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> Why ppl refer to buy new house?

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TSsoules83
post Jun 12 2019, 06:15 PM, updated 5y ago

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Hi Guys,

I notice a lot of ppl prefer to buy new house from developer rather than 2nd hand market. Don't you think its a crisis for property investor?

The reason are:
1. Developer warranty is available for new house
2. Reduce renovation cost
3. Waived GST, lawyer fee and more
4. Affordable due to cash rebate for upfront fee

And the disadvantage of second hand house are:
1. High renovation and repair cost. Usually the seller and the agent won't let you know what problem the second hand house have.
2. High upfront fee
3. No Warranty, if the seller or agent cheated you. You are done once the deposit is paided
4. GST and lawyer fee incurred.

From what I see above, I cannot see its a good thing to invest in property.

What do you think? And how can we remedy the problem with second hand house?

This post has been edited by soules83: Jun 12 2019, 06:17 PM
TSsoules83
post Jun 13 2019, 07:54 AM

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QUOTE(Bjorn1688 @ Jun 13 2019, 01:34 AM)
I'm an investor in both old and new.
Subsales tend to be premium and prime stuff that I found at a discount. Nearly all subsales I've bought are landed or very high end condos.

New launches, I buy condos but I don't really buy the 1st launch and wait 4 years for it, I buy when it is nearing VP, already VP or unit still in new condition.

One thing you have forgotten, all the reasons for a new buy have already been priced into the purchase price, everything you said we are getting for free, its been factored in. Also most places that are sold with high rebates aren't investment grade investments or you need to be an extremely skilled one to navigate this minefield.

As for the disadvantages you mentioned for subsale, that depends who you are smile.gif

Upfront fees? There are always ways and means to press down the price and get an over-valuation from the bank that negates the high entry cost fees.

Renovation and repair cost? Who asked you not to do your homework?

Warranty? Does not appear new properties are all that better these days.

GST been abolished smile.gif

Lawyer fees, non-issue. Rather pay and have my interest well taken care off. You do realise when the developer pays it that the contract will always favour the one who paid  biggrin.gif

As for which I prefer to buy for long term investment, I'm not a property flipper. Also I don't buy a property unless I have a 30-40% deposit and I strictly buy based on location.
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Renovation and repair cost? Who asked you not to do your homework? <---- its easier to said and done, not everything can be detected on the spot except you stay here for months.
TSsoules83
post Jun 13 2019, 09:45 AM

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QUOTE(aurora97 @ Jun 13 2019, 08:33 AM)
Not necessary staying for months also you can detect it, some may take years.

Then again, a person who has bought enough property and having to deal with the mess (both time and money), you will notice a thing or two.

If in doubt, there are professionals out there that can inspect the property for you.

Unless you are prepared to pay someone else to do the job for you, be prepared for high renovation and repair cost.
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"there are professionals out there that can inspect the property for you" <--- I would be interested to know where to find those services, and second to that the agent also need to give you the key even before you put the deposit.

Not sure there are law where buyer can reject the deal if too much problem is detected.
TSsoules83
post Jun 13 2019, 11:52 PM

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QUOTE(aurora97 @ Jun 13 2019, 01:24 PM)
1st question - google search: type: property defect inspector malaysia.

If too lazy, here is one example, btw i dont endorse or promote this company, this is just an EXAMPLE:

https://www.canaanbuildinginspector.com

If sub-sale, i would tell the agent, i will pay deposit and i will buy the unit depending on satisfactory outcome of inspection. If domt agree then no deal.

Sub sale, rule of thumb:
1. Caveat emptor: buyer beware. (Google search for full meaning kay);
2. As is where is basis. Or what u see, what u get.

Only exception if the seller gives u warranty or representations.

If nothing in writing, the odds will be against u or ur case will be much harder for u.
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good info. thanks a bunch! flex.gif
TSsoules83
post Jun 13 2019, 11:54 PM

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QUOTE(Bjorn1688 @ Jun 13 2019, 03:49 PM)
Just because you can't spot it doesn't mean other people can't or can't do it for you.

I call in my usual renovation contractor, give him 2 hours he can tell me everything that is amiss with a 4000sf semi-d and you'd be surprised what a UV torch could reveal about a house.

RM400 is all that it cost me to find out every single thing that is wrong with the house.

Most sellers would allow you to inspect all you want if there isn't anything to be discovered. Find an issue adjust the price accordingly.
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sounds good. maybe should revisit with the renovation contractor to review if decided to buy.
TSsoules83
post Jun 14 2019, 01:41 PM

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I have to admit the warranty for new building is attractive. And low downpayment is the key.
TSsoules83
post Jun 14 2019, 06:40 PM

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QUOTE(Bjorn1688 @ Jun 14 2019, 02:58 PM)
A warranty on a building is only as attractive as the developer willing to rectify in a timely manner.

