Sunway Velocity 2: The Best Property Investment in Malaysia in 2019?

You guys may have heard about Sunway Velocity 2: The Best Property Investment in Malaysia in 2019? Or at the very least Sunway Velocity?

If not, let me clue you in on what might just be, the best property investment opportunity in Malaysia in 2019.

[Check Out Our Pick Last Year in 2018]

Sunway Velocity is a relatively new fully integrated development located along Jalan Cheras by Sunway Group. The location is completely unique compared to all the other new integrated developments in Malaysia. Its strategic location has it right in the middle of 3 MRT stations and 2 LRT stations – Maluri, Cochrane (no LRT station) and Chan Sow Lin (being completed).

Sunway Velocity 2 Map

The MRT and LRT stations are all connected via covered walkways and are no further than 1km from the link bridge of the development to the entrance of the station.

The first phase of the project, Sunway Velocity 1 was completed in 2013 and consists of residential serviced apartments, a shopping mall, a hotel and a medical center. It is just 3.8KM from KLCC and apparently was the last piece of freehold land in in Kuala Lumpur. It is also within walking distance to Ikea and MyTown Shopping Center. (If you haven’t been to MyTown yet, you’ll be impressed by the retail occupancy rates of the mall)

As far as amenities are concerned, this development has access to everything you could ever want and maybe even slightly more.

Massive Discounts

Being on the fringes of Kuala Lumpur’s ‘Golden Triangle’ you are going to have to expect some pretty intense prices. Sunway Velocity 1’s units were sold at RM1,100 psf and recent transacted values show that they currently go for around RM1,200 psf.

So what are Sunway Velocity 2’s prices going to be like? RM1,400? RM1,500?

Surprisingly, the units are being sold cheaper than Velocity 1!

Yes, you did read that right.

At just RM850 psf (after rebates) you’re getting a 30% discount on what people paid for their properties 4 years earlier to be at almost the same exact location (and don’t we all know how important the location is when making a property purchase).

The only reason I can see for this justification is that Sunway Velocity 1 is freehold and Sunway Velocity 2 is leasehold.

But does that really warrant a 30% reduction in the price to be able to enjoy the same premium location?

You’ll have to be the judge of that.

If you were to ask me though, I think it’s not, and this deal looks ever more attractive to me.

If that’s still not enough discount for you however, you’ll be happy to find out that the discounts don’t stop just there. There’s an additional 5% bumi discount plus a 7% standard rebate and 4% early bird rebate packaged together with the regular deals of free SPA legal fees and also interestingly loan legal fees as well!

[Learn More About Property Taxes in Malaysia Here]

It’s also important to note that this year Pakatan Harapan government is offering free Property Stamp Duty or MOT which means greater savings!

But wait, there’s more!

If the SPA is signed on the preview weekend on 16th March 2019 there will be an extra RM8,000 – RM12,000 additional signing incentive. You’ll have to put your booking fee of RM10,000 before the 10th of March 2019, to be eligible for this added incentive though.

Let’s do a quick recap of all the discounts and deals that you’ll be entitled to so far, just so that you can keep track of them all.

Discount/Rebate

30% off Sunway Velocity 1 prices

5% Bumi Discount

7% Standard Rebate

4% Early Bird Rebate

Free SPA Legal Fees

Free Loan Legal Fees

Free MOT Stamp Duty

RM8,000 – RM12,000 Signing Incentive

The units come in a variety of sizes from 635 sqft up to 969 sqft with different configurations 1+1 bedrooms up to 3 bedrooms. Some of the units also have the possibility of being turned into dual key units with some slight renovation works (of which have been approved by the developer).

Type

Size No. of Units Room Setup

Parking Lots

A

635 85 1+1 Bed, 1 Bath

1

B

840 131 2 Bed, 2 Bath (DK)

1

C/C2

883 88 2 +1 Bed, 2 Bath

1

D

969 88 3 Bed, 2 Bath (DK)

2

G

1119 44 3+1 Bed, 2 Bath

2

* Type G Units are no longer available and have been converted to other unit types
# (DK) signifies Dual Key conversion capability

The project density is also on the low side with its two towers only consisting of a total of 436 units (whereby the first tower’s units have all been completely sold out). From what I’ve heard, the first tower was completely sold out within just the first 2 weeks. This is by no means a high density development.

Bear in mind that with only one tower left, there’s only a total of 436 units available, so time is of the essence here.

Short-Term Rental Income

The deal is definitely starting to sound like an amazing one but what are the rental rates like here? Are you going to be able to supplement your property investment with rental income?

Let’s take a look at the Airbnb rates for Sunway Velocity 1.

Taking a look at Airbnb we can see that the room rates at this low season range from RM135 – RM280 per night, which really isn’t all that bad. Assuming 40% occupancy (12 days) and taking the middle range of 200 per night is about RM2,400 per month in revenue before expenses, which isn’t all that bad considering the cheapest unit starts at RM570,000.

Where it does become much more attractive though, is when you look at the dual key potential of the units. Let’s dive a little deeper and see what the returns look like for a dual key setup.

Single Bedroom – RM135 per night
Two Bedroom – RM175 per night

It’s important to note here that the single bedroom unit is really quite small compared to the studio 1+1 bedroom so we will take the lower limit of what other Airbnb listings are charging instead of taking the middle pricing of RM200 per night like we did earlier for the single unit. With both rooms at 40% occupancy that makes your monthly returns Rm1,620 plus RM2,100, bringing your monthly income to RM3,720 per month!

There will be some seasonal fluctuation in occupancy and room rate pricing but for the sake of keeping things simple, I think the above used room rates are fairly conservative and will take into account these fluctuations for a good overall view of what kind of earnings can be expected throughout the year.

The Clock is Ticking

Sunway has done an amazing job developing this area and the next phase looks like a steal at the current prices and combined with the free MOT you’ll get this year due to the property oversupply, it certainly looks like an amazing opportunity to say the least.

Do drop us an email or get in touch with us if you’re interested to see how you can find out more about the project. Remember, there’s only 436 units up for grabs and you’ll have to get your booking fee in before the 10th of March 2019 to be eligible to attend the unit balloting session on 16th of March.

So, don’t hesitate and get in touch with us today at +6012 935 6495 or drop us an email at info@rentandreturns.com.

*I have vested interest in promoting this project. I do believe the project is a good buy and a worthwhile investment property based on the reasons described above.

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