Why We Love Malaysia Property

Last week I had lunch with a long-time friend of mine who happened to want to start a real estate brokerage in Malaysia. We were having tea in the suburbs of Kuala Lumpur (specifically, in the cafes in Solaris Dutamas in posh Mont Kiara – I have been focusing on Mont Kiara real estate for some time now apart from the oddball KLCC property from time to time).

Support Our Partners!

Support Our Partners!

Curiously, I asked him why. He has been a programmer for a long time ever since he graduated from the esteemed Polytechnic of East Anglia (Associate College Of The Fens) with a first class honours degree in computer engineering.

It’s simple! Being a property broker is cool. I look at the cars you drive and the Patek watches you wear and I feel rather tempted.”

I shook my head. “It’s not enough to be financially motivated, Charlie. You must want to help people. Also, Malaysia property market bull run is coming to an end already with the recent curbs by the government. I suspect the interest rates are going up, which means that the transactions are also coming down in terms of volume.

Undeterred, Charles asked, “What are the hot areas in Malaysia property now?”

I tried to answer him as earnestly as possible. “Let me see. Mont Kiara is still hot, and we see the pricing per square feet is going up to breach the RM1,000 level soon enough. Developments like 11 Mont Kiara, La Grande Kiara and Kiaraville are showing good traction. Also, places like Seni Mont Kiara and Villa Mont Kiara, although expensive, have their own target audience. Expatriates are coming back, and naturally Mont Kiara and other places like the Kuala Lumpur City Centre or KLCC are also popular.”

Tell me more about KLCC.

KLCC

KLCC view… absolutely exotic!

KLCC condominiums and apartments?

There’s where the action is. Property in KLCC are as good as gold. It’s freehold, and the land bank is running out in that area except for some small pockets on Jalan Yap Kwan Seng for example – in front of Taragon Puteri YKS specifically. I have also heard that I-Bhd, which is the property developer behind I-City in Shah Alam buying tracts of land on Jalan Changkat Kia Peng at RM2,888 per square feet. This is quite similar to the land where RuMa is now being built on.”

“So you’re bullish on KLCC?

Actually, I am bullish on Malaysia real estate for the long term. I have built the Springs Real Estate agency here because I like Malaysia’s prospects in the long run. KLCC condominiums and apartments, specifically.”

Charles smiled. “So can you take me in as a property negotiator in your agency?

I sighed. “No, Charles. I think you would suck as a property agent. You are only in it for the money only. What makes you different from a jerk who, say, starts a property site, and then raise angel and venture capital funds, and then sold it off just to make bank?

He cried a little, and stood up and walked away. I have never heard from him since. Shame.

You Should Stop Believing In This Myths… Right NOW!

This article is inspired by this Forbes expose as well as this literary piece by Carl Joon. Call it a SpringsRealEstateNetwork.com specials of sorts. 😉

Unless you work as a real estate agent and a pro purchasing agent, home buying is hardly something you actually get used to. And that is exactly the case for most of us. Because of our lack of knowledge and expert experience on it subjects us to the most ridiculous yet most convincing myths about home buying, which in turn causes us to make the most common mistakes in home buying.

Visit our partners!

Visit our partners!

It doesn’t matter if you’re into something as upmarket as Kempas Utama or as “bottom feeder” as the Haven

To help avoid this, you have to be informed and know how to tell fact from fiction. Here are 5 common home buying myths for starters:

iStock_000019709032Small

  • Myth number 1: You cannot have more than one real estate agent in Malaysia. Because a lot of purchasing agents let their clients sign an exclusivity contract, a lot of buyers think that this is the only way to go, that they cannot buy a house with another buying agent. But that is not your only option. Early on, inform your buying agent that you intend to hire the services of other agents. This way, you are freed of the exclusivity clause and instead be given a contract that will work for you and the agent both.
  • Myth number 2: “You cannot get a mortgage to buy a 11 Mont Kiara unit with a bad credit history,” a negotiator once told me. Nonsense. While a  clean and impeccable credit score will help you get lower interest rates and better deals on mortgage and home buying, it is not a necessity. Your less than ideal credit score will still allow you to get a mortgage, albeit with consequences including being listed at higher risk loans which, in turn, give you higher interest rates. You can get any piece of real estate you want… even if it’s 11 Mont Kiara!
  • Myth number 3: You need a huge amount of money for down payment to buy a house. This was the norm about a decade or so ago, but mortgage lenders have now become more relaxed and tolerable. In replacement of a huge down payment, you only need to present a good proof of income or anything that would prove that you can afford a house. Depending on the lender, you may be required a small down payment (instead of the believed 20 per cent), or be totally rid of it. Presenting a huge down payment, however, still makes applying for a mortgage a whole lot easier.
  • Myth number 4: Renting is better than buying. Sometimes, really, we’re better off with renting. This is especially true if you’re single and not looking to settle down soon. The monthly fees are relatively cheaper, you have less responsibilities, and you can save up more for your retirement when you’re just renting in your younger years. Buying, with the uncertainty of investments in the real estate and the market itself, can be inferior to renting at some point.
  • Myth number 5: All forms of remodeling is a great investment and will raise your home’s market value in the future. Unfortunately, tons of home buyers believe this and end up buying a hopeless house with the hopes of remodeling it and therefore raising its market value. But a misplaced pool or an oversized backyard spa, even an ultra-modern kitchen that would make Gordon Ramsay jealous, could overturn the fates of a house that did not have a good projection right from the beginning.

