Why Foreign Investors Love Iskandar

No doubt, the Iskandar Special Northern Development Corridor has become a a favorite amongst foreign investors. Already investment properties in the region have started to see returns that are very lucrative, some even before they have been completed.

Ever since its inception in 2006, the Malaysian government has made every effort to attract wealthy foreign investors, in particular those from Singapore to invest in Iskandar by offering excellent tax as well as other bonuses.

Currently, not only are Singaporeans keen to invest, but investors from China, Taiwan, Japan, Europe and the United States have been coming in droves to check out the prime investment possibilities in Iskandar.

There are many of reasons why Iskandar is such an appealing investment for foreigners.

1) Cheap Land

If there is one thing readily available around the Iskandar Region by the boat loads, it's land - virgin land that the government has delineated as freehold. With land becoming very scarce and more costly in Singapore, it’s a good idea for Singaporean firms to expand to Iskandar which is just across the Straits of Tebrau rather than to other regions like China. More Singaporeans are also taking up holiday or weekend homes in Iskandar as well. Again, it’s a good idea simply because they can get a landed property in Iskandar when it's even difficult to get a low-cost HDB flat in Singapore.

2) Cheap Labor

There is unquestionably talent aplenty in Iskandar. Businesses have the luxury of picking from the local talent at a very reasonable price. The local talent has the competence and knowledge which is comparable to Singaporeans as well. A number of them are even trained in  Singapore. And if there are any jobs that snobbish Singaporeans consider below them to do, such as manual labor and odd jobs, well there are many people who are willing to do it in Iskandar too.

3) Competitive Advantage In Exchange Rates

With the exchange rate in most countries is at least double the Malaysian Ringgit, it is just a no brainer that foreigners can invest at half the price of what they ordinarily would pay in their own countries and get double the earnings. They will save on their operational costs as well, therefore it is quite sensible for them to move their operations to Iskandar. For residential properties, foreigners could get world class landed properties as well as high end condos that come complete with the lifestyle suitable for the wealthy at a very affordable price.

4) Future Infrastructure Projects

Construction is already under way to build a high speed rail link that connects Singapore to Kuala Lumpur and it will run through Iskandar. This makes it quite convenient for people from either side of the causeway to travel. And since the link goes all the way to Kuala Lumpur, Malaysia's capital city, this makes it very convenient for business people to go for meetings.

Already new projects being proposed in Iskandar are getting excellent response from foreign investors. But what of the local investors? This is a big question mark on the minds of local investors as they don't see any competitive advantages for them to give some thought to Iskandar as a possible investment, in spite of the potentials that are available there. In addition to know what to invest in property in Iskandar, you also have to know where to invest.

If you would like to know more about how you too can be a part of the Iskandar opportunity, acclaimed Property Guru Milan Doshi and a panel of illustrious speakers will have a talk on the topic of property investment in Iskandar for local Malaysians. Organized by Wealth Mastery Academy, the talk aims to make Malaysians aware of the great potential that is in their own backyard. Click here for further details.

Property Investment Tip #2: An Innovative Property Investment Strategy

Do you make crucial life decisions based on the flip of a coin or the roll of a dice? Yet isn't this how a great number of people invest today?

We’ve known for years that investment market commentaries is dealing in ever shorter time frames.

The stock market is currently zig-zagging a little: down one day and up the next, which is occasionally a signal that a correction could be due.

Recently we noticed that “the Cyprus bailout proves that the economy is doomed!” but today we are instead assured that “Cyprus is unimportant” - what was a bad investment yesterday becomes a great investment again today? We now have minute-by-minute market commentaries and it’s indeed a crazy world we live in.

Market gurus love to have us believe otherwise, but the immediate future is not really predictable (check out what they were saying 12 months before). The key thing to remember as an investor is this:

The more your investment plan relies upon the market moving in your favour in the near-term, the greater your chances of failure.

The financial press repeatedly reports share markets declining as a time to panic and the index appreciating as something to celebrate. But what if you had an investment plan whereby it doesn’t even make a difference whether markets move up or down?

