How To Make Money With Crap That Other People Don’t Want

Abandoned home in Tambun

You know what, Khai Yin,” Calvin told me with a huge grin on his face. “The property market is just so gloomy these days. Transactions have dropped through the floor, new launches been pushed back or canceled. Rentals are taking a real beating, too. There’s no end to this plight in sight!”

“And yet you look like the fat cat who swallowed the canary.”

Calvin laughed. “Can’t help it. Do you remember the last time the market went to the dogs like this? 1998? Everybody’s scrambling out of the business but I stayed on my hustle and made a mint. And dude, it ain’t gonna be any different this time. Just see.”

Sidenote: if you’re not familiar with Calvin, he’s a childhood friend from Taiping who is now a the owner of a property development and investment boutique. He almost earned my wrath when he told me that he paid $150,000 to some business success Guru in Scotland for advice.

“Well, I guess any Tom, Dick and Harry can look like a genius during a bull market. Real players make money even the times are bad,” I said.

“Correction. Real players make money especially when the times are bad,” Calvin interjected. “The time is now ripe for me to enter the market… especially when there’s lots of desperate selling. Exciting times ahead!” he said, rubbing his hands with glee.

“This is a question begging to be asked,” I said. “So how do you intend to make money when others are losing their shirts?”

“Like what I did in 1998. By buying up crap that other people don’t want.

Why Abandoned Properties Are Undiscovered Gold Mines

As much as I get turned off by Calvin’s braggadocio, I still liked to hang out with him because he was the real deal: he made his way through life via unadulterated hustle, without the benefits of money, connections or even a college degree. He started off as an apprentice at a developer based in Taiping before he accumulated enough experience and money to start off on his own.

His first break was in 1998 when he used his initial capital to buy up abandoned properties in Taiping and flipping them when the market turned back up a couple of short years later. Indeed, he had made his money by buying up crap that other people didn’t want.

Whenever the property market turns for the worse, you can expect people to try to quickly dump their properties (especially if the properties were acquired beyond their means or through dubious schemes like DIBS). Houses that don’t get sold through the sub sale market either then get auctioned, or get abandoned.

One of these abandoned houses that he had acquired, refurbished and sold later was this pre-World War Two brick house in which he was born and grew up in. He bought it for $65,000 from his uncle (who had inherited it), pimped it up and then flipped it for $245,000 some years later.

“I remember that you even sold off your ancestral home in Pokok Assam. Your father must be freakin’ rolling in his grave like a rotisserie chicken.”

He laughed out loud. “Hey, at least I restored that house and stopped the termites from grazing it to the ground! And my deadbeat uncle had never been happier with the extra dough… though he probably gambled it all away over chor dai dee.”

I shrugged. “Cal, your shamelessness knows no bounds. But I’ve got it to give it to you. Making money from abandoned properties ain’t exactly a walk in the Lake Gardens.”

“Thank you for your backhanded compliment! But all jokes aside, Khai Yin, you know this as much as I do. Abandoned properties are like undiscovered gold mines. You need to scout around a lot, and I mean a lot, and when you find something worth digging further, then it’s time to start getting your hands dirty. However, once the legwork is done, then it’s just a matter of time before you unload the property for a nice profit.”

I nodded. “It’s not a sexy way to make money from property. And because the crapload of get-your-hands-dirty work required, there’s not a lot of people who will be scouting for the same abandoned properties as you do, which means that there’s also much less competition.”

“Exactly!” Calvin remarked. “And you really need to be on the ground to make this work. This means that whoever who wants to compete with me will have to be here physically. You can’t run this business remotely! Last year, some guy from KL came to town and tried to set up shop to compete with me. After a couple of months, I heard he had scooted back to KL. I suppose Bukit Larut didn’t cut it for him… he must had missed the Bangsar nightlife,” he said with a grin.

Here’s How You Can Make Money Buying Houses That Others Have Abandoned

It’s true that buying and selling abandoned properties requires local presence – which means that you’re pretty much limited to where you are currently living and working. However, there are abandoned properties in virtually every city or town, which means that you would hardly need to move to a town like Taiping. It’s pretty easy to spot abandoned properties – the clues are as obvious as overgrown lalang, or the overflowing of advertising flyers and bills in the postbox.

In the next couple of weeks, I (or rather, Shameless Calvin) will be sharing a more detailed strategy on how you can make money buying abandoned houses, refurbishing them and then selling for a profit. Stay tuned!

Why “Knowledge Is Power” Is A Stinking Cesspit Of Bull Manure

Suicide Girls at GoodPlaceHQ

A couple of years ago I had lunch with a very successful entrepreneur. Now retired, he was probably the most well known businessman in his niche during his heyday. When asked about his “secret” to success, he gave me a one-word reply:-


Ignorance…?” I had thought I had heard him wrong.

He smiled. “If I had known how difficult it was going to be, I wouldn’t even start. Knowledge is not power. Ignorance is.

I was quite taken aback by his answer.

He smiled. “You see, Khai Yin, knowledge is not the sole driver of success. In fact, it’s far less important than many other factors. In fact, elevating knowledge above everything else, ironically, itself is ignorant.”

At that moment, I knew that I was getting one of the most important lessons in my lifetime.

Since that encounter, I had made it a habit to ask every successful entrepreneur the secret of their success, and amazingly, “ignorance” would always be top, or near the top of the list.

