Money Diaries

Mixed-up money: When taking risks in property pays-off

Mixed-up money is a series of friends’ financial questions. I am not a CFP by training so I do not recommend an investment, do not sell products, and are not affiliated with any of the financial tools providers. The names have been changed for anonymity.

There are so many negative notions about property in Malaysia these days. Taking a house loan is akin to singing the death penalty. The truth is, there are winners and losers in every game. If you are good, lucky, or good and lucky, a property is truly an asset that pays off. I like to share this story of a friend that actually did make her money pot from investing in property. Note: There was no 3rd party in these transactions, no property guru, no group buy companies.

Hilda is a government servant with a salary of around RM3,000. In 2012, while people are shouting about high property prices, she bought her first unit. And the second one in 2013. In 2014, while the housing market is boiling hot, she decided to leverage it further and did what most property investors would do, sent in three housing loan applications, using her existing rental income as proof of income. With 5 units at hand, all her rent is used to pay the loans and extras. That year, she basically lives like a refugee, with zero entertainment, surviving on bread and butter.

She then moves to the private sector which pays better and has a life. In 2017, she sold one of the units for double to ease cash flow. Then in 2018, sold another unit for gain that pays off another unit she owns. Now she has 3 property units of which 2 are fully paid off and all with at least 50% appreciation.

By using property loans as leverage, two years of sacrifice, and a lot of courage, she took only 5 years to build enough wealth for retirement.


Her method is not rocket science. She picks the property based on the segment of property she’s interested in. Say, if her target market is M40 in Klang Valley, the max price someone would pay is probably RM600,000. So she would look for a rentable place below the price e.g. RM300-400,000. That gives some rent and a higher chance of appreciation to RM600,000. You do not buy an RM600,000 unit, hoping to sell at RM900,000 to the M40 segment.

Looking back in 2013, I could have done the same with a similar payroll. But I didn’t (back then, people also talk about the property bubble) and I am not recommending you to buy a property today (some variables have changed). I merely like to share that, taking risks is part of moving forward in building wealth, and when you strike right, it pays off.

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