Pic small

Do you happened to have any preferences on Freehold vs Leased Hold property be it residential / commercial property? 

E.g. if the Property is located in in a prime area in Bkt Bintang but it is a LH property would you be investing in it (if you have the $$$$ on hand)


P  2c3e50 small

In a way, for leasehold property, you are like paying rental up front to the state. I will prefer freehold properties.

Pic small

many prime area nowadays are LH properties ... 

Pic small

For instance majority of area in Sri Petaling is of leased hold property 

P  2c3e50 small

Go and look for "future prime areas" which is still freehold...

Work small

Doesnt really matter for me. Not going to stay whole life too. Previous generation mostly yes. But this generation a lot buyers doesnt mind it.

Pic small

Some bank are very particular about leased hold property that is below 50 years of leased. 

Work small

That is some 50 years of leased but not much in the market. Buyers still have many choice to choose those above 50 to 90 years. 

A  c0392b small

wont even touch lease-hold, because the terms to sell the property would be so difficult. Just imagine any condo 30 years down the road, it will look horrible, and on top of that, lease left 55 years on the paper. Any sane person looking at such conditions would not even buy , with the banks looking into giving out loan, they will be hesitant as well.

Work small

Condo with 30 years down the road basically not many will interested to buy even its lease or freehold...LOL....As property lease left 55 years is not many on the market compare the rest of the properties. As i know Kota Damansara and Tropicana no problem to sale all kind of segment properties as the entire area is leasehold. Even PJ sec14 too not really a problem for sale. So does kepong too i remember 2 years ago an old fashion condo left i think 65-69 years around still a lot inquiries and no  problem for sale as its sold at market and bank value price. 

Maybe i'm lucky, This few years the buyers majorities are choose properties base on Price, Location, design, ....Sometime will fengshui and number, not many choose base on free or leasehold.

A  c0392b small

Meaning,  if want to buy property to stay, and be able to sell it out at an old age.. dont buy leasehold. because will invite trouble later, with difficulties selling the condo. Just look at any luxury condo build 10-20 years ago, and look at its condition... They can blame anything, for its condition.. but mind you, any condo bought will have same chances to become those in the future,

Work small

Still same. Those 10-20 years and condition bad as you said. even if is freehold also buyers wont interested much. Its a condition issue not a freehold leasehold issue.

As for own stay. As i know many (not all) of this generation is stay 5-10 years around then will change another property. Ofcoz if landed then will be longer. No issue selling those leasehold properties. If is a issue then will be other issue like design, facing..fengshui...etc but not becoz of leasehold. 

That is a Riana green condo at tropicana 10 years around few years back. few inquiries and buyer paid on the spot sign the booking immediately to grab the unit to stop other buyers for viewing.

A  c0392b small

Lol, lets say Riana Green Wangsa Maju, (high end residence) i had a look and was scouting at the property there.. some of the condo is actually in a sad condition..the balcony view was already blocked with another office  building in front.. and those units.. nobody is staying in them..the property agents are disposing old furnitures in them. They were trying to sell that unit..the layout was quite nice, but the size of the condo was quite disappointing, on top of that it is lease hold.. i think the moment people see the view, and know its lease hold, its a huge turnoff... although the location is good, it was still empty. If i were holding a unit like that, for 10 years, the longer i hold, the lease years drop..i feel like i think i would be losing money. Because money and value is linked to the term or number of years left.  

Work small

haha....Even if that Riana green you mention is freehold but if bad view facing and bad condition. I dont think buyer will interested it too. So its really not the leasehold freehold issue. You will losing money the same way if you buy a freehold with such bad condition property.

A leasehold unit with golf clear view, fresh air,  normal layout, good location, even you hold for 20 years and will earn money too. The value its not linked to the term or number of the years left. 

So basically the value and money is base on the surrounding and condition more then the years issue.

P  2c3e50 small

u have to compare apple with apple. assuming ceteris paribus, one property is leasehold and the other is freehold - definitely freehold one is better...