In fact, a top Internet entrepreneur once quipped to me, “I’ve been an ignorant fool all this while. And without a doubt, that’s why I made it.”

Why Too Much Knowledge Will Destroy You

I will need to preface this article with this disclaimer: this is not a knock on the act of pursuing knowledge. As a matter of fact, I myself am perhaps the ultimate book junkie; at the mall, I’m happiest getting holed up at MPH or Borders for hours. And my ideal Sunday afternoon is one spent burying my face in books in our cozy little reading area at home.

Khai Yin @home


Over the years, I’ve come to understand (and appreciate) the difference between “utility knowledge” and “entertainment knowledge”. The fact is that many people buy books to be entertained under the pretense of “learning” something useful. The lies that we tell ourselves…

Reading naturally leads to thinking. Thinking, however, does not naturally lead to taking action. Indeed, as Richard Koch (this man’s a genius) has noted, thinking drives out action. Progress is all about taking action.

“The danger in knowing too much,” the aforementioned entrepreneur told me, “…is that with too much information, you may lose the inclination to act. Once you know a lot, you will develop an awareness of all the possible pitfalls even before you start, and this will destroy your will to act.”

“As you already know, chances of an entrepreneur making it is slim… maybe in the order of 1 in 1,000.” He then said something that I would remember for the rest of my life. “And to make it, you will have to believe that you’re that singularity… that one in the thousand, which means that you have got to be seriously delusional.”

Why Delusion Might Just Be Your Biggest Asset If You Want To Make Money

As an entrepreneur or an investor, I’m by no means “successful” by any measure, but looking back at what I’ve done so far, everything that worked could be traced back to a seed of inspiration and optimism that could only be sparked by, you guessed it, delusion.

For example, like almost every other lifestyle Internet entrepreneur out there, I started off by buying ebooks on how to make money online from the shit stain on the butt of the Innerwebz a.k.a. the “Warrior Forum” (that’s the name of the website, I kid you not). I was entirely delusional that a $27 ebook would make me $27,000 per month (as the Guru had promised), but I had to give it credit because while the information was entirely outdated, it had taught me the fundamentals of traffic generation – the lifeblood of all Internet businesses.

If I knew how difficult it would be (getting ranked on Google, for example, is not unlike crawling through five hundred yards of shit like what that guy did in Shawshank Redemption) I would have laughed it all off and resigned to live the life of a nine-to-five hamster happily ever after.

And so you know, thinking that GoodPlace will fix the highly dysfunctional property industry in Malaysia itself is a delusion of exceptionally epic proportion. Only time will tell if it eventually lives up to its promise, or wither away like the other 10,000 “change the world” wannabe startups you’ve never heard of.

Knowledge Is “Power”? Don’t Believe The Hype

The adage “knowledge is power” seems so obvious that usually we never question its validity. On the flip side, the idea that “ignorance is foolish” is also equally universal, and only serves the purpose of those who peddle “snake oil” wisdom – the Gurus. Indeed, mantras like “if you think education is expensive, try ignorance” are commonly found in the literature of property Gurus and other get-rich-quick peddlers.

So what does all these hold for you as a property investor? Pretty simple, really. Chances are that you already know enough to buy and sell property, and any further “acquisition of knowledge” will only impede your progress. Stop reading, and start doing!

How To Get Out Of The Wannabe / Watcher Trap

Rebecca Chan @GoodPlace

One piece of modern Guru truism that has caught on spectacularly has got to be Malcolm Gladwell’s 10,000 hour rule. For the uninitiated, here’s what the rule is in a nutshell:

Gladwell’s 10,000 Hour Rule: To be good at something, you gotta practice the crap out of it for at least 10,000 hours, give or take.

Here’s some math for perspective. If you want to be good at, say, playing the guitar, and if you can spare ten hours a day, five days a week, then according to Mr Gladwell, it’s gonna take you 200 weeks, or three-and-a-half years to master the instrument.

But what if you can only spare one hour every weekday to practice? Well, then you’re looking at a staggering 35 year time span for you to attain “world class” (Gladwell’s phrase) mastery of the instrument.

Of course, like any Guru truism that you hear these days, it’s best that you treat it with a healthy dose of skepticism. I don’t mean to call bullshit on Gladwell, but the 10,000 rule sounds empirical at best, and by nature it’s a hypothesis that can’t be verified in a rigorous or scientific manner by design.

At university, I had always marveled at how some of my college mates who would get totally wankered at the bar and still nailed their tutorials the morning after under the supervision of their sharp-eyed professors. I had always thought that they were blessed with genetically superior grey matter, and since I had very little of that, I had to do the 10,000-hour thing and regularly pull all-nighters just to play catch-up. It was no secret that I had struggled mightily in college.

And as the Mentor would quip, “There’s always shortcuts to everything. Everything. You don’t need to spend so much time and effort if you already know what mistakes NOT to make.” To him, the 10,000 rule is complete and utter hogwash. “Spend 10,000 hours doing something stupid, and you’ll still be stupid in the end.” He didn’t mince his words.

The 1,000,000 Rule

Calling oneself an “entrepreneur” seems to be quite fashionable these days. And for that exact reason I’ve been reluctant to call myself one. I’ve lost count of how many times I’ve met people who called themselves entrepreneurs only to find that they were in fact MLM peddlers / insurance agents / drug pushers / pimps / property Gurus / children of politicians or tycoons who didn’t need to work / etc.

