This article is translated from our Chinese article here.

Someone asked me this question during one of my courses:-

“Teacher, you have been asking us to take up mortgages from the bank to buy properties, but now there are still a lot of properties that are unsold. Are you sure that property investment still a viable option?”

Every time I open the floor for Q&A session, some strange questions will be thrown at me. Doesn’t matter – I will still see through it!

I looked up and saw the person asking the question. He is a young man in his 30s. He looks angry enough like he wants to eat me alive.

“What makes you say that?” I asked.

He said: “Malaysia’s property market has been in oversupply. Even the government says that there are many properties that cannot be sold. If we apply the economic principle, the price of real estate will not rise anymore in the next decade, or it will definitely fall.”

I smiled and asked, “What is your name? How old are you this year?”

“My name is Marcus. I am 30 years old.”

“Marcus, the Malaysia that you are seeing now is what Singapore was 10 years ago. The Singapore you are seeing now is what Hong Kong was ten years ago. The Hong Kong you are seeing now, is what Japan was 10 years ago. Do you agree with this?”

Marcus nodded.

“That’s good. Now you tell me why is the cost of living in these countries so high?”

More and more properties are being built, but will their pricing ever comes down?

“Because of…… inflation”

“That’s right! Can we be excluded from inflation?”

Marcus shook his head. “Then do you hate inflation?”

Marcus begin to cool down little, he nodded with a faint hint of a smile.

“Yes, no one in this room will like inflation, because it drives prices up. But inflation must happen, no country can be spared. This is the people’s review of the government’s KPI, no inflation means the economy is not good. If the economy is not good, people’s lives will be very difficult, because the surrounding countries have surpassed you.

  • That’s why we see Singapore becoming a “tax haven.”
  • In Korea, they popularise K-pop.
  • In Hong Kong and Japan, they modernize their film industry and sell more of their dramas.

Why did they do so?

Because they want to make their own country famous. Let the beauty of their country be known to more people, let people envy and yearn to come to their country.

Singapore property prices are high and fertility is low; in order to attract more foreigners to Singapore to maintain GDP and property prices, the Singapore government cut taxes to attract foreign talent.

These countries have one thing in common, their real estate prices are already very high, but the fertility rate is very low. This is inevitable. Inflation drive prices up, and when people are unable to raise more children, so they naturally have lesser children.

In other words, they build more houses, yet fewer people have the ability to buy them. So, is the property market going into a slump?

No. They turned their attention to tourism.

As long as more and more people go to their country to travel, study or do business, the demand for housing will always be there. Both long-term and short-term industries can be used to pull the property market back up again.

Property prices in tourist areas are generally difficult to fall to the bottom unless the tourist area has lost its attraction.

“Oversupply is only a temporary condition. Malaysia’s property market is still very competitive throughout Southeast Asia. Although the future is hard to predict, this kind of forecast tells us that Malaysia’s property market holds great potential.”

You have to have confidence in this situation. If you are always optimistic, good things will be easy to come by you. Of course, it is necessary to continuously improve yourself, or you will be irrelevant soon.

If you want to learn more about property entrepreneurship from Dato’ Sri Adrian Wee, please click on the link below and register yourself for our FREE 3 hours preview class:

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