When it comes to properties for sale in Malaysia, the property market is made up of the primary and secondary property markets.
The primary market consists of new properties sold by developers straight to the buyer. These are new projects where you can buy the property before it’s developed, and you’re the first owner of the unit.
On the other hand, the secondary market consists of existing properties sold by the owners who live there or own it. As you are buying the house from the current owner, you won’t be the first owner, but a subsale property comes with a wealth of benefits, like a mature location!
Besides living in a highly-strategic area, a subsale house lets you get to know your neighbourhood (and neighbours) better firsthand. You’ll also get to see the property before you buy to plan any expansions or renovations needed.
Above everything else, the best part is that subsale homes already exist, meaning you can sign the paperwork and probably move in faster than buying a newly built home. All you need is to do some renovation or touch-ups (if needed) and move your luggage and family in.
If a subsale is on your mind subconsciously, here are some quick steps to buy a subsale house in Malaysia.
7 Steps To Buy A Subsale House
1. Financials first: Calculate your budget
There are many things to consider when budgeting: the Sale and Purchase Agreement (SPA), stamp duties, legal fees, agent or lawyer fees, loan interest rates, mortgage insurance, property taxes, etc. To start off, calculate your monthly mortgage payment using the Mudah.my home loan calculator to see if you can afford the repayment.
Besides that, remember that a subsale house already exists and probably has for a long time. Therefore, you’ll need some work and money to refresh the place depending on its condition. This can range from extensive repairs and construction to only a repaint or a new set of locks.
2. Compare similar properties and locations
Now that you have a rough idea of an affordable and comfortable monthly repayment, look for properties within that budget. Shortlist a few locations and properties that tick the boxes, and visit them to see for yourself.
When viewing, inspect the property to ensure it’s safe and move-in ready. You can also survey the surrounding amenities like schools, malls, restaurants, supermarkets, places of worship, and more. Once you find your ideal home, enlist a reliable property agent and lawyer to help with buying the house!
3. Apply for a mortgage loan
Unless you scurried away some cold hard cash in kuih kapit tins in your cupboard, you will need a mortgage loan to buy a property. For your first home, the maximum eligibility amount is 90% of the loan, while the remaining 10% is your upfront downpayment.
Whether or not you get approved for your mortgage loan depends on your Debt Service Ratio (DSR) and CTOS/CCRIS. You can also compare interest rates from different banks to see which provides better value and serves your needs.
4. Prepare the SPA and Inventory List
Every property purchase, new or old, involves a Sale and Purchase Agreement (SPA). The document details everything related to the sale of the property, such as the location, built-up, land size, unit number, and for subsale homes, any fixtures or items that may remain in the house.
Existing items or furniture to ‘inherit’ will be compiled into an Inventory List for you to receive during the Vacant Possession (VP) of the property. If the house is sold as fully furnished, but when you move in there’s not even a single chair, your SPA is a fail-safe to help take action against the seller.
5. Complete the Loan Agreement and Memorandum of Transfer (MOT)
Once you receive the good news of your home loan approval, it’s time to sign the official Loan Agreement. The agreement contains the basic details of your home loan – the loan amount, tenure, interest rates, and other crucial T&Cs to know.
Besides that, the Memorandum of Transfer is an official document to transfer the ownership title of the property from the seller to you. If you don’t have and sign this, the property will technically still belong to whoever’s name is on the land title (the current owner).
6. Wait for the Vacant Possession (VP) and Agreed Apportionments
After the paperwork has been signed, sealed, delivered, processed, and approved, you can anticipate the Vacant Possession (VP) period to receive the keys! The VP typically happens a few months after the SPA signing to give both parties time to settle existing property matters.
During the VP, you will need to pay off the Agreed Apportionments. This document details any bills already paid for by the previous owner, such as maintenance fees and water bills. As the new and rightful owner of the property, you must reimburse the amount to the seller as it is no longer their home, and they won’t use it or the facilities.
7. Update your utilities and tax particulars
Finally, complete the purchase of the house by updating the details of your utility bills and any tax particulars. These include your electricity bill, water bill, maintenance fees, cukai pintu, and cukai tanah so you can receive the correct bills and rates when the time comes!
Again, it’s worth repeating that if the previous owner has prepaid any bills, do your due diligence and responsibility to return the payment to them and avoid any incidents.
Subsale Homes, Maximum Value
Whether it’s a new house, subsale, or even auction property, a home is still a home to provide a roof over your head and keep you warm and safe.
Not sure if a subsale or new house is the ideal property for you? Consider these questions:
- Where are the locations you would like to live in, and what is the type of property?
- What is the complete budget you can allocate for your house?
- How long can you wait to move in?
If you have all the answers in your head and they point to the one, don’t waste time and start your house hunt now! Find a home for sale, fill it with love, and let it be your safest space in the world.