I don’t know why but I’ve been getting regular calls and emails from ‘entrepreneurs’ who usually have requests along these lines:-

  • Can I take up your entire Monday morning and get your free advice on something?
  • Can I use your place for free for the next three months?
  • I’m too cheap, so can you please give my startup a free plug at your blog?

Now don’t get me wrong: I love my entrepreneur brethren, and I would do anything to help them within my power because I know that the whole entrepreneurship thing can be a real bitch – especially when you’re going at it alone (like me). However, I’ve grown sick and tired of helping Wannabe entrepreneurs who typically have the lasting power of an easily excitable 16 year old virgin schoolboy.

Hence, I’ve been forced to be selective with the people who reach out to me – not because I want to be aloof, but there’s just so many things to do, both at work and at home. In the comment section of my previous blog post on Wannabes, I specifically called this out –


Tying this back with my earlier point: “practicing” being an entrepreneur for 10,000 hours won’t make you an entrepreneur. But if you’ve sold more than $1,000,000 worth of your stuff… then you’re legit. Welcome to the club.

Especially relevant for those running online businesses: trust me, you don’t know jack until you’ve generated the first 1,000,000 organic clicks to your site. Reading books, attending seminars and downloading Guru courses on “How To Make Money Online In Your Underwear” for 10,000 hours won’t make you an expert.

Staying Out Of The Wannabe / Watcher Trap

Here’s a profound quote from Jim Lovell, astronaut and commander of the famous (and ill-fated Apollo 13) –

“There are people who make things happen, there are people who watch things happen, and there are people who wonder what happened. To be successful, you need to be a person who makes things happen.”

You want to avoid being a Watcher.

Want to stop being a Wannabe investor? Simple. Put down that book, stop reading property blogs (ahem) and go find a property to buy.

Want to stop being a Wannabe entrepreneur? Easy. Do nothing but sell $1,000,000 worth of your wares. Trust me – you already know enough in your gut to get to your first million. Go do it.

Here’s What’s A Hell Lot Worse Than Being A Wannabe…


Last week I had lunch with Calvin in Mont Kiara, an old friend whom I had known since my childhood days in Taiping.

“I was in Edinburgh over the new year,” he said. “Here, I bought you a souvenir.” He tossed a gaudy-looking  fridge magnet on the table.

I could never quite understand why people would buy tourist junk for their friends when they go on trips.

“This ugly piece of crap is a testament to your complete lack of good taste.”

He laughed out loud. “When I saw it, I just knew that I had to get it for you!”

“So what were you doing in cold, wet Scotland for winter?” I asked.

“I went to this business seminar. There’s this Guru who lives in this 15th century castle north of Edinburgh, and there he throws a seminar once every eighteen months.”

Calvin knew that I had a distaste for all things Guru, and I was quite sure that he was baiting me.

“OK, I’ll bite. So what did you learn from this Guru?”

He smiled. “Plenty! How to set goals, having the right mindset, how to negotiate deals, getting funding, setting up partnerships, masterminding, pitching… all the good stuff.”

I sipped on my black coffee.

“It was one of my best investments, ever,” he enthused. “Considering that over the years I’ve paid this guy more than $150,000 in total.”

I nearly choked. “Either there’s something here that you’re not telling me, or you’re the biggest sucker that I’ve known in my lifetime.”

Would You Pay $150,000 For Business Advice?

Unlike the rest of us who left Taiping after high school for college, Calvin did something different. He stayed back in Taiping and instead of furthering his studies, he decided to take up an apprenticeship with a property development company owned by our mutual friend Yau Wye’s father.

Calvin was somewhat lacklustre academically, and after school, instead of going to tuition classes like the rest of us, he would spend his afternoons at Pusat Hiburan Loo Foo Chi playing Street Fighter coin-op machines. Calvin had barely passed his SPM.

What he lacked in book smarts, however, he made it up with his street smarts. Within three short years working for Yau Wye’s father, he had gained enough experience and capital to set up his own shop. From there, he started off with building some simple terrace houses which sold well. He has kept his company small, and over the years he had made pretty good money building moderately priced landed properties in Taiping and occasionally, Ipoh.

So there’s absolutely no question about Calvin’s hustle. Starting a boutique development company and making it profitable is no stroll in the Lake Gardens, and for this I have lots of respect for him. And given his success, I wasn’t about to question is judgment of paying $150,000 to a Guru for “business advice”. But having known Calvin and how shrewd he was, the Guru must be exceptionally good to worth that much coin.

“So would you recommend this Guru to others?” I asked him.

Looking me straight in the eye, he answered me curtly.


What’s A Hell Lot Worse Than Being A Wannabe

“But how come? You sounded like you’ve gotten the best bargain in a lifetime, and yet now you’re saying that you don’t recommend others to make the same investment. Why?”

Calvin smiled. “Khai Yin, this man’s ideas changed my life. I’ve grown my business to $50,000,000 last year based on this one thing that he asked me to do. You tell me what’s the ROI on that!”

“OK, I’m waiting for the catch.”

He leaned forward. “I’ve started seeing this man every year since 2009. In the group, there were nine others who came from all parts of the world with different types of businesses and backgrounds. Here’s what completely surprised me. Virtually everyone else failed to implement anything that the Guru told them. I, on the other hand, tested only one of his ideas and the returns came back in spades.”

Always learning, never executing. That’s the mark of a Wannabe,” I said.

“Yep, I’ve seen your article on investor Wannabes at your blog,” Calvin replied. “But Khai Yin, you know what’s worse than being a Wannabe?”


