Work Out Your Budget
There’s no point in diving into a home search without first knowing what you’re looking for, and when it comes down to it, that begins with your budget.
We've got a range of great tools to help you work out your financing:
PropertyGuru Loan Pre-Approval – assess your chance of home loan approval (for free!) with a 99.9% accuracy.
Affordability Calculator – a very basic guideline on how much you might be able to borrow.
Mortgage Repayment Calculator – a simple indicator of your monthly home loan repayments.
Of course you have to take into consideration your downpayment needs in your overall financing. That’s a lump sum equal to 10% of the total cost of the property that you'll need to have saved up, in order to pay upfront.
Remember to also take into account additional costs, such as stamp duty and other miscellaneous legal fees. These can sometimes be overlooked by eager new buyers (by accident, of course).
But finding out you’ve got just enough money for a new home's downpayment, then realising you’re RM5,000 short because you forgot to factor in the other legal costs can be a real kick in the dreams!
Find Your New Property
This is the exciting bit when it comes to getting the best home for you! Luckily for you, we've got tens of thousands of new homes with great potential for you to search through
Whether you’re after a posh luxury bungalow with a helipad in the garden, or a comfortably affordable apartment with great shared facilities, the one important factor to remember: LOCATION!
There are also a range of other factors which impact property value in Malaysia, so it’s important to have a list of what's most important to you during your search.
This is also where you'd probably want to bring in a real estate agent. These experienced professionals know the markets, know the reputation of developers, and know how to navigate the tricky waters of legal paperwork.
They can be a huge help in directing your efforts, informing you of how to get the best deal, and generally being the champion you need.
It really should go without saying, but don’t forget to get as much information as possible on the property.
Crucially, this is also a good time to ask developer's agent important questions, such as the condition of the property, neighbourhood, and appliances included, to name a few.
Letter Of Offer/Intent To Purchase
If you’ve found your dream new house, you need to make sure you let the developer know. That’s where the Letter of Intent to Purchase comes in.
The Letter of Intent to Purchase is a document which states your intention to purchase a particular property.
It’s generally combined with an earnest deposit, which is an upfront payment for 2% of the total cost of the property. That 2% also counts towards your overall 10% downpayment requirements.
The Letter of Intent to Purchase sets out the initial conditions of offer and purchase. That includes things like whether you get a return on your earnest deposit if, for whatever reason, the sale falls through.
It also sets out the date by which the Sales and Purchase Agreement (SPA) should be signed, usually within 2-3 weeks of the signing of the Letter of Intent.
Sign The SPA
This whole thing is rolling along nicely! You’ve got your dream house picked, your financing is on the path to being sorted, and you’ve laid out your intentions clearly. Next up, signing the Sales and Purchase Agreement (SPA).
The SPA is an incredibly important legal document which sets out the full terms and conditions of your purchase. This is exactly why you got a lawyer involved in the first place.
Some developers may offer a free SPA drafting service as a perk, but remember that the lawyer in question is ultimately working with the best interests of the developer in mind.
While a top developer is unlikely to sneak in some sinister clause that means you owe them your first-born to get access to the swimming pool, it’s always good to get your own legal professional to look over the details first.
The fine print of the SPA is a crucial part of getting the right deal on your new property. Saving RM1,000 on a nifty developer rebate only to find out you can’t access any of the exclusive shared facilities would really undermine the value of that purchase.
Sign Loan Agreement And MOT
Unless something has gone horribly wrong, you should have some confirmed home loan offers on the table at this point. It’s now up to you to confirm this offer by signing the Loan Agreement.
This is a legal document which sets out the terms and conditions of your home loan. Although they’re largely influenced by standard procedures from the bank, it’s still a good idea to have your lawyer take a look over it if you can.
This is also where you’ll sign your Memorandum of Transfer. This is the legal document which transfers ownership in the case of properties with either a Strata Title or an Individual Title.
If you’re buying a stratified property as part of a larger development, it might be the case that you’ll sign a Deed of Assignment instead, which conveys ownership of property which is still under a Master Title.
Pay Fees And Costs
Here comes the big money bit! You’ve got to hand over your hard-earned cash. Once the SPA is signed on the dotted line, you’ll need to pay the remaining share of your 10% downpayment, and ensure your home loan payment is transferred.
Of course it’s not just those big ticket payments that you have to make. You’ll also have to cover all the relevant stamping fees and legal fees required.
It might hurt a little bit watching all that money roll out of your accounts, but remember that you get an awesome new property at the end! Whether that’s an investment property, or your very first home, that’s an exciting proposition all around.
Receive Vacant Possession
It’s time to receive your Vacant Possession! You did it! This is the part where a house now becomes a home.
The Notice of Vacant Possession must be completed within 36 months of signing the SPA for a strata-titled property, and within 24 months for an individually-titled property.
Getting the right deal on a new property doesn’t stop once you’ve handed over the money. Even top developers can sometimes miss little faults or problems in a property.
It’s up to you to ensure you get the most for your money by performing a detailed check and reporting on any defects or issues, because guess what?
Your brand new property actually comes with a warranty against defects after you've received the keys to your new home!
That's right, it's the defect liability period, where the developer is bound by law to repair any faulty workmanship discovered, but at no cost to the buyer..
The Notice of Vacant Possession precedes receiving your Certificate of Completion and Compliance (CCC).
This is a legally required document issued by the local authority to say your new property is safe and fit for human habitation.