysia is not a good country to invest or expand their businesses anymore, especially manufacturing sectors. With high cost in fuels and electricity, raw materials cost will increase too, and no more competitiveness..
We cant compare with Thailand or Indonesia because they are not an oil exporter countries. We are... And please please... do not compare with Spore... or even UK..
This is because, their income is higher than us. Per capita income of course.. Or in laymen term, what they earned, can buy hundreds times more than what we are in Malaysia.. Or example like this.. Fresh grad in Malaysia earned RM2.5k, in Spore SGD2.5k, in UK, GBP2.5k. Some of the price comparison to open everybody’s eye;
1. In Malaysia
>> Petrol - RM2.72 per liter
>> A loaf of bread - RM2.10
>> 1 liter fresh milk - RM4.50

2. In Spore
>> Petrol - SGD2.2 per liter
>> A loaf of bread - SG0.90
>> 1 liter fresh milk - SGD1.8

3. In UK????
>> Petrol - GBP0.97
>> A loaf of bread - GBP0.40
>> 1 liter of fresh milk - GBP0.60

That was a simple comparison... See how powerful their purchasing power compared to Malaysian..
OK, now I talk a bit about the compensation or refund or channel back the subsidy to rakyat..???
RM625 a year for car owners of 2 liter and below.. Is that enough...?? Far cry from enough... Malaysian spent 25kkm in average a year. That translated into 2500 liters a year. 78 cent increment means RM1950 additional cost per annum.. Far far far cry from 625 per annum.. + 200 rebate of road tax, still 825.. and it’s not enough.. How about domino effect likes consumer good price increase and other services which definitely will increase too.. Government warned business people folks not to increase the price..? How dare..? Again, only stupid creatures will say that.. Are they in business for the sake of doing national services..? Selling things without profit.. Come on... Use brain when talk and provide facts...
All in all, it was not a wise move...