A Watcher. Somebody who sits on the sidelines and watch the others get rich. The other seminar participants paid big money not to learn, but to be entertained. There’s cheaper ways to be entertained. You don’t pay $150,000 and go to faraway Scotland to get entertained. But sadly, most people just want amusement, not education. They just want to Watch.”

Do you want to get rich, or do you just want to Watch?

Are You A Wannabe?


Last week during our monthly Mastermind meetup, I had posed this question to the Mentor and my peers:-

Are great investors born, or made?

The answer was unanimous: “You don’t born great. You make yourself great.”

That was somewhat surprising to me because among this group of wealthy, overachieving, ultra-domineering alpha male (and female) types, I had expected at least one smart aleck to attribute his success to having superior investor genes as a baby. But no.

“As un-sexy as it sounds, Khai Yin, it’s all about practice, practice, practice. Repeating something over and over is how we learn the skills of property investing,” said Ari.

“That sounds awfully similar to Malcolm Gladwell’s 10,000 hour rule,” I said.

RELATED: The 10,000 Hour Rule and its Rebuttal (external links)

The Mentor laughed. “10,000 rule? That’s probably one of the biggest Guru truisms of the recent times. I don’t deny that there are some people need to do the full Monty and practice for some 10,000 hours, but only if they do it the wrong way.”

“And we’ve all started doing it the wrong way. What’s stopping you from taking action? You get sucked into reading, thinking, researching and analyzing stuff because you think that you don’t know enough. There’s always a new book to read, a novel investment trick to learn, a new Guru to follow, a hot property location to research,” added Shahira.

I held up my hand. “Guilty as charged. And with GoodPlace, I might even be making this problem worse for many people.”

The group laughed. “How many people’s lives are ruined by you, Khai Yin? Information overload is a real problem, and with your blog you’re aggravating it!”

Information Overload? There’s No Such Thing, And Here’s Why!

“Hold on, guys,” Munirah interjected. “Sorry to burst your bubble, but there’s no such thing as information overload.”

The laughter stopped.

Munirah looked at the Mentor. “That was the first thing that I learned here at the Mastermind many eons ago. There’s no information overload, only filter failure.”

The Mentor smiled. “OK, first, a disclosure. That idea’s not mine, but I’ve handily nicked it for my own use! If you’re only consuming information without taking action, blame yourself… you’re just not discerning enough! When you know the sufficient amount to take action, you’ve just got to put your blinders on.”

“And taking action is what separates the men from the boys, the doers from the talkers,” Thomas chimed in. “And with anything that involves making money, there will always be more talkers than doers, and you want to quickly move from being a mere wannabe to an action taker.”

Signs Of A Wannabe Property Investor

Check all that apply:-

  • You read books and blogs (ahem) for entertainment. You tell yourself that you’re “learning”, but you’re just finding an excuse not to take action
  • You blame information overload for your inaction, but the reality is that your information filter is dysfunctional
  • You are a seminar-infesting, Guru (Rich Papa Pokai Papa?) worshiper
  • You think you can do this all on your own without help
  • You dabble in multi-level marketing (MLM) and insurance schemes in your spare time while you “learn” about property investing

Look: there’s absolutely no shame in being a wannabe. In fact, everybody in this business has been a wannabe sometime in their lives. But, the sooner you realize that you’re just a wannabe, you can then quickly make the leap to be a bona fide investor. The longer you stay inside the “wannabe investor” trap, the harder it would be for you to get out from that bubble.

How The “P Factor” Can Mislead You Into Making Bad Buying Decisions

Masterminding at GoodPlaceHQ!

A very close friend of mine came to have lunch with me at Setiawalk last Friday. She had wanted to ask me about this money making idea that she had.

“Khai Yin, so here’s the deal. As you know, my cookie baking skills is pretty ninja. Over Chinese New Year, I managed to sell some $1,000 worth of pineapple tarts and kuih kapit. Everyone I sold to told me how much they loved my cookies! So I’m gonna quit my job and answer my true calling… starting a baking biz! What you reckon?”

“Pardon the pun, but that sounds like the recipe for a total clusterf*ck. Don’t do it.”

She didn’t appreciate that comment, and left without paying the bill.

The problem with friends and family when it comes to getting business advice is, well, that they are friends and family. They will never want to tell you that your ideas suck (especially when it’s true!).

For the same reason, I like the group of people that I currently hang out with (members of my Mentor’s Mastermind who had made a lot of money in the local property scene). They are not my “friends”, but rather a couple of stand up individuals whom I could count on to give me the straight talk without having to give a turd about ‘hurting’ my tender feelings.

Couple of weeks back I had written about the “P Factor” theory which asserts the importance of population growth in picking winning property investment opportunities (read this if you have missed it). During our last Mentor Mastermind meeting this became a heated topic for debate because, well, the group thought that I was over-simplifying the concept which could mislead especially those new to the game.

Below is a summary of the opposing viewpoints of the members of the Mastermind: I shall post my response in the next homebuyer guide in the following week.

Shahira: “The P Factor Is Necessary But Insufficient”

Shahira is a self-confessed uber conservative property investor who has written an article calling me reckless and accusing me of writing stuff which leave a bad taste in the mouth. Love you, Shaz!

