Strata properties offer good returns, says Exastrata Solutions

SETIA ALAM (March 4): Stratified property is a good option for investment but investors should do their homework and be a responsible owner if they want to ensure investment returns, said Exastrata Solutions Sdn Bhd chief real estate consultant Adzman Shah Mohd Ariffin. (pictured)

There are more strata developments coming up nowadays due to the scarcity of land, he said during his talk at the two-day Malaysian Annual Real Estate Convention 2017 (MAREC'17) organised by the Malaysian Institute of Estate Agents.

There are about six million Malaysians staying in strata properties currently, Adzman Shah said, adding that such properties make attractive investments for rental returns.

He cited a news report published about six months ago, that a well-managed condominium is able to offer high yields of 5.5% to 6%, especially those in Mont' Kiara, while other areas in the Klang Valley can offer returns of up to 4%, compared with 2% to 3% from terraced houses and bungalows.

However, to ensure good returns from strata property investments, he said investors should avoid those with legal issues.

Adzman Shah advised investors to examine the legal aspects and avoid a property that has maintenance issues, and has no prospect of getting a strata title.

Many owners also do not understand their responsibilities as a strata owner -- they fail to monitor the performance of their property manager, and fail to comprehend the role of a property management committee.

"As an owner of the strata property, investors have to pay maintenance charges timely and monitor the property management to ensure the property is well maintained as a well-managed property will offer better returns," he noted.

Some investors also fail to recognise the unit with the best value in a strata building.

"For instance, investors should find out which unit offers the best value in a strata building. For example, the units situated on the higher floors are usually more expensive due to the better view, but if the units on the lower floors have a cheaper price and are able to get the same view, investors should go for the lower unit," Adzman Shah explained.

TheEdgeProperty.com is MAREC’17's media partner.