Buying a house
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Research carried out recently by HSBC Malaysia Sdn Bhd, has deducted that Malaysians are one of the world’s most property-obsessed countries coming in at fourth place globally (after UAE, USA and Taiwan) however, within Southeast Asia, Malaysia is the most property obsessed nation!

According to the said research, Malaysians spend longer hours researching about properties (4.37 hours) than they do keeping fit at the gym (1 hour), reading books (1.95 hours), or updating themselves with news (2.27 hours).

Let’s glance through some of the key factors that Malaysians should look into during their quest for property across the country, to reduce the obsession and make one’s selection process seamless!


(From Left) Director-general of the National Housing Department N. Jayaselan, Deputy Minister of Housing and Local Government Senator Datok Raja Kamarul Bahrin Shah, Finance Minister Lim Guan Eng, Redha President Datuk Ir Soam Heng Choon and HOC 2019 organising Chairman Datuk N.K. Tong, pose for a photo after a press conference on Mapex. — Sunpix by Asyraf Rasid


Make Use of the HOC

First and foremost, Malaysians should take advantage of the Home Ownership Campaign 2019 (HOC). As most of us already know, the Finance Minister Lim Guan Eng has announced that the government is working together with the Real Estate and Housing Developers Association of Malaysia (REHDA) and has come up with the HOC 2019.

This scheme has been in place since the 1st of January this year and will continue until the end of this month (June 2019). What this scheme entails is that homeowners of new properties will be able to enjoy a discount of 10% or more during the said campaign duration.

Additionally, under the HOC, residential units priced between RM300,000 and RM1mil would be exempted from stamp duties on the instruments of transfer and loan agreements which translates into substantial savings. Prospective property buyers should take advantage of this extremely rare opportunity and secure a property right now!


Pre-assess One’s Budget and Loan Ability

It is wise to make early assessments of your budget in terms of the down payment that you would need to fork out, your monthly instalments required, the basic move in and renovation costs demanded as well as legal fee and stamp duty as early as possible, as this saves precious time.

Currently, one may be able to extract your credit score for free via Property Technology applications available in the Google Play store for example through providers such as MHub free consumer credit check application aside from checking conventionally via CCRIS by Bank Negara Malaysia and other independent reports such as CTOS to assess your loan ability and loan pre-approval early directly with Malaysian banks.

You could also alternatively speak to a friendly mortgage banker, whom upon retrieving one’s personal documentation will be able to gauge as to how much loan you will be able to take from a bank. Additionally, It is also best to stay within the one third Debt Service Ratio rule, whereby ones monthly property instalment should not exceed one-third of your monthly nett salary.


Carry Out Ground Research

Every prospective property buyer has different needs and criteria when looking for a desired property. Some prefer to live near their workplace or choose a property based on the amenities and maturity of a neighbourhood, while others may prefer larger units offered away from the hustle and bustle of the city.

It is advisable to list down your key criteria and spend time to check out a neighbourhood of choice over the weekends as well as weekdays on different times of the day to get a realistic feeling of what living in the area would be like.

You could choose to dine in the selected area, drive around and check out the time required for you to get to work from the desired property. These factors are important as property purchase requires a lot of funds and adding to that, you will be spending a lot of time in your future home and neighbourhood.


Leverage on Online Resources

Through online property portals such as PropSocial.my, one would be able to retrieve comprehensive information about a developer’s track record (previous and current projects) through online forums and user reviews on the website.

Nothing beats an honest review from those living in the neighbourhood. This method also gives you a quick summary of information about the history of past transaction prices, current asking sale prices as well as current asking rental prices.

Aside from that, you will also be able to get an aerial snapshot of what is available within and around the neighbourhood of the development you are considering through google maps.

Glance through the lists of existing developments in the area as well as upcoming new launches in the area, that could affect the demand and price of your selected property in the near future.

Carrying out your own independent research will help you counter-verify information provided by developers and agents, as well as highlight important concerns that you may not have thought about previously.


Carry out Multiple Site Visits

It is extremely important to ensure that you know the value of your selected property (including price per square foot – psf pricing as well as total pricing). Compare your targeted developments’ purchase price with existing properties within the area. How do these properties compare?

It is likely that there would be certain differences such as density, unit size, facilities and location, but one should weigh if or not you are comfortable paying a premium or would you rather forego the advantages for a lower price tag.

It is key to compare the new property pricing with regard to valuation and recent transacted prices of similar older properties in the vicinity as the current trend seems to indicate a growing price gap between new properties (with various discounts and easy entry schemes) as compared to a generally lower overall pricing in the sub-sale market (which may save you on lower instalments and higher rental yield if you choose to rent out your unit).

Upon researching via property listing portals, do arrange for multiple viewings in both new properties and sub-sale developments in the area to make clear comparisons.

One should also make connections with friendly and seasoned neighbourhood real estate agents to ask them intelligent questions when doing your comparative research. Making a decision is one thing, but always try to be a smart consumer by comparing and understanding exactly what you are getting into


Conclusion

“Buying a property is often the biggest and most significant purchase that one could possibly make. An industry with several property media influences such as magazines, TV programmes and websites is making it harder than ever before to have realistic expectations of what you can afford.”

Hence, although research is important – one should learn as much as possible and retrieve several opinions from seasoned individuals before making a decision with regard to property purchase, especially for first home buyers. Additionally one should be realistic with one’s expectation and budget when securing a first home.

Young buyers can always start off small and consequently upgrade their property purchases as they move up in their own businesses or in the corporate ladder. Over an extended period of time, buying a property will allow you to hedge your wealth assets against inflation thus, it can be an excellent form of savings and wealth protection. Enjoy the journey and happy hunting for your next property purchase!


This article is contributed by former REHDA Institute general manager and property investor David Shieh Chong.

David Shieh Chong is an avid property investor who manages and co-owns more than ten properties, since 2009. He is passionate about real estate and relaxes during the weekend by viewing properties and keeps abreast with the property sector.

A corporate lawyer by profession, he has experience on various aspects of real estate, including in government real estate promotion at Malaysia Property Incorporated (under Economic Planning Unit Minister), real estate agency work and also has worked with top property developers at the Real Estate and Housing Developers Association (REHDA) Institute.


Did this article help you out with reducing your property obsession? Do let us know via the comments section below!

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20150527 023646 1 small

Thanks for summarizing

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A list of to do checklist

Own dp small

That is some good deal for new property buyer..But till end of June 2019.

20150527 023646 1 small

Govt should consider extending it