Hi, really sick of renting house! Wana buy house ASAP !

Do u think this is an good investment?
and am I afford to buy it?
Really lack of experience in buying property.Appreciate if anyone could help me out, see what have I lack of or what i have missed. Million Thanks.

Property:
Price of the Property: RM165000
Terms of Loan (yrs): 30
Interest Rate :5.99 %
Down Payment : RM16500
Monthly Payment:RM889
Rental: RM1000-1200
Maintenance: RM100-120
Type: Apartment, lease hold (now I believe is ald 25+-years old)
Condition: Old, near LRT, quite low class and messy.. but i think many ppl will willing to rent because is near to LRT and shopping complex, near city center

Personal Finance:
Salary:RM3000 (able to save RM1200 - RM1500 every month)
EPF: RM 10000
Savings: RM12000

Interest rate 5.99%?
I guess it is those fixed rate by AIA?

Anyway, the monthly installment is RM900
Your salary is RM3000.

RM900/3000 = 30%
If you do not have other commitments, i believe you should be able to get your loan approved easily.

1st of all u need to get a credit card for 3 months if u dont have other commitment coz they need it for ur credit evaluation CRISS.

Is a good investment as house price tends to appreciate(in most case) compare to car which is a definite depreciation

With a house u think u can rent out some rooms to cover ur rent if it is too taxing

if u r interested in getting housing loan kindly contact me as i provide below the market rate loan

Actually, Im not sure whats the lowest rate right now...just simply calculate from iproperty calculator. so whats the best rate in town?

VpowerZone, thanks for your prompt.

---

Added on August 17, 2008, 12:56 amHi ed0gawa,
What I concern is ....is it worth to buy a 20+ apartment for investment?

and with my financial right now, targeting RM165k - RM220K property.. is it a wise move? or I need to wait until my salary increase (of cos with EPF) ?

I got no commitment at this moment. Im 26 years old.

This post has been edited by kanasai88: Aug 17 2008, 12:56 AM

As a financial adviser (not qualified yet in msia)

U should aim upgrowing towns for a better house compare to old 2nd hand house. And with ur savings capability i advice you to go for more exp house reason being

When u r saving ur $$ in bank basically u r losing money bit by bit, even though you are earning FD type of interest u r still losing money as inflation of msia is recorded on average of 6-7% p.a. and for this quarter in msia is it reported at 7% already. As inflation eats up the VALUE of the amount of your SAVINGS and INTEREST is to soften ur depreciation of ur value for your money.

Why target new house instead of 2nd hand house?
New house sold by developer are generally in its basic price and it will normally appreciate due to real estate agents and property investment going in. Where else the price of 2nd hand house are normally being mark-up to up-to-date market value of the house or worst be mark up by ridiculous real estate agents(if u r buying from them most likely this will happen)

Things to look at for a good house that will appreciate
1. Surrounding infrastructure (roads, commercial areas, school, hospitals, police stations, petrol, the condition of the utility surrounding the area.
2. People (surrounding houses are low cost or medium cost or luxury bunglow, security and ur neighborhood basically)
3. Price (survey the median price for the property similar to yours)
4. Developer (if possible buy from prominent developer e.g Sime Darby, IOI, PKNS) as their property sell like hot cakes most of the time (due to strategic planning) which also means ur property will appreciate and fetch good rental returns

Some tips of uprising property price (AGGRESIVE)

Shah Alam (sek 7) Bandar Seri Permaisuri Puchong, Kota Damansara

Ur MOR (margin of repayment or repayment capability) can easily get a 250k loan approved

I would suggest u wait for another bonus before buying a house as there are many hidden costs will incur

e.g. Lawyer fee, renovation, furniture, stamping which will cost up to 10k (depending on the price of ur property) normally it is around there

NOTE: Things to look out for when getting loan.

When u plan to get a housing loan (given u r going to hold the house for 5 or more years) opt for those that provide FREE LAWYER FEE (normally they will tell u ZEC (zero entry cost) or FMC (free moving cost)) When they offer u such MAKE SURE THAT IT IS PAID BY THE BANK OR FINANCIAL INSTITUTION AND NOT ABSORBED INTO UR LOAN AS IF IT IS ABSORB U HAVE TO PAY INTEREST FOR THAT AS WELL WHICH CAN COST A BOMB!!!

please pay attention to abovementioned note

if they give u bullshyt about no1 pay for the lawyer fee go for other bank/financial institution

It is true that with his income, he should be able to get a loan for a 250k property.
But that is subjective too ..... if he doesn't have any credit record, or a job that are seen as 'unskilled/unstable/unprofessional' by those kolot credit reviewer.. then it might pose some problem.

Well, also on your point of having the legal fees absorbed in the loan, it might be good and bad.
Let's say the bank offer you -1.85% ZEC package VS a -2.2% NZEC package but allows you to add in the legal fee to the loan. It turns out the -2.2% package monthly installment is lower than the -1.8% package.


@ kanasai88

Older property might have a better location compared with new projects.
Like in Johor Bahru (erm yeah, i am based in JB .. so i don't know much bout other states). All the new projects now are located quite far from the town area. Lands nearby are all taken up and developed. The price of a 'old property' near town might be the same price as those that are further away from town but are 'sparkling' new.

