Hi,

Anyone who had experience in buying land? Mind to share how?

I have a lot of questions about buying a land:
1. What is the minimum down payment?
2. I assume loan interest rate is still base on BLR, right?
3. I see there are several type of lands for sale: Residential, Commercial, Industrial and Agricultral. Can I make use of the Residential Land to build car park?
4. I see some advertisement stating about "Bungalow Land", does that mean only Bungalow can be built on that piece of land? How bout building terrace house there?

Thanks.

1. Depends on how much the bank force sell value is. If the land owner wants to sell his land for RM 1mil. And you are interested to buy. The bank force sell value is RM 800k. And normally the bank only finance 60-70% (lets us assume 70%) of the land value (depends on your land valuation). That means the bank can only loan you RM560k, and you have to come up the rest with cash.

2. No. It depends on what you are going to do with the land. If you are going to plant oil palm on the land, the interest is around 10%. If you are going to plant vegetables on the land, then the interest is around 4%.

3. Yes you can, if the town planning dept. approve your conversion of residential land to commercial usage. Car park is under commercial usage.

4. The land that you see are before a big piece of land lets say 1 acre. Then the land owner subdivide the land into 4 pieces with each land 1/4 acres. Then he sold it for a premium price whereby the price is most reasonably build for bungalow.

Can you imagine a 1/4 acre land selling RM 500k, and use to build terrace house?

A rules of thumb for 1 acre land builds around 8 terrace house. 1/4 acre? Build around 2 terrace house? A terrace house with land cost RM 250k, how much would your construction cost be? How much can the general joe&jane afford for a terrace house?

Hai:

May i know what bank offer loan for buying palm oil land?

The interest rate is same as OD rate? How long the maximum loan term?

eric

Why the interest rate for oil palm land and vegetables land interest varies so much?

I do not have the latest interest rate. Last I heard from my friends who take loan, the interest is as high as 10%+.

It is because oil palm yield more earning than vegetables, a hell lot more.

My opinion slightly differs. But let's discuss.

1. Actually banks normally uses OMV (open market value) rather than FSV. It really depends on the class of land. If it is bungalow land, then the LTV would be higher. But if it is unplanted agricultural land, you will be lucky if you get LTV 50%.

2. The most expensive loan I have for my palm oil is at BLR+2.5% (Maybank). The lowest is BLR+0% (XXX Bank). For other government approved agricultural scheme, the rates are quite special. Like the 4% one you have quoted. In fact for some palm oil, if you are a small holder, you might be eligible for the scheme, especially if it is for replanting or some capital.

3. Agree with you on this one but if the car park is not for commercial purposes (ie. you are not collecting money for it), then I believe no one will kacau you if you level up the place.

4. Actually 1 acre can build more than 8 terrace houses. If a terrace house is around 20x70, then your area would be 1,400 sq ft. You can build more than 20 terrace houses in 1 acre depending on your town planner.

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Added on March 14, 2011, 2:55 pmAt current BLR, if your friend interests is as high as 10%+, it would probably mean he has a vacant land, yet to be planted and in the middle of some virgin jungle. These are reasonably high risks and hence the high interests rate.

I don't think the interest rate is dictate by the profitability of a plant. It is just different loan scheme the government has. Eg. for SME, there are SMIDEC loans. These are very low interests loan.

This post has been edited by michaellee: Mar 14 2011, 02:55 PM

Anyone can share the loan to buy agriculture land with or without palm oil.. How many years of loan tenure? How much can loan up to?

Anyone took land loan from agriculture?

eric

What about land with mineral?

cyrus you got land with minerals for sale?

Agribank.

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Added on March 15, 2011, 2:10 amLoan from bank of course you need collateral, say "fully paid house".
Unlike houses, land normally not accepted as collateral, sebab susah jual.

Ask the loan department for details.

As usual, you got to prove that you are able to pay back, then bank will lend to you.
Proven and established business, like doctors, lawyers etc.

Kalau employee, might kena ambil insuran for loss of employment, even if you work for government.

Put long story short, I tak dapat bank loan. Not qualified.

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Added on March 15, 2011, 2:16 am[quote=michaellee,Mar 14 2011, 02:52 PM]

Actually 1 acre can build more than 8 terrace houses. If a terrace house is around 20x70, then your area would be 1,400 sq ft. You can build more than 20 terrace houses in 1 acre depending on your town planner.

No lah. It is more like 12 houses per acre. sebab kena ada reserve jalan, dsb.


This post has been edited by nevermindlah: Mar 15 2011, 02:16 AM

My friend, I don't know what's the building by law in West Malaysian like. There is no way an acre can build up to 20 or more terrace house in Sabah & Sarawak. You have to include infrastructure and open space.

The development guidelines for smaller holdings is different those with more than 2 acres. need for minimal public infrastructure like roads, street lights, etc.

So, there's no other way to increase units in Sarawak? As I know, developer can build up to 14 units in an acre in pahang.

depends on the infrastructure. we deal with landscape and earthwork as contractors and most of the time you don't have much to include in small areas. you can build more units if you have only one road instead of two. simple scenario is where main road in front of the unit but a 'small' lorong behind. street lights don't take much of the space. the pavement does. so eventually its up to 'how' the town planner has been told to develop his plan.

This post has been edited by stix: Jun 14 2012, 11:07 AM

Thanks for sharing the info.
So there's no regulation says I could build up to 14 on the plot.
For example, I have 2 acres of rectangular land with electricity and water supply connected. Assuming I could build approx 30 terraces on the land. So, authority might approve the drawing, right?

I heard Sarawak has different set of laws.
Anyone can advise?

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Added on June 14, 2012, 12:14 pmWhere could I find the guidelines?
I think the guidelines could help a lot if people are looking for land for investment

This post has been edited by willytak: Jun 14 2012, 12:14 PM

what's the normal deposit amount required to buy a bungalow lot? heard CIMB can offer loan up to 85%. is it applicable to every cases?

This post has been edited by syarehey: Aug 3 2013, 12:38 PM

Not sure about item 1 to 3 but about item 4; depending on the location, normally a single lot offered will be good to build a bungalow house (if it's located near main road or near any highway). If it is more than an acre I would strongly advise you to build terrace houses. from the total land area you probably need to surrendered 10% for open space (playground/greenery), 40% for carriageways, 6,000 sq. ft. for sewerage treatment plant which left the remaining you devide to 1,400 sq. ft. (if this is the areas you chose for each lot) and you'll get the number of terrace houses units.

thanks many sifu, learn a lot from this thread