A  c0392b small

lol, like this la, any property leasedhold for me the value is linked to the term of  lease left. After 30 years, most property would not retain its luster and shine, no matter how high end it is. Hence exaggerating its reduction in appeal to buy one. 

Screen shot 2016 01 21 at 8.27.17 pm small

I personally do not mind LH or FH, it wont be a prime consideration when it comes to purchasing my property, location and accessibility comes first. But of course generally people prefer FH properties.

Work small

(This post was removed by author)

Work small

lol...After 30 years with those bad surrounding and bad condition even its freehold i dont think you will interested to buy too.

So if both condo as bad condition like riana green wangsamaju as you said,no matter leasehold and freehold after 30 years also no buyers interested to buy then mean no market.

For this generation of people rarely buyers will hold a property so long. Yes buyers mentally prefer freehold but majorities not a must. If like the design, location, surrounding, and price all ok. Then will buy it. If that is a freehold then take it as a bonus.

Your point is leasehold hard to sale after 30 years time. But actually same goes to freehold as well. When no body buy your 30 years old freehold property then how???

and assuming ceteris paribus, ofcoz its freehold a better a bit even transaction also 2 months faster then leasehold. No one said freehold worst then leasehold here. Just as i said earlier, majority of buyers consider the surrounding and condition of the property more then the LH/FH issue. If that is a freehold then its bonus.

A  c0392b small

Freehold would be easier to sell after 30 years, compared to leasehold. It will of course be a bonus.

Reason why this generation rarely hold property for long? Its because they are "investing" i think, or "flipping"..ect ect They are not buying to stay.. But for people buying a place to stay and i think have a fmily, its better to buy freehold for long term. 

In 30 years time, if nobody buys my property, i rather have it in freehold then leasehold.

Work small

If you planning to stay forever like last generation people, then ofcoz will be freehold.

Some buyers ask for look only certain facing direct, some are only certain postcode, some are only freehold title. Yes market do have this kind of buyers but not the majority. So If a property unit condition and surrounding is not bad. Its wont make it hard to sale even its leasehold. 

And this generation rarely hold for so long (after 10 years). its becoz their life cycle change. Not just investing. After 30 years if you no move...then no matter is free or lease hold also you mostly will continue stay. And no difference for it anymore as how many will live till 99 years now a day. LOL....

A  c0392b small

Lol,  even in this generation, I dont work in KL all the time. I work all over the place. But , I wont buy a new place everywhere i work. I stay in Malaysia probably 3 months a year.  But we always need a place to keep our stuff, for long. The point i was making is, most people will keep a property at least 10 years, unless the jump jobs every 1 year. hahaha..(job hopping) After 10 years, if he decide to move, or jump jobs, it is easier to sell a free hold then a lease hold. If he bought a 2nd hand leasehold property with xxx numbers of years left, he will find it hard pressed to sell his house. Even freehold properties now have trouble finding buyer, what about leasehold properties? or second hand lease hold properties? We wont live 99 years, but hell yea he would like to sell off that property easily when the time comes, or... if there is a downturn like now.. he lose his job, a freehold property would easier to dispose of.
The regulations around leasehold property is just too much. Only leasehold i would consider would be a commercial property, but not a residential property. LOL.

A  c0392b small

Anyway, another point to make was..';how long does a child need schooling for?  Hence if someone buys a place to actually stay, with their family.. they stay for long.. minimum 12 years for compulsory education. unless they want to burden their children with changing schools ect want them to also inherit a property which can build up/retain value for years to come. 
In neighboring countries, foreigners are only allowed to buy leasehold only as well, why should a citizen of Malaysia buy a leasehold in their own country?

