Did you know that buying a sub sale property costs more than just paying the down payment, mortgage and lawyers fees?
Before you venture into buying a sub sale property do ensure you have sufficient cash before you proceed.
Here’s a quick checklist:-
- 10% of the purchase value (provided that you can get a 90% loan)
- Lawyers fees and stamp duty for SNP and Memorandum of transfer
- Lawyers fees and stamp duty for the loan document (For the ones that cannot afford to buy property in cash)
- Mortgage Insurance – MRTA /MLTA ( You can request for the to be included into your loan)
- Valuation Fees
- Renovation and furnishing cost ( Sort of optional however normally there would be some costs involved regardless, even moving and throwing furniture has costs to it)
Also there are other variables in owning a home such as:-
- Utilities name transfer or set up costs
- Property assessment tax
- Quit Rent
- Maintenance Fees
- Home Insurance
An Example for a RM700,000 Home ( This is only an estimate from my own experience, the price will vary)
- Downpayment : RM70,000
- Loan & SNP ,Legal Fees, Stamp Duty : RM34,000 ( Estimated Only, depending on quotations you receive from your lawyer)
- Mortgage Insurance : Assume its included in loan ( Price varies depending on years insured and type)
- Valuation : RM1,750 (estimated)
- Furnishing : RM35,000 (Assume that 5% of home value)
It is safe to conclude that to buy a sub-sale property of RM700,000, do ensure that you have about RM140,000 in cash before embarking on this journey. Sub-sale properties may seem like a better buy at times compared to new developments under construction however , you will need to fork up a huge initial sum.