To some extent I agree that the “P Factor” may well be the single biggest characteristic that I look out for when I look for good investments. Indeed, if the population of an area is stagnant (or worse, declining), it’s a deal breaker for me. Yes, this means that I typically never consider anything apart from Klang Valley and Penang these days. Yes, even Iskandar is out of my radar for the very same reason…

That said, my interest spikes whenever I read about rapid population increase in an area because that means that there’s money to be made in the area’s real estate. Population growth is absolutely necessary, but hardly sufficient. I will then look at the factors which drive the increase. Specifically, is there infrastructure and facilities in place to sustain the growth?

What’s important to me is generational, and not “one-off” growth. This means that transportation, schools, shopping malls and hospitals are infrastructure which sustains generational growth. “One-off” growth areas like the designation of a new industrial zone or an “education hub” is of no interest to me.

Slayer: “The P Factor Is Misleading”

The Slayer is the pseudonym of a Gordon Gekko-worshipping property flipper who happened to double up as a drummer of a cover 80’s thrash metal band.

OK, speaking from personal experience here. I once bought a house because it was an area with flourishing population. But it flopped big time… I made a measly $5,000 over six years which was pretty crap by any account.

Why did it flop then? Well, here’s the reason. While the area initially had a steady population inflow from the promise of a fledgling retail and industrial enclave, over time the interest dissipated when buyers moved on to other brighter and shinier opportunities.

Employment opportunities in the area soon dried out, and the population then slowly started to decline. Indeed, this is hardly an isolated case as over the years I have observed this phenomenon:- large areas shrink when employment dries up.

So this is what I am saying here: “P Factor” as a number on its own is misleading. Instead, you want to look at trends.  A “big” population number is not indicative of anything. On the contrary, you can almost bet on smaller areas with huge growth upside and win big.

Munirah: “Don’t Forget The Other Side Of The Equation”

Munirah thinks that chasing money in property is foolish. Read why here.

Essentially the P Factor is an indication of buyer demand. To predict pricing trends, you need indications of both buyer demand and housing supply. So, the P Factor is just one side of the equation… you need supply information also to check if an area has got potential or not.

So here’s an example. Johor Bharu and the Iskandar region has good population growth, but new homes are being built faster than the rate of population inflow. Unless demand catches up with supply, suppressed yield and below average capital growth will persist.

Of course, if there’s no demand, everything else is immaterial. From that perspective, the P Factor can be a good quick-and-dirty qualifying filter.

Ari: “Look For Growth In Income Potential Instead”

Instead of growth in population, I like to look at the growth in “income potential” instead (i.e. the “GDP” of the area). This means that I am interested in areas where there is rapid growth in middle to high income job opportunities. These are areas with higher disposable income which means that yield is above average, and this jives with my “buy for cashflow” style of property investment.

I am not denying that there is the growth in income potential is correlated to the growth in population. However, the income potential growth is a more indicative measure of the quality of a property investment opportunity.

Baller Secrets To Selling Awfully Expensive Real Estate

Megan K at GoodPlaceHQ

Today’s GoodPlace homebuyer guide is written for those who are in the business of selling luxury properties. Now if you’ve been following our rather rollercoaster-y trajectory from our early days as a property blog to our present day incarnation as a fully fledged property portal, you’ll know that GoodPlace is somewhat partial towards upmarket properties – KLCC condos, Bangsar bungalows, Damansara Heights mansions and the like. As such, those in the business of flipping Menglembu low cost flats, for example, should probably plow their trade elsewhere.

And as my ex-boss Mark Chang once told me, money can act as a customer “filter” of sorts, and when you price your product upwards enough you’ll attract customers who are, well, less of a pain in the proverbial arse. In short, it’s a wise business decision to price yourself out of reach for cheapskates, jerks and tire kickers who will just leech on you like someone you met at a party who turned out to be an insurance salesman during the day and multi-level marketing dabbler after dark.

I have found this maxim to be especially true in property – when you’re dealing with sufficiently upmarket properties, you’ll end up dealing with a smaller number of prospects (albeit of higher quality). Of course, there will always be that faker pretending to be interested in that Binjai On The Park penthouse so that he can get a free tour in the hope of catching a glimpse of Ananda Krishnan hanging out in his PJ’s at the balcony savoring a fine Cohiba.

However, it’s quite trivial to spot a faker if you’re in the business long enough – you’ll understand and appreciate the importance of qualifying your leads before you start doing the tedious co-broking legwork. Ask enough qualifying questions and these cheapskate types will naturally find you to be repulsive as if you’ve contracted the Zika virus.

What Makes Upmarket Properties Different From The Mass Market

Elizabeth has been an agent in the luxury property niche for more than 15 years, and is somewhat famed in the negotiator circle for closing multiple deals in upmarket Mont Kiara even when as market halted to a complete standstill last year (think MK10, Seni Mont Kiara, Sunway Vivaldi). When probed about her secret sauce, this was what she told me:

“Many negotiators mistakenly think that they can transition from mass market to the upmarket by spending a little bit more on advertising. They think that they should just buy more ads, or bump their ads up the search results at property portals more frequently, but it’s really not that simple!”

I nodded. “Pardon the pun, but cookie cutter marketing really doesn’t cut it when it comes to selling awfully expensive properties.”

“Yes,” said Elizabeth. “What the typical sellers and their agents fail to understand is that rich folks buy property for entirely different reasons than the usual Joe Blow.”

“How so, exactly?” I inquired.

