No matter what stage of life you’re at, you’re sure to buy a property at least once in your lifetime, or you know someone close to you who has bought one. It doesn’t matter if it’s as an investment or to live in until you’re old and grey – owning a property is pretty priceless!
If you’re looking to buy a subsale house or a new home soon, here’s a quick guide on the process of buying a house in Malaysia.
7 Simple Steps To Buy A House In Malaysia
Whether you’re buying an apartment in Kepong or a three-storey house in Cheras, the first steps to buying a house are:
1. Identify your why
The most important question is “Why are you buying the property?” because it determines the type of home, the property price you can afford, and more. Think of the purpose of the property as well: are you buying it to live in it, for your parents, or as a valuable investment?
2. Calculate your budget
Once you have identified your why, the next step is to calculate the property price you can afford. It should be based on your net income and affects the type of property you can buy and its location.
When compiling your budget, include predictions for your monthly mortgage (use the Mudah.my home loan calculator to help you calculate it), the cost of buying a house (stamp duty, legal fees, etc.), loan interest rates, mortgage insurance costs, etc. After all, you wouldn’t want to eat instant noodles daily in an empty home.
3. What kind of house and where?
The house you buy and where is subject to why you want to buy a home, plus your budget. Are you looking for a freehold or leasehold property? How about a home from the primary or secondary property market? A terrace home in Jelutong or a condominium in Johor Bahru?
If you plan to have children or pets in the future, you need more space to accommodate your growing family. Can they all fit in a city home or a well-planned urban township? Once you have all the answers and found the ideal home, look for a reliable property agent to help you buy it.
4. Check your mortgage loan eligibility
You decided on a house that’s an absolute steal, but before that, check your eligibility for a mortgage loan. The bank needs to know your credit score to confirm you can repay the loan on time and not default.
If you’re worried about your credit score, you can get a CCRIS or CTOS credit report to gauge your eligibility better. You can also calculate your Debt Service Ratio (DSR) in advance to see if it’s within healthy borrowing limits. These will help you estimate if banks will be willing to give you the loan and if not, what you can do to improve your credit score.
5. Sign the documents and make it official
Once your mortgage loan is approved, make it officially yours by signing the necessary paperwork! If it’s a strata-titled or non-strata-titled home or even a subsale home, the sale of the property will require different documents.
The most significant documents when buying a house are the Sale and Purchase Agreement (SPA), Loan Agreement (LA), and the Memorandum of Transfer (MOT) or Deed of Assignment (DOA). Make sure you fully understand and agree to the terms before signing, as any cancellations can cause a penalty.
6. Pay the necessary fees and costs
Once you sign the paperwork, it’s also time to complete your first responsibility as a new homeowner: paying the fees and costs. These include the 10% downpayment for your home, stamp duty fees, legal fees, property taxes, agent fees, and any others that incur.
If this is your first home, see if you are eligible for any first-time home buyer exemptions as they can help you save money! The exemptions can be initiated by the government or the developer (if you are buying a new project), so research your first time homeowner benefits wisely.
7. Receive the keys to your home
After paying, the final step is to get the keys to your home. As subsale homes already exist, the keys are usually handed over within six months from the date the SPA is signed.
On the other hand, new homes are built from scratch and takes roughly 24-36 months from the date of the SPA signing for homeowners to receive the notice of Vacant Possession and their keys.
Buy A House And Make It A Home
Depending on a new or subsale home or an auction property, there may be slight differences in the paperwork required. Nevertheless, those are the basic steps to buy a house in Malaysia, be it a landed or high-rise home!
Once you receive the keys and complete the defect checks, turn your house into a home by furnishing it into the house of your dreams. Fill it with the things you love and the people you love, and call it your home sweet home.