Post Closing The Deal… What Else?

Now that you’ve already know the questions to ask yourself before accepting an offer, you’ll need to figure out what exactly to do right after you close the deal. But before you do that, support our sponsor by clicking on this banner –

523ca7ad320867e870fecb5a150bf035757d183aAwesome, thanks! :)

Just last week I managed to sell of two of my longest standing stocks, a duplex unit in Menara Pinang in KLCC and a studio unit in Sunway Vivaldi.

Selling your house without the help of a real estate agent can be very rewarding. You don’t have to share your earnings from the Malaysian home sale at all, and that’s a perfect way to define how something is very rewarding. Second of all, doing things FSBO gives you that certain feeling of accomplishment; that without the aid of a certified professional, you have accomplished all of the very difficult parts of home selling.

However, just as rewarding the FSBO experience is, it is also very challenging and can get very confusing for beginners. Oh, and please don’t forget about how very difficult it can be to curb your emotions when you get the very first offer and when you’ve closed an actual deal. And your relative cluelessness, assuming that you’re a first time FSBO home seller, might cause you tons of confusion as to what your next step should be.

So What’s Next?

And so here are some tips on what you should do next when you’ve accepted your buyer’s offer and you’ve practically closed the deal:

First, go to your real estate lawyer. A closed deal won’t ever be fully closed until you get your real estate attorney’s precious signature. So go and run towards your real estate lawyer to get every single paper work done and ready for the signatures. Don’t forget to bring your  signed offer to your attorney – that way, all the contingencies and other facts can be translated into the actual contract.

Next, go to your buyer’s mortgage lender. Set an appointment, bring the offer and the other proofs that your buyer is their client, and let them do the rest. I’m sure you did not let your house go without seeing a pre-approval from the Malaysian mortgage lender right?

In the meantime, prepare to move out. Depending on what you and your buyer have agreed on, you might have to make sure that you are more than ready to move out as soon as possible. You cannot be running around in haste when your buyer starts knocking on your door and decides to move in. Talk about getting your house getting ‘move-in’ ready, huh?

Settle all of the paperwork on your end, especially anything that concerns the land title. This is one of the most, if not the most important document related to home selling and home buying. This should, naturally, be your top priority as far as paperwork is concerned. Have everything, the deeds, the transfers, and all the title-related paperwork ready for transfer to its new owner.

Finally, remove all the necessary affiliation on the said address. Since you’re moving out and someone else is moving in, make sure your light, telephone, water and other service companies are informed. Oh, and that goes without saying that all your bills should already have been paid for before you leave. The last thing you want is your home buyer running after you for unpaid bills and bad client history!

So, are you ready to close the deal and move out? If you need help, contact SpringsRealEstateNetwork and we will help you. Our contact details are here.

Wrap Up

There are tons of decision-making required in getting a house in Malaysia. Trust me, it’s more than just having to pick which house would suit your family best, or which one had the bigger lawn. Especially for those who are on a budget, even the mode of payment is a matter of big concern when it comes to purchasing your own house.

db2a1c2e-f58d-400e-9d16-6af5e04488f7

ADS BY FREEMANTLEMEDIA NETWORK

Apart from deciding on which mortgage lender to get services from, or which payment form to take, or even which way to go with the interest rates, you will have to decide whether you buy a house in a traditional mortgage, buy it via an auction, or get it on a rent-to-own basis.

Given the recent changes as announced by PM Najib Razak in the Budget announcement, rent to own schemes may soon catch up as prices of homes become rather steep for most middle and low income Malaysians.

