Once I have listed out all my requirements, and once I know what I should look for, for the new house .... me and my wife started to look for new housing advertisement either in the newspaper or browsing in the internet or asking around friends and relatives.
For your information, we were renting a flat in Bayan Baru, Penang, during the course of finding our dream house. I'm working in Bayan Lepas while my wife is working in Georgetown. Hence, we are looking for the location that is not far away from our work places. The places that we had in mind that we planned to look for the house were Bayan Baru itself, Batu Maung, Sungai Tiram, Gelugor, Balik Pulau, Sungai Ara. For those who lives in Penang will know these places. For the rest, all of these places are on the Penang Island. And since me and my wife are working on the island, we would like to start to find a house on the island first, so that we don't have to travel back and forth on the Penang bridge.
Bayan Baru:
There are several areas in Bayan Baru that we went to take a tour to find house for sale. We are actually looking for a landed house. In Bayan baru, there are no new landed housing development, hence we just look around fora second hand house. As Penangites knows, the house price on the island is absolutely absurd, which means too expensive.
Imagine this. For a single storey terrace house, freehold, approximately 1400-1500 squarefeet, the price is around RM430,000 to RM460,000. For a single storey terrace house, leasehold, approximately 1400-1500 squarefeet, the price is around RM300,000 to RM 330,000.
Double storeys terrace house, freehold, with approximately 1400-1600 squarefeet, the price tag is around RM520,000 to RM650,000. While double storeys terrace, leasehold with the same specifications is around RM400,000 to RM450,000.
Thursday, October 29, 2009
Hunting for the right house (Part 1)
This is when the things get really interesting and really exhausting.
I'll say that the interesting part for this stage is mainly due to the facts that I'm researching for the right house in a right place with the right price tag. It's not as easy as I have imagined it before I started looking for the right house. Probably due to the restrictions that I have.
Well, in my search for my new house, I have several limitations and requirements that need to be met. By the way, I'm a Malay, Muslim and a married man with two lovely daughters (as of writing this blog). And our family lives together with my parents-in-law. The things that I need to consider are as below:
1) Very near to a mosque (walking distance preferred), as my father-in-law will need to go for Friday's prayer each week.
2) The house needs to be very near to a Surau as well (walking distance preferred), since my father-in-law will likely be attending the prayers in the Surau .
3) Kindergarten and Primary school must be very near (walking distance preferred) for my daughters.
4) Acceptable location and traveling time to me and my wife's offices.
5) Good community, well I'm a Malay, hence I prone to live in a Malay community area.
6) Must be near to specialist hospital - for ease of traveling if my family members especially my children need to be hospitalized. (Preferably within 5-10 Km)
7) Must be near a hypermarket for groceries shopping. (Preferably within 5-10 Km)
8) Must be very near to a grocery shop for express grocery shopping if needed. (Preferably walking distance)
9) Near to highway access. (Preferably within 5 Km)
10) In a location that I can expect a good (higher is better) annual increment in the property value.
11) Last but not least .... the price must be right!
From the above reasons, you can see that almost all of the requirements relate to location. I think that is the reason all the real estate gurus said that when you want to invest in buying a property, the things that you should consider are LOCATION, LOCATION and LOCATION, everything else just doesn't matter.
I'll say that the interesting part for this stage is mainly due to the facts that I'm researching for the right house in a right place with the right price tag. It's not as easy as I have imagined it before I started looking for the right house. Probably due to the restrictions that I have.
Well, in my search for my new house, I have several limitations and requirements that need to be met. By the way, I'm a Malay, Muslim and a married man with two lovely daughters (as of writing this blog). And our family lives together with my parents-in-law. The things that I need to consider are as below:
1) Very near to a mosque (walking distance preferred), as my father-in-law will need to go for Friday's prayer each week.
2) The house needs to be very near to a Surau as well (walking distance preferred), since my father-in-law will likely be attending the prayers in the Surau .
3) Kindergarten and Primary school must be very near (walking distance preferred) for my daughters.
4) Acceptable location and traveling time to me and my wife's offices.
5) Good community, well I'm a Malay, hence I prone to live in a Malay community area.
6) Must be near to specialist hospital - for ease of traveling if my family members especially my children need to be hospitalized. (Preferably within 5-10 Km)
7) Must be near a hypermarket for groceries shopping. (Preferably within 5-10 Km)
8) Must be very near to a grocery shop for express grocery shopping if needed. (Preferably walking distance)
9) Near to highway access. (Preferably within 5 Km)
10) In a location that I can expect a good (higher is better) annual increment in the property value.
