If you have a child and consider sending them to good schools, why not consider Epic Residence? Located within a 15km radius of five schools (Sunway, Taylor’s International College, Lim Kok Wing and so on) the development is also within a 5-minute drive to the IOI Mall and Puchong Perdana LRT station.
By Lucky Ducky
Hello fellow Puchongites! Yes, I am back for another blog posting. Although my school days are way over, I want to stress the importance of purchasing a property near to good schools like in Epic Residence.
Let me tell you this – no investment is entirely foolproof. However, if there is one product that comes close, it is residential properties located nearby universities and colleges.
Let’s look at the US example. An analysis that I did showed that demand for housing from students and faculty staff has kept university townhomes’ prices stable during the housing market downturn that began in 2005.
Additionally, according to Prof. Max Shangkar, founder of Max Capital Management and global property investment expert, student accommodations nearby reputable universities in Malaysia can generate a return of investment (ROI) of at least 6 to 8 per cent. This is significantly higher than the 3 to 4 per cent yield generated by other residential products in the market.
Here’s five important facts I have discovered about properties near to good schools
#1 Student rentals are moving in one direction only: UP
This is no one-liner statement. Yours truly did some investigating of my own and the resulting numbers seem to align with Prof. Shangkar’s claim.
My sister, Kitty, who is attending Taylor’s Lakeside University in Subang Jaya is paying RM850 for a 99 sq ft room located in a student hostel nearby. That is a whopping RM8.60 per sq ft!
In comparison, my friend is paying RM800 for a 171 sq ft room in a ‘hotspot’ condominium. Located just next to an LRT station, opposite a KPJ Hospital and a mere 10-minute drive away from KL Sentral, this translates to a cost per sq ft of RM4.70. This is 45 per cent lower than Kitty’s. As you can see, the rental yield is way higher for a property near to good schools.
The craziest part is her living space is almost half of my friend’s. Nevertheless, the demand for units at Kitty’s place is over the roof – there is a long waiting list as parents clamour to secure a unit for their own kids.
It is pretty much similar for other students hostels within the Klang Valley. Rentals are not cheap but the demand is robust as parents are willing to fork out the money for the sake of their child’s future and comfort.
This proves the point that even when times are tough, the tertiary education business continues to fire on all cylinders. This trend will remain unchanged as long as Malaysians continue to have children.
Investors take note: with the economic slowdown and depreciating Ringgit, you no longer have to scratch your head over which product is best for hedging your money against inflation.
#2 Buying Trumps Renting
Using Kitty as an example and assuming rates remain the same, my parents will be paying rent amounting to RM30,600 (RM850 X 12 months X 3 years course). This lump sum is sufficient for the 10% downpayment for a RM300,000 property (Read: ASSET)
Speaking of which, Epic Residence is now offering a Stay to Own scheme that makes home ownership a lot more attainable. To find out more, you can email them at firstname.lastname@example.org
What are the other long-term gains, you might ask? Read on:
#3 Child’s Security
Upon graduation, your child will have his/her own place to stay, thus eliminating the need to rent once they join the working world. The savings can instead be channeled into other investment vehicles such as mutual funds, unit trusts or stocks. This might just help bring down Malaysia’s high household debt percentage!
#4 It Is A Moneymaker
Unless you purchase a studio unit, the remaining rooms in the property could be rented out to other students and voila, you will be receiving a steady flow of passive income each month! An added win? This money can be used to cover your child’s living expenses and tuition fees. Also, should you decide to sell off the property, you will gain considerable profits as the steady demand will ensure that said unit enjoys fantastic capital appreciation.
#5 Comfort & Safety
Student hostels can get rowdy and is at risk of being a den for nefarious activities. Parents can seek out one of the many condominiums and apartments with fantastic facilities and state-of-the-art security like Epic Residence. Here, you will have a peace of mind knowing that your child goes to sleep each night in a safe and sound environment via the newly launched Bukit Puchong Community App.
Keep in mind that due diligence is still necessary. Important factors include ease of commute and surrounding amenities. Most importantly, you should do a research on the developer’s background to ensure you are purchasing a quality product.
In the meantime, do excuse me while I go speak to my parents on how they can save tonnes of money – my younger brother will be enrolling in Sunway University soon!