Property Investments and Tenant Management

I finished reading Your Tenants, Your Jewels by Renesial Leong yesterday. The book belongs to Sara who bought it at Wealth Summit. According to the book, only 1% of the population in any country is actively practicing property investments. Why?

Today I found out some of the reasons from a personal experience.
Many people feel that property investment is a big hassle.  Not only you have to come up with the cash for the deposit.  After you finally get the property, you may have to repair it, renovate it or furnish it.
Then you have to look for a tenant or a few tenants.  For example if you are renting your apartment to students, you will have to look for a few student tenants. You have to deal with their parents.  They might call you for every little problem that arises.
So, in summary, there are a lot of people who do not know about the rewards of property investments, and based on their own narrow views, they just push the whole idea aside.  They said things like they would rather invest the money in business than worry about petty things like that.
And so, there remains only 1% of the population who would go through all these trouble (and in fact, we enjoy doing it!) and become property investors.
Yes we enjoy it.  Property selection, furnishings selection, cleaning up and seeing the beautiful end result.  Tenant selection and management.  Money in the bank passively every month.  For all the benefits of property investments, there are just very few people who know the true beauty of it.  And then there are the people who do not know, but keep "pouring cold water" onto other people who may be interested to start.
My advice to all property investment beginners: don't listen to the negative people.  Check and see how many properties they have.  It is no wonder that they have none (aside from their own house).  Check with the people who do have the properties, and learn and listen to them.

Tycoon with a Cause Part 2, Dec 2010

My friend, Sara, attended part 2 of the Tycoon with a Cause organized by Freemen in Dec, because we agreed we would partner up and take turns to attend.  In that seminar, Michael himself is the speaker who shared his experience in property investments.  Besides the good learnings from Michael, networking with like-minded participants is also invaluable.
However there were some participants whom were not willing to share their experience.  Yes, I respect that there are some personal areas or secrets that one would not disclose to complete strangers.  In such instances, it is better to just give the short answers or mention that you are uncomfortable to disclose the details, but give a general overview; then the other party should get the message.  Yet, there were also some other people who believe in the law of limitations.  When Sara asked another participant regarding her experience in properties, i.e which area and what type of properties, the answer was: "Haha, cannot tell you la.  Afterwards you become my competitor."
Even Peter Yee, the expert in auction properties, conducts classes on how to win auctions. Was he worried that he would create more competitors in auction sessions?
He said, "I cannot buy all the auction properties. There are plenty to go around."  Learning from the millionaire Peter Yee, Sara and I believe in the law of abundance.  A candle does not become dimmer if you use it to light another candle.  There are plenty of properties to go around, you cannot buy them all ;-)

Tenancy Agreement Contract Breached - Can we cancel the stamping?

After my last tenant broke the contract and defaulted on his room deposit, I was worried about the income tax reporting.  That's because I have already stamped the tenancy agreement at LHDN, and I was afraid that  LHDN will use it to trace the rental income. I searched for answers on the web on how to cancel the agreement.

I found websites which explained that rental income tax depends on our tax filing, not on the tenancy agreement stamping. So the tenancy agreement is breached and the rental is terminated, I should just report the income as what it really is, no need to cancel the agreement at LHDN.

Do you have any experience with this and would you have any advice for me?

SD Tiara - last tenant found

I am thankful that after the vacancy in November & December, the last room at SD Tiara is now taken up again come 1 Jan 2011.
The main problem was I was away for 2 weeks and didn't manage to show the unit to interested parties in time.  I also had many enquiries but not enough for viewing.  So far I had shown the unit to only 3 prospects. Thankfully today, I got a tenant who works at Bandar Utama which is about 5km away.  In fact, after viewing, he paid all the deposits on the spot to guarantee the room. So my unit is once again full-house.

SD Tiara looking for one last tenant again

Just an update here about my SD Tiara apartment.  By November I already had 3 tenants and no more empty rooms.  Then last week the last tenant who moved in about 3 weeks told me he had to break the contract and move out.  That was because his company who moved him to Kepong last month, suddenly moved him to work in Perak.

As he only paid the rental for November and also one month's deposit - he was supposed to pay 2.5 mths deposit and November rental but because he moved in mid month he asked for a little leeway to pay the balance by month end - he asked me how to settle the balance.  He actually owed me more than that, and the contract was already signed and stamped, but I felt pity on this guy who was suddenly moved again, and told him it was ok, I just forfeit that one month's deposit.  After all, I had no loss, except to find another tenant. He was very happy.  He told me that luckily the company was fair to him, they would let him claim the rental and deposit.

So now my apartment is looking for one last tenant. I believe if I am a fair and good landlord, eventually I will find my good last tenant.