Work small

ya...many of them its around 5 to 10 years they change once. Even with or without changing job.Lets talk about after 10 years they want to sale. Example i given earlier is riana green in tropicana and also kepong (medan putra the old one). Leasehold 10 years around and no difficulty to sale as long as with bank value can get. Owner wanna sale it coz life cycle or life status change. Same goes to that buyers who came to buy. Some are changing job but some still work the same job. Normally i do ask them where they stay and why want to move here and anywhere else they looking when chit chatting with them. Some want to stay around that area only, Some regret to bought somewhere and now want move back after 3-5 years, some upgrade, some downgrade etc...many difference reasons. your points is the Leasehold property hard to sale is not true at all. becoz that is not the main issue buyers concern of. Is an issue ya but not the big huge issue. As i said, some buyers will only look for certain facing direction properties (dont care lease or freehold), Some only want certain postcode, some certain number, and some are like you only want freehold. Its personal preference. But Majority of buyer not. So if majority of buyers dont mind about leasehold then it wont be hard or difficult to sale. 

Work small

For the children, i really saw some they only change house but still remind same school. Primary 6 years, secondary 6 years some really just travel very early in the morning. But some really shift school. About  inherit, this few years what i saw is parents buy new house for their kids when come to study or kids after work few years. For those originally thinking inherit to their kids all change plan and put on sale. And ofocz both leasehold and freehold not difficult to sale too as long as price ok and condition and surrounding ok. 

 why should a citizen of Malaysia buy a leasehold in their own country?   Easy answer, price reasonable with condition and surrounding acceptable buy that particular buyer at that area. 

Downturn like now its similar too. If buyers not enough money or cant get enough bank loan, both free or leasehold also he wont buy. If the area or property he choose is a leasehold and he able to get enough bank loan then he will buy. Wont purposely force himself from area A goto buy area B. 

Just like you prefer Freehold, I'm not forcing you to like leasehold, similar to some buyers must choose facing South, i wont forcing them to go buy property facing East. But that does not mean facing east hard to sale. LOL.....

A  c0392b small

Your point is from the buyers, what people like, different buyers have different preference, you are right, if you are looking from an agent perspective,.... but in terms of value preservation , risk profiling and time degradation for condo properties,  for a property buyer i think leasehold will never hold value. 

The question is perferences: dealing from a agent, there is too many reasons. But my preferences is: on why would I want to buy a CONDO on a leasehold land?

1) I don't own the land, and i would be paying for a property which is not located on a land i own. The government have the first right of refusal to renew the lease. If all condo owners does not want to renew the lease,  logically the government would get the land back. There are 300 owners on one condo, and if only one owner do not renew the lease then the land lease is not renew. I would not want my future generations to inherit a liability. Agents will say no problem, government will sure renew. But think of it this way, have you seen any condo's lease being renewed? Is there any law for this? Condo owners have first right of refusal? most condos were built within 30-40 years back. And not even one have finished its 100 years lease. What make you think that in the future that the condo would not be in shitty condition and the government take back the land for other development? It's a really shitty thing to leave your future generation. Claims that most agents say the government will renew leases have no weight as non had been done yet. Just ask any one , do you know any condos which finished its 100 years lease and have been renewed?

2) In a down turn, if people don't have enough money they would not buy any property, you are right. But if people have money, and there a some buyers, and many sellers (due to down turn) which property do you think they will buy? Of course given the chance, of course they will buy freehold!  I like A and B, both property similar, nearby location, quality is similar, price similar but  A is freehold, B is leasehold... Duh.. what an easy choice. 

3)Your view is that due to most buyers circumstances changes, after 10 years they will want to upgrade and change place to leave or so. You are right. I would want to do the same. But in that time, if i want to sell, after 20 years, a freehold would have an edge over a leasehold anytime. The restriction on leasehold properties, and such, a freehold is not only is difficult to sell. I am talking as a owner. I want to sell my property. In such economic conditions, even freehold in good location is finding difficulties to sell. What more leasehold. So many properties/choices out there now,. Withing a 10 km square ,,i am pretty sure you can find similar quality, location  and both freehold and leasehold property, because KL is so dense. If there is a choice , they will choose freehold over leasehold. 

