From Mr N, a viewer who wrote in by email
Mr N is 27, earns RM6,500 a month and expects about 20% a year in raises. Last year he bought a compact terrace house in SS19, Subang Jaya, for RM415,000, below the area's median of about RM450,000, spending RM50,000 on the down payment and fees and RM60,000 on renovation, including his EPF Account 2. He has about RM10,000 in cash and RM20,000 in shares left.
Will a non-gated terrace house keep rising in value, how can he buy a second property with little cash, and if a bulk-purchase group buys many units in one project, won't they all compete for the same tenants?
“Entry price determines the success of your investment for property.”
The house is a good buy, though open, non-gated terraces will rise more slowly as security matters more to buyers. With his cash used up, his next unit has to be bought on credit: a discounted unit whose rent covers the instalment, completing in a few years while he saves for the furnishing.
Why
Open terraces have a price ceiling
Easy access makes non-gated houses targets when crime rises, and their roads are public, so residents cannot seal them off. As prices approach RM1 million, which needs about RM15,000 a month in income, buyers expect security and facilities, so growth slows.
Unsold units come from ambitious pricing
Developers raise prices as a project sells, and the last 10% can stay unsold. They cannot cut prices openly without upsetting earlier buyers, so they sell the rest at a discount through investment clubs instead.
A lower entry price wins the rental race
In a project of hundreds of identical units, the owner who paid less has a smaller instalment and cash back to furnish properly, so a fully furnished unit beats a bare one at the same rent.
Cash back belongs to the property
Sean warns that cash back is not spending money for a car or a holiday. It should go into furnishing the unit or reducing the loan, or the rent will not perform.
What to do
- Add CCTV, alarms and better locks to a non-gated home.
- Agree with your spouse on how many properties you want and when, before buying more.
- Look for a discounted unit whose rent covers the instalment, due to complete in four to five years.
- Save for furnishing while it is being built; a three-bedroom fit-out can cost RM50,000 to RM60,000.
- Look for completed projects launched before COVID, which often have better materials than new launches.
Editorial Note: Summarised from Sean Tan's full episode. The quoted answer is in his own words; the rest is our paraphrase. Figures reflect the recording date, so check current rates and rules before acting on them.
ASKING SEAN #286 | WHY SO MANY UNSOLD UNIT?
Sources & Verification Data
Summarised from Sean's full English captions for Asking Sean #286. The quoted answer is verbatim; everything else is paraphrased. Figures are as stated in June 2025. Sean is a member of FAR Capital, the bulk-purchase club discussed in this episode, not its owner; his recent purchases came through it, and the episode links to it.