“The typical Joe Blow home buyer is concerned about stuff like leasehold vs freehold, commercial vs residential status, monthly payments and so on. For the rich, on the other hand, the intangibles become more important.”

Nobody Buys A Ferrari For Its Horsepower

I once knew of a Ferrari salesman who told me that he would look forward to whenever a new model comes out.

“So here’s the deal,” he told me. “Whenever a new model is gonna come out, like a California T or whatever, I know that I’ll make shitloads of money. There’s no negotiation, no begging, no selling needed. The demand for these machines are just so darn high. I just have to stand in the showroom and take orders.”

“It can’t be that easy,” I said. “At the very least the buyer would surely ask about its specs, like, the size of the engine?”

“Khai Yin, my man,” he smiled. “Nobody buys a Ferrari for its horsepower.

Nobody Buys Four Seasons For Rental Yield

“Here’s what you need to understand,” explained Elizabeth. “The awfully rich buy awfully expensive properties not for yield and capital returns.”

“So this is where the run-off-the-mill negotiator or seller fails,” I offered. “Their cookie cutter pitch is usually around how much rental the property will fetch, or how much the buyer can expect to make when she sells it. You’re saying that these don’t matter to the affluent buyer.”

Elizabeth nodded. “Yes, they really don’t matter that much in the grander scheme of things. There are other more important stuff. In order to close a sale with these affluent buyers, you’ll need to get into their minds and know what’s important to them…. and what makes them tick.”

The Affluence Concept of Return On Investment

According to Elizabeth, to the affluent buyer, the concept of Return On Investment (ROI) takes a slight twist. “To the mass market buyer, ROI is wholly financial. To the rich, on the other hand, ROI is emotional. Just like the rich dude who buys a sports car because it makes him feel young and sexy, the property ROI for the rich is all about the emotional return of investment.”

Emotional ROI. That’s novel!” I chuckled.

Elizabeth smiled. “So here’s the deal. Experienced upmarket property agents work the emotional ROI angle. Rookie agents forever blab about financial ROI and wonder why they screw up.

Here’s one idea that I truly believe but is not (yet) accepted to be true by most people:- upmarket properties have very little to do with price. If a rich person really wants a piece of luxury property, he or she will pay almost anything for it. When buying upmarket homes, the returns are emotional, not financial.

Emotions First, Numbers Second

Of course, rich folks still do the same number-crunching like the rest of us when it comes to evaluating property investments. In fact, most affluent people are careful not to overpay for a piece of property – that’s how they have gotten rich in the first place. It’s just that since budget is not the primary factor which drives their purchase decisions, they can afford to relax their “cold number” requirements like (financial) ROI a little more.

Property is often an emotional buy (even for Joe Blows), but more noticeably so among the affluent. When you sell to the affluent, work on their emotional hot buttons, and go easy on the “hard” aspects like yield, financing options or even Walkability. Remember, nobody buys a Ferrari for its horsepower.

Why The Play-It-Safe Approach To Investing Makes Sense (Even When You Swim With The Sharks)

Shahira Jamsari

Allow me first to introduce myself. My name is Shahira, and like many of you I’ve known Khai Yin through his work here on this blog as well as his property deal matching service. As he is going away for a week or two for the Chinese New Year festivities, I am standing in for him as a guest blogger at least for this week. Truth be told, I really look forward to the GoodPlace Digest that he publishes every week on Wednesday like I would look forward to Saturday morning cartoons as I was a little girl back in the 60’s in rural Besut, Terengganu.

Khai Yin told me that no topic is out-of-bounds as far as this blog goes, and if you’re a long time follower of GoodPlace (say, 1+ years like me!) then you’ll remember some brickbats that he received over some rather “edgy” content that he had published – both on this blog as well as on his newsletter. Therefore, I’ve been given a free hand on what to write this week (yes, he has given me access to the backend of this website, and gawd, I feel powerful), and so nothing will be sacrosanct – including Khai Yin and what he writes and stands for!

Indeed, recently I have noticed that Khai Yin have become rather reckless in his latest blog postings – which included an article on how to exploit desperate people and also how to sell to newbies who don’t know any better. Of course, I’ve also realized that his writings have become rather satire-ish recently (read his entertaining guide on how to be a jerk investor – will make you chuckle because it’s all so true), and he might have written those articles in tongue-in-cheek fashion, but publishing a guide on how to “prey” on people in desperate situations like death and divorce simply leaves a bad taste in the mouth. Additionally, he had also talked about some rather risky tactics (dubbed the Gekko Tactics – like the one here and a few more elsewhere) which I rather he would not give light to because I know some fanboys of his who would just run with whatever he says here on this blog. Really, this site should’ve come with a parental advisory sticker of sorts!

Playing It Safe: The Other Option

So what I am doing here today is to present an alternative (albeit relatively un-sexy) view to what Khai Yin would usually write these days. Maybe this article won’t get as many views as his guides normally would, but I have grown to love GoodPlace, and so it’s up to me to restore some sort of “order” by presenting a sane-r point of view to counter balance the risque stuff that he writes. And so here goes…

Clearly I am not in the league of Khai Yin’s friends inside his Mentor Circle, but having said that, I’ve developed a rather healthy portfolio of landed assets (as well as a couple of budget hotels) over the years that has made me free from the shackles of a desk job. However, my style is conservative perhaps to a fault; I buy only “safe” properties which would appreciate really slowly over time. This investment philosophy is entirely design:- I look for “set and forget” properties, run them through a qualifying filter, select one to add to my portfolio, and then move on to the next property – maybe one every two years. Spending my days and nights looking at properties and analyzing them just doesn’t appeal to me… I am as passive as they come as far as property investments are concerned.

