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How to Buy a House in Malaysia?

For most people, the first taste of one's very own hard-earned income is indeed liberating. So, what comes next after being handed your first set of car keys? We certainly hope that your next goal would be to get another set of keys; one that opens the door to your very first own home!

 

Here's an abbreviated look at your possible path and checklist towards owning your first property.

INVEST IN YOURSELF FIRSTTake a little time to meet and learn from experts, fellow investors and homebuyers.
KNOW AVERAGE PRICESHouse prices in Kuala Lumpur are the costliest in Malaysia with an average price of RM497,535. This is followed by Sabah and Selangor, where average prices range between RM372,499 and RM382,414, respectively.
BREAKDOWN OF EXPENDITUREMost financial experts recommend that you allocate no more than one-third of your total income to pay off your home loan. Mortgage repayment should not exceed 28% of monthly income. Total monthly bills should not exceed 36% of monthly income.
HOW MUCH CAN YOU AFFORD?Take a hard look at what you are spending your money on and decide on a budget. The rule of thumb is to look for properties that are three times your annual income.
DO YOU HAVE ENOUGH FOR DOWN PAYMENT?For your first home, you need to put a down payment of 10% of your intended property's price. In Malaysia, most banks offer up to 90% of the property's price (margin of financing) for your first two residential properties.

DETERMINE THE TYPE OF HOMEWhat shall it be? Condominium, apartment, terrace house, semi-detached house or bungalow? See home types here.

HOME LOAN INTEREST RATESThe interest that banks charge will be determined by the Base Lending Rate (BLR) set by Bank Negara Malaysia (BNM). The current BLR is 6.6%. So, if a bank advertises their home loan interest rate as BLR -2.20%, then the interest rate for your home loan will be 4.40%.
LOOK INTO FIRST-TIME HOMEBUYER SCHEMESCheck if you fit the criteria for My First Home Scheme or 1Malaysia Housing Programme (PR1MA).

ENGAGE A REAL ESTATE AGENTTell them your requirements such as preferred locations, home type, unit size, loan tenure, land tenure and estimated budget.

Start here! Be sure to know what you want as this is a high-involvement product that you will call your own for years to come. Inspect the properties as thoroughly as you can.
3 WAYS TO LOWER YOUR MONTHLY INSTALLMENT1. Place a bigger down payment. more than the required 10%.
2.Search for the lowest interest rate and packages. where some fees are absorbed by the bank or developer
3.Request for a longer loan period.
GET A BANK LOANResearch the current packages and go for one that best suits your repayment profile. Visit your selected bank and apply for a housing loan.
MAKE AN OFFERYou've found it! Once you and the seller have agreed on a purchase price, you will need to sign a standard document and pay the 2% earnest deposit.
ADDITIONAL COSTSApart from the down payment of 10%, there are other costs such as legal fees, 6% government service tax to be charged on the real estate agent's commission, stamp duty, and so on.
CLOSING THE DEALOnce all the paperwork has been completed properly by your lawyer, you can make arrangements with the seller to get the keys to the property.

RENOVATE & CLEAN-UPMeet your contractors and interior designer, and submit your renovation plans.
Check out our home services link here!

MOVE IN!Pack up your stuff, move in and begin planning for a housewarming party!
* All data and information is correct at time of upload. These articles are for information and basic educational purposes only.
Consumer experiences may differ depending on location or other factors.
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