4)Why should a Malaysian Citizen buy leasehold? Duh.. overseas investors cannot buy freehold properties in most countries around SEA. Only in Malaysia they can. (thanks to our government policy of selling land to foreigners) Do you really want to buy a "restricted" property at high prices? That's why foreigners want to buy freehold. Because it is un-restricted. If you have the choice why would you want to buy a restricted property? my personal thoughts are.. people only buy leasehold because they have no choice..! Not because price is right. Its so sad for them. Actually i pity them, The government dictate where  they live, the toll they have to pay and the prices they have to pay. 

5)Leasehold for me is like renting a piece of land. But if i want buy, i want to OWN it. That's the concept of buying. I would OWN it. I am not leasing it. That's why its called leasehold. And when you are leasing a property, make sure you are doing a business on it because you are actually renting. Thats why the only leasehold properties should only be commercial property.

6) As a buyer, I am always looking at preservation of  value of my properties. On a different view, some people would look at the reasons why people are moving, and try to convince most people that they would not stay for long for a reason. (agents).  Do you think at this point, when everything else is crashing, and  the banks are the last line of defence.. in this economy..a leasehold property is what you want to invest in? The banks doesnt care as long as you owe them money. If they cant sell the property out at a price, you will still owe them the money minus the sale value. The laws favours the banks. Hence its in the buyers interest to buy any property that can retain/preserve value. Freehold is the only way to go. 

7) My thoughts are, leasehold properties, are lands which are leased from the government at a cheap price and expensive developments are built and sold from it. Its really shitty to buy a property on rented land, unless i can move the house once the land leased finished,


Work small

My point for buyers preference is base on the case i met before. The feedback from most of the buyers. And value is one of the type of preference. 

1. You asking a future question which is nobody can answer. Which property already finished the lease? or still have 10 years lease? And how you know after 50 years that is a owner among whole block does not want to renew the lease?  And its is not fair to targeting agent to said no problem to renew. its sound like agent wanna cheat buyer to buy. Dont said 100 years, even 50 years later what govt and policy also nobody will sure. So if you unlucky to met those kind of agent you can ignore him/her and go for other agent. For my answer future thing nobody sure, Now is 10 years old and you stay for another 10-15 years by that time really nobody sure. And if   in the future that the condo in shitty condition even a freehold also i dont think will have buyer come to buy. Imagine you go and buy and the owner said : " i stay here 50 years no problem at all everything fine, its freehold and value no problem, i planning to inherit to 10 generation long but my kids dont like, they move out for their own world, i feel boring and want to go their place to stay (or too big for me want to move to small unit easy to clean) and now i selling cheaper 10k from bank value to you" Then you look left and right that is many unit already move out or vacant due to shitty condition and whatever reason, would you still buy it even its freehold? dont think so right? That is call have value but no market ...equal to zero if cant sale off.

2. Your are  assuming ceteris paribus. I did answer before if everything same then ofcoz freehold will get. As a bonus. Luckily we are dealing with human, have difference preference and wont make it hard to sale even is leasehold. :D

3. Yes "if " that is a choice and also if ceteris paribus. Dont ask me why but people sometime or most of the time "Choose"  to make their self limited choice due to whatever reason. LOL....But as long as they choose want to buy, whatever type of property. then we agent have business. Except those direct deal with owner.

4.  Foreigners will buy freehold does not mean Leasehold hard to sale too. As previous said that is still a lot buyers want to buy leasehold condo too. I'm not saying freehold hard to sale, im saying leasehold is not hard to sale too.

