Six months ago, a good friend asked about the price of a landed terrace house that he wished to sell.
However, upon being told about the price quoted by brickz.my, he said, “But the market price is higher.” He proceeded to show listings of other units that were above his asking price.
He was told however that when it came to property listing advertisements, anyone was free to quote any price they wanted, which most times had absolutely nothing to do with the market price.
When it comes to buying, only actual transactions count. No one gives any “respect” to the price you wish to quote, especially in a slow market.
However, despite being told this snippet of information, he asked, “Are the RENs rejecting to sell property nowadays?”
The answer is of course a resounding “no”.
He said after he approached some RENs and told them the selling price of his property, after which the RENs went silent.
When asked if he sent the RENs his “market price”, he said, “No, I already referred to the market price and lowered my price by 10%.”
Here is something you must understand: “The market price is supposed to be the transacted price. It is not the property advertisement listing price.”
All the same, his reply was that he was “sad”.
When the market is slow, it benefits everyone who’s taking advantage of the situation.
A seller may feel disadvantaged with the current market but the good news is that he too can benefit from the situation.
For example, so you have to sell your property at a lower price. But the truth is that after you sell it, you yourself can use the money to buy a potential unit at a lower price as well.
However, if the goal is to sell your property and put the money into a Fixed Deposit account, that’s another story altogether.
Of course, if you really cannot accept the current prices, the next option is to rent.
However, you must bear in mind that landed homes do not provide the best returns when it comes to rental returns.
It is best to just ride out the current situation by covering some of the monthly mortgage. The “storm” may be here today but will pass eventually.
The real question is what options you would want to take today. By the way, dilly-dallying on a decision does not add anything to your bank account.
If you sell with a profit of RM100,000 and put this into a Fixed Deposit, at least you will get RM4,000 per year.
With every month you delay making a decision, a few hundred ringgit is lost. Yes, it’s a buyer’s market today. But a seller can also be a buyer, right?
This article first appeared in kopiandproperty.com
Charles Tan blogs at property investment site kopiandproperty. He dislikes property speculators and disagrees that renting is better than buying. He thinks it’s either property or poverty. He is presently the CEO of an auction house auctioning assets beyond just properties.