Building A Rental Home Empire

Building A Rental Home Empire

A real estate negotiator with Jann Properties, Rohit Singh who turned property investor only two years ago, now has a few properties to his name.

As a child, he used to trudge along to his late father’s renovation excursions in getting an apartment ready for a tenant. “My dad owned a few residential units which he rented out and I always helped with the painting, maintenance works and fixture fittings,” shared Rohit.

HOW IT STARTED

Rohit has worked in the airline industry since he was 18, until two years ago when he decided that there is more to life than working for a wage and spending what you earn.

When deliberating on how he could secure his future and be financially sufficient – real estate came to mind as he had seen first hand how rental properties provided his dad with passive income.

He figured what better way to get started in the property investment line than to be a real estate agent himself. After careful deliberation, he made the jump and signed up with Jann Properties as a negotiator in 2014.

“It was not a spur of the moment decision as I have always toyed with the idea of being a realtor. I was very close with my own realtor, Jeffrey and as he got to know me better over the years, he encouraged me to join the business.

He told me that all my potential and passion for real estate will be wasted otherwise and I thought why not!”, Rohit laughingly shared.

PUTTING HIS MONEY IN AREAS HE KNOWS BEST

Rohit purchased his first property at the age of 21 as he wanted to own a property. He bought his first sub-sale apartment in Bangsar South, the very area where he has been renting for a few years.

Rohit believes that he is lucky to have made the right move in buying “well” from the start. He was not really sure that his first purchase was a high capital growth property, which in turn provided him with sufficient equity and cash to buy more properties in the future.

“As I loved living there myself, I figured that it must be a tenant hotspot and I cannot go wrong with purchasing a residential unit in Bangsar South,” said Rohit.

True enough, the apartment which he purchaed eight years ago has now almost tripled in value; its current market value is RM500,000 – which translates to an average of 37% capital appreciation per annum.

It goes without saying that the monthly rent rates have been increasing steadily over the years as well. Rohit has enjoyed a positive rental growth since 2008.

Unsurprisingly, Rohit is an advocate of purchasing rental properties in your own ‘home turf’. Recognising Bangsar South’s appeal as a tenant hotspot has influenced him to purchase two more apartments in the area in the past two years and until today, all three apartments have never been short of tenants.

APPLYING WHAT HE HAS LEARNT

Being a real estate negotiator has helped sharpened Rohit’s mindset to be a serious property investor. His real estate agent platform was very helpful in guiding him where to look for properties and his mentors gave him realistic investment advice in terms of financial aspects and tenant management.

“Not only is being in the business helpful when it comes to researching for investment options but my job has taught me to be more entrepreneurial in thinking and provided me with ‘land-lording’ practise.

Most importantly, I have gained a lot of advice from experts and learnt how to have the right financial and legal structures in place to support multiple rental properties,” revealed Rohit.

His three other investments are all located in niche areas such as an apartment each in Puchong, Old Klang Road and Bandar Sunway. All bear the same fundamentals – near public transportation and economic centres such as hospitals or universities.

OTHER FUNDAMENTALS

Rohit explained that a prominent address does not suffice. He stressed that one still have to conduct the appropriate due diligence on the neighbourhood and property.

It goes without saying that doing your sums carefully to ensure that your property investment will pay for itself is a must, i.e – your rental income must cover the monthly instalments with some profit to spare.

“Your monthly rental rate should always exceed 5%,” he added.

For Rohit, the main cornerstone in maintaining a positive cash flow is to only buy properties that are well below market value. As he puts it, “Opportunities are aplenty, you just have to be diligent in searching for sellers looking for a quick sale or for one that is willing to negotiate.”

LESSONS LEARNT

Encouraging other Gen-Ys out there, Rohit says that the fact that you are not in a high paying job should not stop you from investing in properties. His big tip is to set your goals and work hard towards them.

There is no slowing down for Rohit, he holds his mentor’s quote close to heart – ‘The best job to have is to be a landlord; as long as you keep all the boxes checked, passive income will flow in automatically each month’.

Moving forward, he will continue to build his property portfolio and is planning to look into refinancing his older properties.

This article was first published in the iProperty.com Malaysia October 2016 Magazine. Get your copy from selected news stands or view the magazine online for free at www.iproperty.com.my/magazine.  Better yet, order a discounted subscription by putting in your details in the form below!

 

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