11) Last but not least .... the price must be right!
From the above reasons, you can see that almost all of the requirements relate to location. I think that is the reason all the real estate gurus said that when you want to invest in buying a property, the things that you should consider are LOCATION, LOCATION and LOCATION, everything else just doesn't matter.
Budget for the new house
The first thing that I consider when buying a house is the budget. What is the maximum price of a house that I can afford? This will need to consider all the rough estimation of the expenses that I need to produce to buy and service the house that you are interested in.
When buying a new house, the developer will request that you pay a certain amount of down payment, typically 10% of the house price. Hence, this should be your first step to measure your financial standing, whether you are able to produce the money down payment or not. You should take a look at your saving accounts, or maybe EPF/KWSP account 2 balance and figure out whether you will be able to cough up the down payment.
The second step, I then went to a couple of bank, asking the rough estimation of how much the monthly installment will be for the loan that I had in mind. Specifically the rough figure of how much of a loan that I probably need (house price - down payment).
During my visit to the bank, I also asked the officer to evaluate on how much is the maximum limit that I might possibly borrow from the bank. The bank officer requested information of my monthly and annual income, as well as my liabilities (car loan, personal loan, credit cards ... etc). From that information, the bank officer was be able to advise my borrowing maximum limit (well .... roughly of course, just for my initial kick-off for my financial analysis). And the bank officer will also be able to advise on the monthly installment for that maximum borrowing limit (based on how many years that you want to service the loans)
Based on the above information, which are:
1) The maximum loan that I can achieve;
2) My savings account balance;
3) My KWSP account 2 balance;
4) Downpayment for the house;
5) Monthly payment for house loan that I have in mind;
6) My current fix monthly commitment (car loan, scholarship loan etc)
7) My monthly spending (food, fuel, bills ... etc)
8) My monthly salary.
9) Others (savings, entertainment allocation ...etc)
I then make a simple calculations, just to have an idea to see whether with my current financial standings, what is the maximum price of a house that in my capacity to buy. If the monthly commitment is too much to bear, I then repeat the steps above for a lower house price and check again my monthly incomes and commitments. Once I obtain an estimation of how much is the maximum house price that I'm able to purchase, the next stage begins ..... which is the house hunting!!!
When buying a new house, the developer will request that you pay a certain amount of down payment, typically 10% of the house price. Hence, this should be your first step to measure your financial standing, whether you are able to produce the money down payment or not. You should take a look at your saving accounts, or maybe EPF/KWSP account 2 balance and figure out whether you will be able to cough up the down payment.
The second step, I then went to a couple of bank, asking the rough estimation of how much the monthly installment will be for the loan that I had in mind. Specifically the rough figure of how much of a loan that I probably need (house price - down payment).
During my visit to the bank, I also asked the officer to evaluate on how much is the maximum limit that I might possibly borrow from the bank. The bank officer requested information of my monthly and annual income, as well as my liabilities (car loan, personal loan, credit cards ... etc). From that information, the bank officer was be able to advise my borrowing maximum limit (well .... roughly of course, just for my initial kick-off for my financial analysis). And the bank officer will also be able to advise on the monthly installment for that maximum borrowing limit (based on how many years that you want to service the loans)
Based on the above information, which are:
1) The maximum loan that I can achieve;
2) My savings account balance;
3) My KWSP account 2 balance;
4) Downpayment for the house;
5) Monthly payment for house loan that I have in mind;
6) My current fix monthly commitment (car loan, scholarship loan etc)
7) My monthly spending (food, fuel, bills ... etc)
8) My monthly salary.
9) Others (savings, entertainment allocation ...etc)
I then make a simple calculations, just to have an idea to see whether with my current financial standings, what is the maximum price of a house that in my capacity to buy. If the monthly commitment is too much to bear, I then repeat the steps above for a lower house price and check again my monthly incomes and commitments. Once I obtain an estimation of how much is the maximum house price that I'm able to purchase, the next stage begins ..... which is the house hunting!!!
Introduction
I would like to share my experience in buying a real estate properties in Malaysia. I'm a Malaysian and this is the first time that I bought a new house. I reckon, if I write all the steps and experiences that I went through from start until I move into my new house, it can help other fellow Malaysian and me as well, if I were to buy another house in the future. This can serves as a references on what needs to be done, what are the important things that I need to make note of and so on and so forth.
Well, I hope this writing can be useful to other Malaysian house buyer. I hope you'll have a good time reading my blog.
Well, I hope this writing can be useful to other Malaysian house buyer. I hope you'll have a good time reading my blog.
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