5. LOL...and this is what i called, personal preference. You have your own reason to like it,  Just like some buyer they prefer KL address over PJ address and surely they have their own reason too. And technique you still not OWN the land. Its 999 years. (correct me if i'm wrong info for this). and also The government can still take back freehold land under the Land Acquisition Act 1960, to be developed for public purposes [such as an MRT project] or economic development. The term ‘economic development’ is a grey area and the government has the discretion to take over any private property [at any time],” P/S: even if take back then govt should pay back market value to owner but we both know current govt if really owner can get back full amount then is consider lucky. LOL 

6.  You are right to looking preservation of value of your properties. And again, you sound like agent are trying to convince (cheat base on not the correct fact) buyer to buy. Even in your point number 3 you just saying you will do the same (moving). Agent will provide what info/data they see and know to buyers. Final decision still make by buyers their own. Its a reference, only buyer will know their own status batter then anyone else and make their own decision. Example a buyer stay 10 years property facing South and everything smooth and good in life everything. Now he want to upgrade and wanna find back facing SOuth. I might suggest him facing South but little few degree toward to SE, and the owner wanna sale also becoz good and wanna upgrade (owner told me). Then this buyer can consider take this unit and also can reject and continue look for Exact facing SOuth's unit. 

7. Ofcoz this is your preference of thought. i respect everyone thought and that is no right or wrong exactly too. Just for the customer i met this few years. Maybe i'm lucky, majorities are base on other factors like design, price, surrounding and condition etc...There do some buyers share a same thought like you too. For me, customer want freehold i give them freehold, want facing south i give them south, as long as meet their preference requirement with an agreeable price ofcoz. i have seen leasehold properties easy to sale, also i have seen some freehold properties hard to sale. So for my personal thought. the lease title not about all base on the feedback from various customer. We agents also dont want to do hard job, if leasehold very hard to sale then all agents gone for only sale freehold properties already. :p


A  c0392b small

Points by points:

1. The fact is, if no one can gives an answer, then no one should give a guarantee. Some seller like to give a guarantee on "no issue" on renewing lease when they don’t know the answer. Anyway nobody will know the future risk or governemnt policy. But my say is, the probablility that one owner does not agree to pay premium to renew lease is more higher than everyone agree at the same time to pay the renewal on the lease. In so many condos, just imagine about 30-60% does not pay the maintenance fees on time, or not at all. What makes one think the probablity that 100% will pay for renewal of the lease. The probablity that 1 person do not pay is higher. That is exactly why leasehold is more risky. The land can only be renewed with everyone paying their dues. This is human behaviour(as in point 2). 10 generations (too long, 3 generations is better for the time line of 99 years) down the road, the grand children owner of this leasehold building would lose their house because 1 idiot does not want to pay and sign for the renewal, regardless condition of the condo. Hence freehold is still better.

2)We agreed that if we compare apple to apple, with the only difference being free hold and lease hold, freehold is a bonus. I am not selling, hence I don’t care what other people like. Human have different preferences but , that does not justify the point it is easier to sell a leasehold or a leasehold is more attractive then a freehold. It only means there is still market for it. But it does not make a leasehold more attractive compared to a freehold. (if we compare apple to apple, as you say cateris paribus)

3. So would you agree that if there is a choice people will choose freehold over leasehold, as you pointed out? with "apple to apple comparison, cateris paribus" . But some people with self limited choice choose to buy leasehold with whatever reason. It is because I belive that they have no choice by funds or whatsoever. Not limited choice. There are alot of choices and there will be a market for all type of property depending on people but limited. Still, in an area where freehold and leasehold properties are close to each other, freehold is still better. Drive 5 km any direction from a leasehold property, you will find a freehold property. Hence i still think for market wise it is still better to buy freehold.

4.I am not saying that if most foreigners can buy freehold it is difficult to sell leasehold. What would I, as a Malaysian Citizen want to buy any property with restriction, when I can buy property without any restriction? When any foreigners can buy an un-restricted properties by land lease, I would not buy a property with restriction on land lease, when i have the right to buy freehold. If we just compare two leasehold property, for what ever reasons, and the buyer want to buy a leasehold, might as well he buy a leasehold property next to the seaside in Thailand, Bali or Phillipine since i am a foreigner which is entitled to buy lease property there . Beautiful sand, sea and beaches. Instead of an ugly condo in a jam prone area, or buy a landed leasehold.

