What Factors affecting Rental Property Income Depreciation and Appreciation

Dr. Peter Yee, one of the most famous Malaysia Property Guru was sharing on the factors affecting rental property income in a free property investment seminar at KLCC recently. What is your consideration before make decision to buy a property purpose to make money from rental income? How do you define your own rental property hotspot? Is it property nearby college and university targeting to rent out for students? Or property nearby multinational company offices targeting to rent out for expatriate?
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Factors Affecting Rental Property Income

(notes taken from Dr Peter Yee’s property investment seminar)

  • Ready Built
  • Population Growth
  • Income Growth Area
  • Rural Urban Migration
  • Foreign Migration Expatriation

The points stated on above sound like normal understood general knowledge for everyone. In fact, it’s useful to use as rental property guidelines to decide which property is the best for you to invest your money in. Different investor different strategy. It’s all about how you implement the ideas into your own investment plan.

Below are the examples how I adopt Dr. Peter Yee’s point of view into my own rental property investment strategy for property nearby college / university to make money from rental paid by students:

  • Ready built: Depending the college / university is operating or still under construction? Ready built property shall be preferred if the education center is operating and demands are there. New launch project probably can be considered to get cheaper property while waiting for completion of the college / university.
  • Population Growth: Study on the student’s population growth since past few years and maximum students can be adopted into it. It’s important to estimate the supply and demand factors which will affect the property rental market.
  • Income Growth Area: Study income background of the students. Different incomes of family background decide the living quality expectation on your rental property.
  • Rural Urban Migration: Study origin of the students. They are majority from high or low income family background? Low income family’s student may not mind to share a house with many housemates for cheapest rental accommodation. In the situation, you should consider to renovate your property into more bedrooms to maximize the rental income. But, the same idea might not work for those students who expect for better quality living standard.
  • Foreign Migration Expatriation: Local student or foreign student. It determines your rental property investment strategy. Different needs and wants between local and foreign student.

Another good point I have learned from Dr Peter Yee was the ‘town growth direction’. It is growing 1KM per year (I could not find any data yet to support the statement. But, no doubt, our town especially KL, PJ and others major towns are growing outwards rapidly). Anyway, the information is useful for property investors to have better idea where to buy now and future based on the estimated development growth direction and timing.

2 thoughts on “What Factors affecting Rental Property Income Depreciation and Appreciation”

  1. JaneJaneCat

    It’s a great blog site..
    Thanks Lim, for sharing so much valueable info with us..:)