I found that by “playing it safe”, I cut down the work required since I don’t have to pour over data and go on site visits to look at houses. Of course, this goes against what many investors would suggest you do (especially Khai Yin who, as far as I know, likes to rely on quantitative analysis to select properties to buy), but it works for lazy people like me 🙂

The Uber Conservative Investment Style

The Malaysia property market is infested by what they call “sharks” – it can be as cutthroat as they come, but this is only to be expected as it is one of the most lucrative ways to make relatively large amounts of money in relatively short amount of time. Thankfully for me, these sharks don’t usually get attracted to the opportunities that I look at because they are decidedly un-sexy and appear to be less lucrative (at least in the short run). Anyhow, I still believe that even if you proverbially want to “swim with the sharks”, my conservative investment principles will still give you an edge especially if like me, you’re investing for the long term.

Just like any conservative investor who carefully selects his or her property investment targets, I have developed a strict selection criteria which I sum up below:-

  1. I don’t buy cheap properties just because they are cheap. Strong growth prospects in the long term is a must – no matter how slow it gets. Upside potential is the most important consideration.
  2. Branded developers only. I don’t hold anything against smaller developers, but I like the bigger companies better – especially when they are listed. The reason is simple: when they’ve got shareholders to answer to, they won’t (usually) screw up!
  3. I make it a point to avoid the latest fads. I have once avoided luxury condos because they were springing up too frequently for my liking in central KL. For now, I’m not investing in Soho/Sofo/Sovo/So-whatever because they have turned too fad-dish for my liking.
  4. Buying less than market value is always desirable, but whenever the asking price is ~20% less than market value is always a sign of trouble. I like the -5%-10% pricing band because it’s a sweet spot: but this is immaterial as long as criteria (1) above is fulfilled.
  5. I will hold on to properties for at least 10 years.
  6. I look for properties with “unique selling proposition” to borrow a popular marketing term. For some it could be an unblocked view of the KLCC towers, or freehold status in the middle of the city. Something that creates scarcity will always appreciate in value over time.

Sometimes it’s really hard for me to find something that will fulfill all the criteria above, but if there’s one thing that defines the conservative investor is to be especially strict in following the rules, and not to yield to temptation.

The “Big P” Factor: Ignore This And Your Investment Will Suck

Damansara Heights

Khai Yin, I get really depressed whenever I go back to Ipoh these days,” Kenneth told me when he came over to visit me at the HackerHub last week.


“They’ve been building a bunch of semi-D’s just right behind where my folks live. I’ve been to the show house a couple of times… very impressively done with lots of extra trimmings. Pretty spacious, too… even the smallest measured a hefty 30 x 80.”

“How much though?”

“RM450,000! Can you believe it? On a PSF basis, we are talking only about RM190-ish.”

“That’s probably the price of a mid-sized condo in Puchong in the sub sale market, give or take.”

“Exactly! And that’s why I feel so miserable, man,” he groaned. “I don’t think I can ever afford a semi-D in KL. I was this close to book a unit… but thankfully I quickly came to my senses…”

I nodded. “You almost made that classic newbie error… mistaking cheap for value.”

He sighed. “Yeah. If I were to buy it for own use, I would have plonked down the booking fee in a heartbeat. But I’ll never move back to Ipoh, and so if I am to buy a property there it would be for investment only. And that semi-D unit, as cheap as it was, would never make me money.”

The “Big P” Factor That Drives Prices Up (Or Down)

The Mentor once told me, “There’s just a small handful of very important factors that will make or break an investment. And the biggest of these salient factors is what I call the Big P.”

“Big P?”

Population,” he explained. “You always want to invest in places where the population is growing. Go where the crowd is and you’ll never go wrong.”

“A house may look wonderful and it may well seem to be a good deal, but it’s meaningless if there’s nobody who is going to rent or buy it,” I offered.

The Mentor nodded. “Remember that fundamentally, the valuation of a property, or any business in general, is the function of the cashflow that it generates. And obviously cashflow is entirely dependent on the market of renters. Correspondingly, whether a price of a property will go up or not will depend on the market of renters and buyers, and if the size of this market goes up, it usually means that the price of the property will go up correspondingly, typically at 2x or 3x the market growth if not more.”

“Is there a good way to know if the population of a town or area is growing or shrinking?”

He smiled. “For a self professed data geek this question seems a little odd coming from you. Be resourceful! Official stats can be obtained from the government, and not many people know this, but you can also make a request for unpublished data which is subject to availability and confidentiality.”

“Data sources aside, I am referring to new developments or infrastructure in the area which is always good proxy to population growth. Examples of these are:-

  • New communities by big developers. I would look out especially for mixed developments where people would live and work in one huge enclave as these would typically encourage population influx into the area. In the Klang Valley, these huge scale mixed developments are often built by the bigger, branded developers.
  • New sports facilities. New stadiums and sport complexes can draw thousands of people into the area and open up investment opportunities. The National Sports Complex, for example, spearheaded the mini Bukit Jalil “revival” when it was launched in 1998 for the Commonwealth Games.
  • New educational institutions. Colleges and universities are by nature population boosters since they would pull in students as well as lecturers (both local and foreign) into the area. I would especially pay attention now to the EduCity project in Iskandar for example.
  • New roads and highways. An obvious example would be how the Penang Second Bridge opened up the Batu Kawan and Batu Maung areas.