5.All land in penisular is only 99 years lease. I think in singapore can get 999 years lease some places. Sabah Sarawak might get 999 years lease, in rare cases. But if its freehold, you OWN the land. But in terms of owning, the reason also comes back to selling. There would be more restrictive financing available for older leasehold properties and this could affect their resale potential. If its freehold and I own it no problem. The only reason i can think of if people buy lease hold condos, shops or whatever, is for the rental yield. If they can make a profit off it, then they will buy. If not, and its for their own stay, use and family, they would buy freehold for easiness of transfering ownership to children. Nowdays rental yield have dropped, and its more costly to maintain a property. Hence i still think freehold is better. Government can still take your land, it can be an issue. But they would not dare to force evict 300 families from a condo. Condo land is too small to take any pieces of it. But they can still build a LRT over the land. I have a relative whose land is taken "part" of it to build highway. But they would not take the whole lot, they would just take what is needed.

6. So it is agreed that freehold preserve more value compare to leasehold. Not all agents are as honest as you are I suppose. ( I dint know you are an agent, my apologies) Back to the case of human behaviour. In my line of work, I am very particular about data/info people feed me. They only feed you data they want, which they think should lead to a sale. So I dont normally listen to agents/sales. Final decision can be a false decision if you are fed the wrong/insufficient data. Best example is property adverts now. I find most property advert online is misleading/dodgy and reason being no regulations on that. Hence to be safe and to minimise risk, any small reason that can reduce value i would not buy that property. And one reason being a leasehold property. Government should introduce regulations and laws to advertisement of properties akin to that of Hong Kong.

7.Meaning I m a picky person. What you meant is : as the Malay used to say, "tepuk dada tanya selera" . There is still a market for lease hold properties based on appetite. But what I m saying is, to preserve value, buy freehold or buy gold.. What goes up will definitely come down. And history will remind us this fact, again and again. 

Work small

Yes,  We do agreed that if we compare apple to apple, with the only difference being free hold and lease hold, freehold is a bonu. But in real that is not much case like that for buyers to choose exactly  cateris paribus with only lease title difference. 

As my points always clear. The title of leasehold not the main issue for a leasehold property hard to sale. Same goes to freehold title not the main issue for a freehold property easy to sale too. The main issue still surrounding and condition with reasonable price within bank value. (for majority of buyers)  

Bandar utama (freehold) and tropicana / Kota Damansara (leasehold) are next to each other...Kepong, both leasehold and freehold mix up. No problem for selling both place leasehold properties. 

Your theory is 99 years can stay 3 generation. And freehold more then 3 gen. But in fact for the modern age of generation.  I dont see much still practices that way. Both freehold and leasehold assuming till 2nd gen 60years old property no matter its free or leasehold also not much buyers interested to buy. Like i said before even can get bank value and value still there but no market and end up no body (young gen leave, they might buy the same area) stay there which mean equal to zero. 

I never disagreed that freehold preserve more value compare to leasehold if you only want to ask purely this question. Hope you not misunderstand that i am " convince" to you that leasehold more value then freehold. And i also said is personal preference too and i respect people own preference.

Its ok no need to apologies, every field does have some bad and dishonest guys. Ask few more trusted agents for the info or asking here at the discussion forum i believed you will have your answer. Even myself if not the area i market then i will too ask agent friend or agents around there.

P/S : I am very agree that HK govt for the law of property. Buyers have a clear and no need worry about the law issue and benefit right.  

1380434 10201431210114979 1940676289 n small

gain lot from you guys *thumbs @yunsyn @Aack2001

Work small

I'm gain lot from @Aack2001 too.

Screen shot 2016 01 21 at 8.27.17 pm small

Wow, informative! Could actually make an article out of this discussion thread lol.

Pic small

likewise I learned a lot from everybody that contributed too :)