Reasons to Get a Rent-to-Own House In Malaysia

While some Malaysian homeowners frown at the idea of a rent-to-own house, there are tons of actual benefits to get when you purchase a house this way. And I am speaking from experience: I have got clients who rented who then purchased their respective units in  Soho Suites KLCC three to five years down the line. No joke.

If you aren’t yet convinced on this, here are 5 reasons why you should pick a rent-to-own house over a traditional home sale:

Rent to own house.

Rent to own house? That might be the only feasible thing to do for prudent Malaysians

  1. The monthly fees are almost always lower than a traditional mortgage. While it is a little more expensive than traditional rent, it is still lower than mortgage payments. This is perfect for those who are still trying to save up for the big payments, or those who are trying to get back up from a foreclosure but still making sure that they are still working their way into getting a good home even before they could be eligible again for a mortgage loan.
  2. This is the perfect time to spend your post-foreclosure years. A person who has filed bankruptcy and/or has had a home foreclosed is normally not allowed any form of mortgage until after five to seven years. This is also a perfect time to get their acts together while work towards a real home. You’re not wasting your cash on empty rents but you are actually working towards a real home without having to worry about mortgage applications and eligibility for it until at least the contract expires.
  3. It is easier to be eligible for a rent to own than an actual traditional mortgage. Freelancers and other non-traditional earners in Malaysia who could not pass up the much higher standards of mortgage lenders these days don’t need to go through the regular process for them to get a mortgage loans. The standards are lower, the process is easier. Plus, there is less paperwork involved too!
  4. Brand new homes and condos are offered in this way. If you’re longing to get a brand new house (say, a landed property in Setia Alam), or at least a unit in a brand new condo unit in the neighborhood, the rent-to-own option is almost always more easily available here. So you can easily get the brand new home of your dreams without so much a burden on you financially.
  5. You get a chance to ‘try out’ the house before tying yourself down with all the payments on mortgage. There is no room for regrets here; it is easier to bail out of a rent to own place if you’re unhappy with it, than it is when you try to bail out of it from an actual mortgage.

Still not convinced? Maybe this MSN article will persuade you somewhat. :)

NOTE: Special thanks to Say Jo, Patrick Groove and Steve Sushi for their inputs.

Questions to Ask Yourself Before Accepting an Offer

Every home owner trying to sell his home lives for one thing in this phase of his home owner life: to get the Malaysian house sold. And the biggest step to get into that very important part of the process is getting an offer and closing it.

And…. Here’s Help

But before you jump for joy over the prospect of getting your first offer and sealing the deal, there are tons of things that you have to consider before you seal the deal. See, when it comes to getting an offer, it is more than just the numbers.

IMAGE SOURCE

IMAGE SOURCE

Here are some of the things that you might want to ask yourself (or share with your realtor) before accepting any offer on the house:

  • Is it going to be bought in your asking price or at least within your comfortable range of negotiable price? This is the biggest factor about selling a Malaysian house and getting an offer so make sure that they (prospective buyers) want and are willing to pay for the house at the price that you’re selling it. Remember, once the deal is inked, you can’t change anything or ask for anything more. There’s no room for regrets here!
  • What are the contingencies indicated in the offer? Contingencies are the conditions on the offer and contract that would get the deal closed. As soon as these conditions are met by both parties, the deal is considered closed and the payment is to be expected. Usually the contingencies include home inspections and home repairs for the side of the home seller. Read this carefully to make sure that it is fair for you as much as it is fair for the buyer. Don’t forget to make your own conditions for finalizing the sale known to the other party as well so it makes it to the offer.
  • When is the payment going to be made? It is your right to know just exactly when you are getting your payment otherwise you might end up partially selling your Malaysian home by accepting an offer that does not say when the payment is going to come anyway. It’s like being in an open, unlabeled relationship – an awkward phase at best, a tormenting and uncertain wait at worst.
  • How am I going to get paid? You have every right to know how you are getting your payment: are you getting it in full cold cash, or is it going to come in parts from a financing company? Make sure these are made clear in the offer as well.
  • Am I happy and content with this offer? You may be getting everything right on paper but you may not exactly be the happiest person about it. Whatever it is, it would be to your advantage to actually ask yourself if you would be happy to sign that contract and hand over that house. After all, that’s what matters most – if you’re happy with it or not.

Go over the offer, wait for another offer a bit, consult as many lawyers and as many realtors as you can, and make the right decision. Good luck!