The Mentor chuckled. “Very good. You should always validate data with qualitatives or even better, on-the-ground observations like you have suggested. Looks like I’ve done a good job in mentoring you!”

Exception To The Rule?

If you intend to buy a piece of property for own stay, then what I’ve written above in this guide may not be that relevant to you (assuming that you’re not going to have a sudden change of heart and flip the place for profit). A piece of property is only by definition a “dud” if it doesn’t fetch a higher price when you sell it, and correspondingly if you’re not going to sell it anytime soon then the point is moot.

On the other hand, if you’re looking for property buys to invest your hard-earned monies, then understand that plus-sized bungalows in rural Menglembu are just not going to cut it even if they may come as cheap as junky Guru books in the MPH bargain bin. Trust me on this!

How Not To Be Suckered Into Scammy Property Deals

Georginna Tan

This article is contributed by my lawyer friend (and rumoured vigilante) D. Sidhu.

As with anything where substantial money is involved, the Malaysia property industry is rife with illegal schemes and con jobs targeting the gullible and the greedy. There are hundreds of laws that come into play when it comes to buying and selling property in Malaysia, and even if people don’t realize it, they are probably breaking a few when they perform a property transaction.

Does this mean that these law breakers are going to prison? Maybe not, especially if their transgressions are not that serious, and even if they get reported, the authorities may not take action against these ikan bilis types who don’t usually have malicious intentions in the first place. This is especially so when nobody loses money in the aforementioned transaction.

Like what some might say, it’s all fun and games until somebody loses an eye. Also, just because you’re unlikely to get caught doesn’t mean that you should knowingly flout the law. Any Malaysian would have faced situations where he or she would be asked to do things “under the table” or “tutup sebelah mata”, etc. You’ll encounter many of these kind of situations especially if you are in industries with high stakes (such as property) where people would often justify such behaviour by saying things like, “if you don’t do it, others will”.

Remember that you only need to get busted once, and your reputation is possibly tainted for life. Walk away from a deal if the seller, buyer, agent or lawyer asks you to lie or hide substantial information on the transaction. Avoid doing business with people who do those things – even if you only have a small part to play in the transaction.

What I am going to share with you next is a list of frequently dubious schemes which warrant further scrutiny if you ever come across these opportunities. Of course, similar to schemes like Multi Level Marketing (MLM) there are perhaps a handful of legitimate opportunities sunk in the haystack of dodgy deals (although Khai Yin could claim that all MLM schemes are dodgy!), but if I were you I’d walk away instantly the moment you find these pitched to you.

Private Deals

From my experience, any organization which are set up solely to promote a series of “private” (or “insider”) deals to their members is highly dubious. Usually these organizations make money through what I call “triple-dipping”: (1) from the membership fees that they charge you in a number of ways (one-time fee, yearly fee, “administrative” fee, etc), (2) from seminars and overseas trips, and most substantially, (3) the commissions that the organizers get from selling dodgy properties made by dodgy developers to you.

In many occasions you’ll get to read some pretty exciting testimonials from members who have made money in these property clubs in the past, but remember that even idiots look like geniuses in the bull market. To quote Warren Buffett, “only when the tide is out you’ll see who is swimming naked.” No property clubs are going to show you their “private deals” which have gone bad.

Private Launches

“We’re only launching this privately, and right now we are already 90% taken up. I can reserve you a special unit if you can pay the down payment today.”  Yeah, right, bucko. Any reputable developer wouldn’t even need to launch anything “privately” because there would be beelines forming outside their showrooms. Usually these private launches are accompanied by glitzy shows and blatant pitches disguised as Guru and Fengshui Master “workshops” coupled with high pressure “last day today” selling tactics – if you see any of these telltale signs then you know that you’re in to be suckered into a scam.


Syndications are a method to raise capital from investors to buy properties in a large scale. REITs (real estate investment trusts) are a type of syndication, and I will have to make it known here that these are perfectly above board (especially when they are public). These REITs operate by pooling large sums of money to buy commercial properties like shopping malls as well as office blocks. Public REITs are “safe” because the information is disclosed publicly and therefore under higher market scrutiny which lessens the risk of mismanagement and fraud.

What I have reservations for are private REITs; these are offered to private investors and therefore may fly below the radar since they are not subject to public scrutiny. For this reason, the risk of potential abuse and misrepresentation as well as fraud is higher.

Another variation of the same idea is the current trend of crowdfunding. I personally have grown to dislike it, and Khai Yin has written quite blatantly that crowdfunding stinks. Avoid.

Credit Faking

The scheme works like this: the scammer pitches you some dubious deal which promises 10% gain on flip or something spectacular like that. However, you don’t have the credit history to get a bank to loan you $2,000,000 you need to buy that property. Therefore, the scammer would “fake” hire you into his organization, paying you $20,000 a month for three months so that you can establish a line of credit. In some cases, the scammer might even forge payslips for you.

You then use the fake payslips to get the $2,000,000 loan. Then you find out that you’ve bought a dud, and you have problems flipping even at the price that you’ve paid for it, much less at 10% gain. You’re now stuck with a $10,000 monthly installment for a piece of property that you have overpaid for. Margin calls are rare in this side of the world, but be prepared for the proverbial shit to hit the fan if your dud property continues to drop in value.