Unfortunately those types of developers usually build developments that are not investment grade or at least not the type where you could easily make money on unless you are already wealthy.
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subsale also not cheap, if its a really prime area...
TSsoules83
post Jun 14 2019, 06:43 PM

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QUOTE(Harry_Bobinski @ Jun 14 2019, 02:38 PM)
While you may get new development that is filled with promises by developers, there is a chance for it not happening. Take Alam Impian and Laman Glenmarie for example. Alam Impian was promised with tons of new commercial developments and people flock in and buy for investment. Think this is back in 2011? 2013? Not sure. And as for Laman Glenmarie, the only ones staying there now are very few random families and DRB-Hicom people who bought at a discount. At that time tons of people buy it thinking it would be a great rent market with the university closeby (manatau an in-campus hostel was build). So when you buy a house, even for own stay, if new development it is still a risk.
I am currently 20 plus and was viewing 1.2m house leh. There are still agents showing you around and very detailed and patient.
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Yeah. There are such risk "if you looking for investment". But for self stay or so call first house. Usually its from developer due to the down payment. Nowsday some developer provide fully furniture house some more!

But if you go get sub-sale, sure it would be more expensive than developer in total.
TSsoules83
post Jun 16 2019, 05:18 PM

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QUOTE(MrBlackie33 @ Jun 16 2019, 09:00 AM)
Just bought a decent size completed developer units, which i save on progressive interest, get free warranty, free MOT and only have to pay legal fees, summore the price is the same as launching price
But tbh alot of gud decent size subsale unit in the market with reasonable price which you couldnt find the same in new project now
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you didn't factor in the repair cost yet.
TSsoules83
post Jun 17 2019, 08:50 AM

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QUOTE(MrBlackie33 @ Jun 16 2019, 05:23 PM)
repair cost for subsale unit? i was only eyeing for those just vped virgin unit, so to keep minimum repair cost even thou the DLP may have ended.
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what is vped virgin unit?
TSsoules83
post Jun 18 2019, 08:15 AM

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QUOTE(Genji Shimada @ Jun 17 2019, 06:22 PM)
Wouldn't you guys scare about buying a new unit but in the end, the unit has lot of problems, like water leaking, wall or floor cracking, the final outcome is not the same as expected and etc?at least buying a second hand house can have a look on the actual property first
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problem is sub property don't give you enough time to inspect the unit and sub sale unit its like after someone wear the cloth and sell it to you, for new developer unit...you may knock the wall to check until u syok.

This post has been edited by soules83: Jun 18 2019, 08:17 AM
TSsoules83
post Jun 18 2019, 01:11 PM

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QUOTE(kevin23 @ Jun 18 2019, 10:13 AM)
If everything scared then no need to do anything better.

These kinda problems are all fixable issues. Every property has their issues. At least got issues u can complain to dev and F them.

U buy subsale, u cant detect all those hidden issues. After u buy only u found out got that issue. Then u have to fix it urself.
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nowadays new unit also provide free furniture too! Its like all in one.
TSsoules83
post Jun 18 2019, 02:59 PM

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QUOTE(aspartame @ Jun 18 2019, 02:06 PM)
Ha ha...u r the exact kind of water fish developers are capitalising on...

No cash... loan big big.. get cash back .. spend them all... upon vp cannot sustain even 2 months installments and up lorry ....

In fact almost all the auctions are these kind of overpriced new vp props bought from developers with rebates...

I think if u take out the rebates... buyers did not lose that much... but they spent the rebates !!! Now kpkb
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flipper also do the same tactics.... biggrin.gif Buy from developer with loan big big then sell it off to water fish like us to gain capital..

This post has been edited by soules83: Jun 18 2019, 03:00 PM
TSsoules83
post Jun 18 2019, 04:13 PM

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QUOTE(Bjorn1688 @ Jun 18 2019, 03:13 PM)
Excuses.
As a buyer all the cards are in your hand, if you want to visit 10 times the agent or the owner will comply if they are interested in the sale.
I can guarantee you no developer will let you into the unit you want to buy unless that place is "tak laku"

P/S: Which new prop are you selling? biggrin.gif
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"As a buyer all the cards are in your hand, if you want to visit 10 times the agent or the owner will comply if they are interested in the sale" <---- you serious? You never bought any subsale house before do you? You think their time is cheap?
TSsoules83
post Jun 18 2019, 04:56 PM

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QUOTE(cc980024 @ Jun 18 2019, 04:53 PM)
So far I never buy from subsale. I am very particular on the history (the energy of the house). As I have seen some fun example, one of it where my friend bought a subsale with history of 2 past owners who didn't get to stay in the house, due to being call for duty overseas. And this friend of mine, have been waiting response from the embassy to get her migration approval for nearly 5years.. thinking it fails.. she bought this subsale .. barely few months stay .. she move to Canada, again put out the house for sale. The house keep having owners (that end up settle down in overseas).. no permanent resident at all.

And my uncle's house say to produce baby boys only. For 3 generation, never see any baby girl around. I was 1 of the tenant of this house before too. tongue.gif

So, good energy of subsale is a luck, but unfortunately we hardly know it all. If buying subsale for own stay, must investigate why the owner selling it. For me, ppl sell house due to debt, due to marriage divorce.. is a no-no.