It goes back to what you want actually. A house near town which is convenient for you? Or a new property further a little ....
So is it worth it?
Personal preferences actually..

Personally i like non landed property (condo/apartment) and i don't care if it is leasehold or freehold ... but people around me keep asking me ' WHY ? WHY WHY? ' . Just personal preferences lo ....

yes, I got credit card already. it is still a good investment if the house already 20-30 years old? but the location is very good la.. near LRT

Kanasai, mind sharing with us where is this place?

Was in the same situation as you when I looked for my 1st property(was looking for a < 180k property) almost 3 years ago, perhaps I could share with you what I knew.

hi donki85,

Thanks for your generous advise.
I wish to buy new house (landed better) but with my earning power and cash on hand, I only able to buy an 200k+- apartment. Im working in center of city. If buying a house with my current cash on hand, I only can buy house located far from the place i work i.e shah alam, puchong ( I do not have transport, travel by LRT to work).

Yeah, it is true that there are many hidden cost. Ill take note of that.

Loan:
normally whats the procedure applying loan? pay deposit to owner--> apply loan --> or apply load--> pay deposit?

Really appreciate if anyone can enlighten me, noob noob here..

---

Added on August 17, 2008, 10:42 amHi Pai, of cos.

The place is near University LRT station



This post has been edited by kanasai88: Aug 17 2008, 10:46 AM

buying for own use or rental/investment?
If own use, the place you mentioned (University station) may not be a great place to stay. The LRT is very convenient anyway.
The units nearby that area ?vista is very old. But cant complain much as the price is cheap (160k+)

Yes, is vista !

ok, my plan is like this... Ill buy a unit in vista to stay + rent out (since im single, my rental now is RM1150). Will consider another units when plan to marry (wont be in Vista, the environment...err...sucks).

I can see UOA is building bangsar south here, and trying to make the environment better ( bustop, road side....), but another concern is when UOA "built" the bangsar south, Vista will become depreciated?

This post has been edited by kanasai88: Aug 17 2008, 12:13 PM

i think i know which ad you saw. but is it for your own stay or for investment? from the headline you sound like you're buying to stay but there are mentions of rental, so i'm a little bit confused.

personally for me, vista angkasa is not a good place for own stay, have you visited any units there? if you getting it for investment purposes i think you'll more likely attract students rather than families, but that's your choice if you want to choose your tenants.

btw, 5.99% should be AIA, good if you're looking for fixed rate whole tenure. i think alliance bank offers a better deal, but your preference matters most really. since you're browsing iproperty already, which don't you search for it and compare?

Hi livingmonolith,

Actually im renting a house in Vista now (RM1150)
what in my mind is, is better to own a unit rather than rent from people with this kind of rental.

My plan is buy a unit, own stay and also rent room to people. and this is what i do now, rent a whole unit, then rent other rooms to people so that i can cover some.

Do u think a 20-30years old unit worth RM165k?

I have compare the price around...is almost around that price, depend on which block. What loan are you suggest? Im using 5.99% because i wan to estimate more instead of estimate min.

This post has been edited by kanasai88: Aug 17 2008, 12:28 PM

Depends on the apartment's condition. It is a good buy if it's well maintained. Usually properties near LRT amenities will have good rental and they usually have a better price tag when it comes to selling.

Based on your financial condition, I think you should be able to support. Don't forget to take the hidden cost, maintenance fees, etc into account.

All the best to you!

Hi agape_ian

say the apartment already 30 years old. after 69 years, it wont belong to be?

or say like this, year by year, my property will depreciate because is lease hold?

Once the lease expires, the land reverts to the state. The owner will then have to apply for a renewal of the lease.

About depreciation, because it's lease hold doesnt mean the property actual market value will drop.

Hi VpowerZone,

we can apply to renew the ownership? how if Im dead and leave the property to my son, can he apply ? Since the property is won by him already..

mm...then y should have lease and freehold? since its renewable...
sorry...maybe got other reason i duno.

Bro, seriously think u shouldnt go for this Vista, its just teribly mantained and price will hardly appreciate given its current condition and management office. Suggest you topup a bit and go for Panorama studios(rent is RM1.1k-1.5k) OR the 3bed hillpark instead. At least these are condo's with decent facilities, security and most important, future capital gains potential.

Good luck hunting

Hi Pai,
Actually one of the reason I choose Vista is because my own self too. I do not have transport to work, i need to rely on LRT. But erm, is not an bad option too choosing Panorama & Hillpark.
How does the pricing look like for 3 bed rooms in panorama? rental ?

Hill park is quite far for me, unless I buy a car first. but but but ... if I buy car...sure will delay my plan to buy house.

Am I too rush? I really sick of renting people's house any more.

my advice is , don't buy a property just bcoz u wanto get rid of renting house. by renting , u get to stay in a house cheaper than instalment , free of debt , can change house every yr if u wanto, no need to worry about BLR fluctuation, least worry about monthly maintenance fee if any and tenants problem. there are also alot of fees involved like fire insurance n assessment.

looka at the money u r paying for legal fees n S&P n bank interest , this amount of money can probably pay ur 2-3yr rental for room, allowing u to save enuf to buy a house for ur permanent stay in 3yrs time.

btw, i m still renting a landed house worth 600K while paying rental of rm230 for my own room, at the same time receiving rental from the apartment i rented out.