For quite some time, the Malaysian housing market has been going through periods of irrational exuberance, until now. The typical home buyer was an individual that wanted to purchase a house to call his or her own, but a large proportion of purchasers got into the transactions with the aim of purchasing additional properties for investment purposes. However, the economic circumstances have changed, and people are now more aware of them.
Before plunging into the real estate world, it is pertinent that you first understand your own finances and market conditions. You should also carry out research to find the best mortgage lenders on the market for the best deals. Remember to also read the fine print before you sign any type of agreement. A wise house buyer is one who always checks on his or her debt levels, and is constantly on the lookout for effective means of reducing these debts.
Purchasing a house that you cannot afford is akin to eating more food than you can possibly digest. Therefore, inspect your financial and lifestyle capabilities carefully. Have a plan in place for instances when an unfortunate incident occurs, like the loss of your employment position, illness, or even death. At the same time, ensure you have enough financial strength to push any road blocks that may come up and move on. Unfortunately, banks do not have the time to listen to tearful stories. All they’ll want is their money back.
Consequently, visualize and think long term, and ensure that your bank card has enough back-up to see you through this long, strenuous journey of almost 25 years. You can also look through PropertyGuru for a house for sale in Malaysia that suits your financial situation.
The Market Conditions
Considering that purchasing a house for sale is likely to be one of the biggest investments you make, you have to take time and study the real estate market to understand the existing conditions. The property sector is by far one of the worst hit by any current economic hiccups. Things can easily get worse considering that the demand for commercial and residential houses can stagnate, in addition to the fact that land values soften and that there are always unpredictable interest rates. According to a Bank Negara Malaysia (BNM) statement, measures were put in place to restrict access to capital in an effort to control rising debt. Back then, the real estate market was experiencing great pressure and underperforming as reflected in the stock market.
Be Wary of Banks
In today’s highly competitive financial markets environment, banks are offering home loans under different conditions. In general, banks are offering loans or deals based on the borrower’s credit profile. Patiently check the conditions. Understand those hidden trigger points that are likely to see you lose your home. While you are collecting all the positives of owning your own home, you should also familiarize yourself about the negatives so that when you choose a loan, you will discipline yourself to meet as well as resolve any issues that are likely to pop up later.
Grasp the Fine Print
The fine print area is usually where all your problems will be hiding. Many would-be homeowners choose to shut their eyes and sign the dotted line. They forget to find and read clauses in fine print in the loan document. You have to carefully read and understand how each clause is likely to affect you. Consider hiring an attorney to take you through each of the loan agreement document to ensure that you do not find your self in a financial black hole down the line.
Watch Your Debt Levels
If you have managed to accumulate other savings on top of those stated by the Malaysian Employees Provident Fund (EPF), you are well on your way to financial freedom. The next logical course of action is channeling the extra savings towards payment for a new place to live in. The real estate market has an appetite for cash, and this will enable you to negotiate better deals in a weak market. Next, if you have extra income from a salary rise or bonuses, try pre-paying. This will help ensure that your debts are not more than 15 percent of the total purchase price. This will not help reduce tenure, but will help save on interest.
Stay Focused When Looking at a House
If you will not be working towards owning a home through a real-estate agent, you will find yourself dealing directly with the owner. This means that the owner gives you the guided tour. Since the owner is emotionally invested in the property and its looks, it can make any potential buyer uncomfortable. This then means that you will not be in a position to critically and closely look at the property with the owner watching your every step. However, if you are serious about purchasing a property, homebuyers should not hesitate opening cabinets, looking inside closets and carefully inspecting every part of the property.
In the stock market, price fluctuations occur every minute, which can be exciting for stockbrokers. However, in the real estate market, the process is much slower but can stay in a stable position for a longer time. This will make it relatively easier for you to take your time to thoroughly check all your options.
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