Since $ is also a consideration, and this "old house energy" thingy, I so far only buy from new launch.
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not bad, maybe I should go rent there. I want to work oversea.
TSsoules83
post Jun 19 2019, 10:40 AM

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QUOTE(Bjorn1688 @ Jun 19 2019, 01:34 AM)
Last 16 years bought 39 subsales in various shapes and forms either to buy, fix and flip or buy and flip or buy to rent either on my own or as a partner to it.

Never had a single owner or agent that said we could not do a thorough inspection.

These days they all the more are willing to let you check all you want as they mostly know you are a serious buyer, only time it becomes problematic is where the unit is tenanted, sometimes you may get a hostile tenant.

How many subsales have you bought since it seems everything about it is a mountain of a task?
Interesting on the house and babies. I have a studio bought new that seems everyone that's lived in it have become parents. 1st my missus and me moved in on VP and lived in it for 3 months. 2 months later found out she was 3 months pregnant, best part? Was told by several that she could not conceive.

1st tenant, this Australian girl, she lived in it for 6 months and then found herself pregnant

2nd tenant, an American woman in her early 40s, not sure how anyone could bring himself to get busy f-ing her but holy crap 4 months into the tenancy she became pregnant and recently had a baby.

One subsale house I co-own, we bought it through an estate sale. Children fighting over late father's property. I wanted it purely because it was a property bearing #8 as the lot number. I knew the old man died in the house. When I called for a monk to remove the altars, shrines and statues out of the blue he mentioned to me don't ever get rid of the pond at the rear corner of the house and he said if I had the funds to renovate it to have a jar that faced the direction of the house.

2 set of tenants and both did very well in their career and the current tenant also became a big shot after living in that house.

Unfortunately this house has also become a bit of a burden, afraid to sell it off because the 5 children that eagerly forced the sale of the house from being very well off are now mostly broke or jobless. Its the  only landed house I own that I actually hire a gardener and someone to tend to the pond
Depends on whether you want to believe in it or not. But usually for every negative energy there are ways and means to neutralise or counter it.
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so far...3 house. 2 unit got a lot of prob.
TSsoules83
post Jun 19 2019, 03:22 PM

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QUOTE(Harry_Bobinski @ Jun 19 2019, 11:57 AM)
Not true, and Bjorn1688 is right. I have visited too many subsale units, most of which are more than twice (those that I am interested in) - Bandar Kinrara (Agents are usually snobs), Putra Heights, Bukit Jelutong, and Bandar Rimbayu. As a matter of fact, they are more than welcome for you to visit their place, the more times, the better cause they will have the assumption that you are interested in that place. TBH, if your place is advertised for more than 2 months and no one has been showing interest, I bet you will entertain anyone who wishes to see the houseĀ  no matter how many times
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But the problem is inspection is not 1 hrs or 2 hrs stuff. it could take the whole week! blink.gif Some even months! For example, if pipe bust, can only detected after you re enable the water supply!

This post has been edited by soules83: Jun 19 2019, 03:26 PM
TSsoules83
post Jun 19 2019, 03:25 PM

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QUOTE(Bjorn1688 @ Jun 19 2019, 02:12 PM)
What are the nature of the "lot of prob" for those 2 units?
Oh, I meant the original owner that died in the house smile.gif

Thus far, the property has delivered more than what I had expected.
Selective reader aren't ya?
Yes am scared to sell it.
My most recent subsale, owner gave me the key and told me to go check all I wanted on my own.

I've had situations where the tenant did not want to allow entry and I simply told the agent to inform the owner can't inspect so not buying. Usually within the hour I will get a phone call telling me when I could perform an inspection and to be as thorough as needed. Especially the case where they been trying to sell the house for awhile.
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One is for self stay another 1 is rent to ppl. Both have a lot of hidden issue, like there are leak from the roof (the owner repaint it to make it look nice, but there are roof leak). And there are one unit with electric shortcircuit case, burn out a few line. That one spent a lot to replace the wire. Another worse one is burst pipe, only unit you go enable the water supply baru know there is a critical leak, one 1 month RM200 water bill. And more...

This post has been edited by soules83: Jun 19 2019, 03:27 PM
TSsoules83
post Jun 19 2019, 04:48 PM

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QUOTE(cc980024 @ Jun 19 2019, 04:41 PM)
If buying with the intention to rent it out, subsale could be better option than new 1. Coz subsale usually at better location and able to carry higher rental. My sister bought a subsale with condition to continue renting it out to the current tenant (that time). As she was renting a house in the same neighbourhood, so she don't mind as the rental she pay is lower than the rental she collected.
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where? biggrin.gif I never see any subsale can rental with rent > installation.
TSsoules83
post Jun 20 2019, 01:11 PM

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QUOTE(Bjorn1688 @ Jun 19 2019, 10:34 PM)
All those problems mentioned could have been avoided or at least you been made aware off had you brought your trusted renovation contractor or paid for a home inspection service.

These days they don't even need to climb, they just place a drone with a UV light and camera and 99% of roof leaks can be detected within 5 minutes.

Am surprised you did not place any clauses in the SPA with regard to the pipes since you could not test it.
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"Am surprised you did not place any clauses in the SPA" <---- we can list the repair cost in SPA and ask the owner to paid after detect it?

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