[Part 2] My First Property: The Journey, Surprises, Decisions

If you haven’t read part 1, go read it now https://keflah.com/investment/property/part-1-my-first-property-the-journey-surprises-decisions/

On my previous post, I’ve mentioned that I went through severals property platform. At one time, I did reconsidered the unit one from Rawang. It’s a Leasehold but it’s cheaper than any properties that I found in Petaling Jaya. And Leasehold might be the future trend for Landed property in Selangor. Who knows? But then I think again, the distance, it’s 40km away from my workplace. I’ve calculated that it will cost me time and money. And my company won’t allowed to work remotely. So again, it’s a No-Go.

I have fine tuned the things I should look for before buying a property; it must be within 20km radius away from my work. It MUST be Freehold. And lastly, it can be a condo (as an option). In all honesty, I would never consider a condominium because I had this kind of mindset that my sister and her husband got their own landed property and my parents had their own landed property, so I should get myself a landed property as well. The thing is, they Shared using both of their Name because they are married couple. And in reality when it comes to Selangor, especially Klang Valley where its a hotspot for businesses, properties are very expensive. Cheap landed properties starting price from RM700,000! And even if I could afford it, it would squeeze every penny I have and I would probably will not having any savings for a few years! I got no choice but to consider condominium as well.

As I went through listing for hours, I noticed there’s a pattern that sounds a bit fishy. First home buyer should take note this; example, If the a listing shows a 1100psf unit priced between 300k-420k and it is close to your work, for you, it will sound very alluring (even for me!) but when you put your email or contact number in hope someone would contact you… no one contacted you even a months later! Because these kind of scam just want your Name, Email and Phone Number and they will send you messages through SMS or Whatsapp for promotional purposes.

I am not that First Home Buyer that took their sweet time when buying a house. I felt that I need to hurry because I feel the price would go up again next year! So I select 12 listing, submit my name, my email and my phone number.  A day later, out of 12, only 6 agents contacted me back. So I asked them a questions.

These are the questions that I asked in no particular order:

1. Is the unit still available?
2. Is it Freehold or Leasehold?
3. How much is the price? And how much will the monthly be?
4. Do I need to put 10% deposit? Any rebate?
5. Is it under commercial title or residential title? If commercial, can we convert it to residential title? *This is so we can get residential rates for electricity and water bill.
6. How big is the size?
7. Is this a Condominium or Serviced Apartment (also known as Serviced Residence to make it sound cooler)
8. What is the developer name? And what is the name of the project?
9. If it is under-construction, what is the estimate year for it to complete?
10. Where is the location?

Some of these questions are not necessary because it was included in the listing. But some agents (either intentionally or non-intentionally) did not put enough information before publishing it, so I need to ask question to know more. If it is a Leasehold, the agent would probably not include in their listing (and Facebook post). And if the developer already got a bad history from their past project, it won’t be stated in their listing as well. So, out of 6 agents, I contacted one person and arrange a meeting with her. She (Ann) is not an agent but a Sales Advisor.

I met Ann around 8:30pm at her office (property developer office, mind you). She showed me the models and explained the concept, what comes with the unit, how many floors are there, how many blocks, the type, the size of the unit and the “freebies”. The concept inspired from Japanese house that utilise small spaces.

There are 2 blocks; block A and block B. There are 3 different type of sizes, only the smallest size has a different layout. The office also has a showroom inside it, but it followed the large size (around 1000 psf) layout. I was concerned if this property had any potential for investment and I start question her. She explained that the developer are planning to build a bridge that would connect to the other side which make easy access to a mall which could potentially increase the property value in the future.

After an hour of hanging around the showroom, looking at the model, I chose a smaller size instead since I am buying this for  own stay and an investment. And because I chose a unit at a higher floor and on this block, the unit will include a 2 1hp air conditioner, a shower heater, a cooker hub and hood, a dining table and a kitchen cabinet. Each buyer will be given a free 2 carpark. Sounds really really good. I really want this unit.

I asked her if I need to pay other fees that I’m not aware of. The answer is that I do still need to pay stamp duty fee and I need to pay Memorandum of Transfer (MOT) but I did not know MOT at all at that time. Knowing that I need to pay MOT, I decided to head back home and take my time to educate myself. I now know MOT is a process for transfer of ownership, meaning the unit I am about to purchase is currently under Master Title, for it to be mine, I need to sign a memorandum of transfer agreement and then the unit will be under Strata Title. How MOT is calculated:

Source: https://www.hba.org.my/articles/iprop/transfer.htm
Calculator: https://www.jpph.gov.my/V2/kira_dutisetem.php?versi=1

The next day, I had placed a booking to secure my unit and I can only hold onto it for 30 days. And within a week, I calculated my expenses including the estimate mortgage, maintenance fees, bills and loans. It was devastated that I can only save this much. There was even a time I want to cancel and get my deposit back. BUT there wasn’t any property that could provide the sense of exclusivity as this. A week full of stress and it affected my work. So I decided to ask her again that I want to do a site visit and she arranged it for me. Because I only know how the large size layout would look like, but I don’t know how the smallest size layout would look like.

Upon arriving the place, I saw the building, under construction. Before entering, we both were given a helmet for safety measure. The Supervisor bring us to a complete unit at on the lower floor. The hallway with lights turned on was beautiful. And after entering the unit, I finally get to see how my unit shall look like. I did not expect it to be good because I’ have been to the showroom but never to an actual unit, let alone unit following the unit I’ve just booked. Took some photos and video and in the end, I am happy with the layout. It may be small but when I think about it, the less effort I need to put on cleaning and less assessment tax I need to pay each year.

At the end of our site visiting, I told Ann I hadn’t fully confirm on the unit yet and I will get back to her in another day because I don’t want to sound like I’m rushing. I calculate my expenses again but this time, I change it a bit with idea that I need to change my lifestyle. Instead of buying foods outside everyday, I want to cook. Yes, and it make a whole lot of sense now, why I did not think of that? The results, I can save(in addition) up to RM350 if I cook from home only. But hey, I think RM200 is more realistic as I don’t think I’ll be cooking all the time. And I did calculate on how much I do need to save for MOT, renovation and furnishing.

2 days after our site visits, I contacted her that I agree to buy the unit and requested her arrange for meet up with the lawyers. The next day at night, I met with the lawyers and a bank officer. The lawyers handles the sales & agreement and loan legal stuff (I think).  I went through the documents! But there were 12 documents in total that I need to sign with my signatures. Not only that, I need to sign my initials in every pages! My hand was tiring in the end. The fun hasn’t stop yet because I still need to sign Loan Agreement provided by the bank officer. He explained to me that I need to pay progressive interest after 3-4 months after signing. The whole process took me 4 hours to complete! What a day!

Arrived at my room, I showed a sign of relief and went pay off Stamp Duty Fees and Loan Disbursement Fees that midnight through online banking. And suddenly those heavy feeling on my shoulders felt it got lifted for good. I wasn’t stress at work and I was happy that I finally felt like I got my own home, my own asset and it was the biggest decision I made that can change my life and I hope it’s for the better. And the booking fee I made, they will refund it when I get a copy of my Sales & Purchase agreement. Neat.

It is estimated to complete between August-September 2019.

In Conclusion

I have learned a lot during this journey. From a person who was ignorant about property to a person who gained knowledge about property. From a person who only hadn’t had an asset yet to someone who has it now. I’ve been caught off guard so many times and surprised that I need to pay more stuff. But in the end, I did it.