My previous post A Guide To Buying A House/Property In Malaysia — Getting Started gave some tips on where to look to find property for sale in Malaysia, how to deal with agents and how to basically get the process started.
Please note the below is about buying a landed property not a condo/apartment as my experience is in looking for a landed unit.
The best advice I can give you is LOOK AT AS MANY PROPERTIES AS POSSIBLE! I honestly thought buying a house would be an easier and faster process, I was so wrong. After doing some further research I found that most sources said expect to look at close to 100 properties before you find the right one.
It’s a tough balance though as it’s a sellers market so houses get snapped up pretty fast. Once we wanted to buy, agreed with the owner, went to get the mortgage, mortgage got approved, went back to the owner…and house had already sold.
I was scared to put down the Earnest Deposit in case the mortgage got rejected. The Earnest Deposit is the amount you give to the agent or owner to ‘book’ the house you want to buy, it gives you some time to go and arrange the mortgage, lawyer and so on.
It’s usually 2-3% of the value of the house, if the property owner forfeits the sale they have to pay you back double the Earnest Deposit, and if you forfeit the sale or delay too long they keep the deposit and put the house back on the market.
Anyway, the fact is as you look at more houses you’ll start to get a much better idea of what you want (and most importantly, how much what you want costs).
We probably looked at around 40-50 properties initially in all different areas to get a good idea of the market (Menjalara, Maluri, Bandar Sri Damansara, Bandar Kinrara, Puncak Jalil, SS7, SS24 and a few more).
We almost bought the house in SS24 but got beaten by another bid, it was fully renovated, move in condition and extended to 1.5 stories. In hindsight I’m glad we got beaten to the punch as it’s a bit small for what we wanted.
We considered a unit in Bandar Kinrara 5 too as the prices there are pretty reasonable (RM325k for a double storey mid-terrace in a cul-de-sac, move in condition). But the location is too far out and the Mosque there is REALLY REALLY loud.
As you look at more properties you’ll come to see the pro’s and con’s of each unit and get a feel for the pricing. After looking at numerous properties we decided that at that time, there was nothing desirable to us in our budget. So we held off until we could afford something we really wanted, I suggest you do the same or you might end up regretting it.
Remember you’ll probably be living in this place for a good 10-15 years. These are the factors and things you have to decide to narrow down your search and start looking at the properties you really want to buy:
- First is of course budget, what is your absolute maximum?
- Area (this has many sub-considerations, more below)
- Type of house (Single Story, Double-story link, End-terrace, Corner, Super-link etc)
- Basic Unit, Basic-renovation, Full-renovation (usually includes extension, built in cabinets and kitchen)
- Basic Units also come in various conditions (move in condition, needs work..or some we saw were just plain terrible)
- Facing (North/South/East/West), does it face a junction (bad but cheaper), does it face a field (good but more expensive)
- Gated or non-gated (gated is generally more expensive of course)
- Parking/road width (this was a big consideration for us as we like to have guests)
- Lease hold vs free hold
- If it’s lease hold, how many years are left (this effects the price a lot, so think about when you are going to sell it off)
- Surroundings? (Power cables, sewage processing, petrol station – all can effect the price)
- ‘Feel’ – this is a bit subjective, but how does it feel? Is there plenty of greenery (grass/trees)? Does it feel spacious or cramped? Is it clean or dirty? Does it feel old?
- Neighbours – do they maintain their houses? Are they owners or tenants?
Most of the above will effect the price in one way or another, so your choices are closely linked to your budget. We initially wanted a house facing a field, but they are hard to find and we found the decent ones were out of our budget.
We also decided to go for a basic unit after initially considering a renovated unit because…all the renovations were hideous with flowery plastic ceilings, cheap looking wooden built in cabinets and pointless extensions. We couldn’t find a super clean, move in condition unit (apart from the one in Bandar Kinrara), but you may have better luck.
As for Area the considerations about area would be:
- Location in regards to your workplace and the roads linking the two
- General road links (we chose BSD because it’s near to NKVE/NSE, LDP, MRR2, Penchala Link and not too far from Sprint – so it’s very well connected)
- Location in regards to your friends and where you often hang out
- Amenties such as restaurants/banks/shops/doctors/dentists/mechanics etc
- How developed is it? If they are still developing there is a risk of over-population and reduction in price.
- If you have kids or are going to have kids, availability/choices of kindergartens and schools
- Sub-area (we were looking in Bandar Sri Damansara, but we specifically narrowed it down to one area which we found most desirable).
For example we ruled out SS7 because there is only 2 ‘escape routes’ – one side is LDP and one side is Federal Highway, both of which get terribly jammed. The prices were pretty cheap and big units, and even though it’s very near my office – it just wasn’t attractive.
We ruled out other units because they faced junctions, we ruled out whole areas because the roads were narrow and the houses looked old.
If you’re on a budget and want a big house with plenty of space, check out Puncak Jalil – but let me warn you..it’s pretty far away from everywhere.
When you’ve narrowed down the above you should have a very clear idea of what you want which makes it 1000% easier to actually find a unit to buy, once you’ve decided what you want drive around the area you’ve chosen every few days and look for sale signs, call the agent and arrange a viewing.
Most listed prices are open for negotiation – so don’t be shy to try and push the price down a bit. When you’ve found a unit you want, it’s a tough balance between not rushing into things and getting the earnest deposit down before someone else snaps it up.
Ironically in the end, we chose a unit that we saw very early on and decided against it. After looking at least 20-30 units in the same area (most in worst condition, for higher prices) we went back to the original unit and bought it for RM30,000 more than the original listing. Even then it was still a good deal and it’s appreciating like mad, so no regrets. It also gave us some time to get the mortgage approved and negotiate a better deal with the bank (they valued the house lower than the purchase price so we couldn’t get the loan amount we wanted, after some discussions – we got the deal we requested).
If you have any more tips/pointers about choosing a unit, please leave them in the comments below.
More about the purchase process in the next post (earnest deposit, full deposit, S+P, mortgage, lawyer and so on).
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