It was Warren Buffett who said that the best investors are those who create a framework for successful investing and then can prevent emotions from corroding that framework. This is why automated investing is so efficient for people who have a regular income. By acquiring shares regularly through buying a pre-determined dollar value each month or each quarter, the investor remains emotionally unaffected by market hype.

The method is known as averaging or cost averaging - when the market goes down you effectively buy a greater number of shares, and thus will profit over the long run. It is sensible in cases like this to obtain a well-diversified product so that there is no likelihood of the investment dropping to zero in value.

Averaging works in property too, but due to the leverage the individual purchases have a tendency to symbolize a more material part of your portfolio, it becomes more important for investors to avoid experiencing significant losses.

Likewise in the world of real estate, market gurus like you to believe that they can foresee outcomes that you are unable to, which explains the “I envisage no development for 22.5 months”-type poppycock and “a new milk bar is projected to open in 2014 that should fuel capital growth” baloney.

Fortunately for property investors is that unlike the bourse, which is priced rationally for much (if not all) of the time, residential property is really a frequently imperfect market. Therefore, there are a number of strategies that can be employed to outperform the median prices so beloved of the financial media.

The first thing you can do is buy counter-cyclically in a city which has not recently experienced a boom.

1) Buy property below its intrinsic value;
2) In an area that has a long history of strong capital growth;
3) Search for a property with a twist - something special, special, different or scarce about the property; and
4) Purchase the type of property where you could “manufacture capital growth” through refurbishment, renovation or redevelopment.”

By utilizing these methods, you can ensure that you aren’t simply leaving your results to the roll of a dice.

Of course, it still makes sense to track what is happening in the world.

The Property Outlook Convention aims to provide investors with the latest information on the current property market conditions and innovative property investment strategies. It is organized by Wealth Mastery Academy, a company committed to providing solid financial education and wealth creation strategies to the masses.

Property Investment Tip #1: How Leverage Can Make You A Successful Property Investor

When you purchase investment property, there is something very essential that you have to use if you want to become successful - LEVERAGE.

If you think that you can do it all on your own, it is going to be a very slow and painful way up. Prudent property investors constantly leverage on other people's time, skills and most important of all, money, to create a portfolio of investment properties that consistently generate money for them.

The fastest way to leverage is through the use of a bank loan. Let's keep things practical and assume that your investment property is valued at $100,000. If you were to pay cash for it, you will have to come up with the $100,000 on your own. Whereas, if you take up a bank loan, you probably only need to come up with about $10,000 and borrow the rest of the funds. And after that you rent out the investment property and your tenant will pay off your bank loan.

Just imagine if you were to purchase an investment property valued at $1 million or much more. How are you going to raise that kind of capital?

Yet another reason to use a loan instead of forking over the entire cost of the investment property is that in the future, if your investment property increases in value, you would have made a huge income. In the event that the investment property increases in value by 10%, it is possible to sell it off at $110,000, therefore you turn a profit by $100,000 given that you only paid $10,000 as the down payment and borrowed the balance. Now compare that to if you paid cash for the investment property. Your entire profit would only be $10,000 which is the sum that the investment property increases in value.

Obviously this is a very simple calculation, but in reality, you still have to consider other elements like prices, interests, legal charges and other miscellaneous costs that the sale and purchase of your investment property will incur.

Another way to leverage is with other people's skillset. This is where participating in a team can really be beneficial. Savvy property investors always socialize with other property investors. Sometimes, they contact developers together as a team and see if they can secure good buys. With more people in a team, they can each bring something to the table and have the ability to make better decisions when it comes to selecting investment properties to purchase.

Furthermore, not everyone will likely have the spare time to go shopping for investment properties. So they can diploy several people from the team to go have a look at the property and see if it meets to their expectations. This is also where other people's knowledge come into play. You may not know the location where you wish to buy your investment property really well, but somebody else on your team might. You may think that the area looks good but your team member may disagree because he or she recognizes something that you don't.

This is how excellent property investors are able to amass a sizeable pool of investment properties in a short period of time.

Come to the Property Outlook Conference organized by Wealth Mastery Academy to hear what experts in the industry have to say about the property market. They will also share their property investment strategies. Like the POC Facebook fan page for the latest updates regarding the events. For the latest news on our other upcoming events, like the WMA Facebook fan page.