Don't Buy... Yet! 12 Secrets You Need to Know Before Buying a House
Are you looking for the right opportunity for property investment in Malaysia? Would you consider yourself in the category of "first-time homebuyers"? If so, then you need to educate yourself on what to know before you buy a house.
There's a lot to consider, such as the mortgage, the house itself, interior design, and so much more. The more well-informed you are going into your search, the better result you'll have when shopping around for a Malaysian house to buy.
Be sure to see below for several house buying secrets that you should consider as you begin your search. You'll be happy that you did!
1. Search for Sustainability
Malaysia is at the forefront of finding sustainable living situations for all of its residents. Because of that, it would be advantageous if you invest in something that fits that category.
Doing so will put your home in high demand as more buyers become interested in searching for an environmentally-friendly housing situation.
2. Consider the Mortgage
For you to be entirely comfortable and confident with your purchase, you want to make sure that you've found something in your price range.
Otherwise, you might be putting yourself in a tricky situation down the line. Be sure to use our loan calculator to figure out how much you need, what you can afford, and so on.
3. Location Doesn't Mean Distance
Did you know that Malaysia's population has grown to more than 10 times over in the past century? It's become one of the most densely populated areas in the entire world.
For that reason, you need to remember that "location" isn't the same thing as "distance". Always consider the travel time between the home you're looking at and the places you'll be visiting the most. Otherwise, you could be committing yourself to traffic jams for the rest of your life.
4. Consider the Value of the Property
Discounts and offers aren't the only things that matter in home buying. Too many people use them as the primary indicator in what real estate to invest in.
However, it's the value of the home that you want to zero-in on. Consider the discounts to be the "cherry on top", if applicable. Discounts and offers don't give you long-term value.
5. Always Look for Signs of Future Development
The objective of buying real estate isn't just to purchase yourself a home. It's to invest in a property that could give you a better payout in the long-term.
6. Create a Budget
As previously mentioned, you don't want to invest in a mortgage that requires too much of your monthly take home pay. In fact, you don't want to invest any more than 30-percent of your pay. It's always a great idea to spend some time creating a budget before you start your search. That way, you have more confidence and accountability while you search for your next property.
7. Look for Average Prices (Specific to the Area)
It's important to know the average pricing of houses when looking at a general area in Malaysia. This will help you figure out which locations you should focus more on and which ones are typically going to be outside your desired price range. There are a few sites that you can use to calculate the past 10 purchases of homes in that area and average them up to see what you should expect to pay.
8. Ignore Market Rumours
Everyone is willing to give you their two cents if you allow them to. However, listening to every piece of advice you get when searching for Malaysia real estate is unwise.
Doing so can lead you in the wrong direction. Stick to listening to reliable real estate agents and other experts in the real estate field. Even if your best friend just purchased a Malaysian home for themselves, take their advice with a grain of salt.
9. Always Assess the Risks
Spoiler alert: every piece of real estate that you'll ever look at has certain risks attached to it. There's no such thing as "perfect real estate". However, a "perfect fit" would be a piece of Malaysian real estate that's in your price range and has minimal risks attached to it.
No matter what property you're considering, look at the risks. What are the long-term ramifications of this purchase? If you plan to rent it out, how much can you charge for that area? Are there any pressing repairs that need to be done?
10. Get Mentally Prepared
Investing in real estate isn't for the faint of heart. Whether you plan to live in the house yourself or rent it out to tenants, there is an immense amount of responsibility attached.
Stick to the 30-per cent rule that was mentioned earlier. Don't invest in anything that's going to put you higher than a 30-per cent debt-to-income ratio.
11. Know the Rules of Foreign Investors
Malaysia is much more welcoming of foreign investors than many other countries, but they aren't without their rules. The two biggest rules are :
1) never buy land that is Malay-reserved;
2) there is a minimum investment of over RM1 million.
Does that fit your budget? Are you willing to make that investment? Speak with your trusted real estate agent for further direction.
12. Always Consider the Down Payment
Remember, this is an investment. Therefore, you want to make sure that you're setting yourself and your family up for success down the line. A key part of that is making a sizeable down payment to lower your monthly mortgage. You generally want to place a down payment that is at least 10-per cent of the total price for the home.
Use These Property Investment Tips to Your Advantage
Whether you're a foreign investor or a native Malaysian that's looking for a property investment opportunity, be sure to use these tips to your advantage. Be sure to read this article for more information on the Seri Pajam Knowledge Castle and what all that entails.
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