Besides the usual 10% downpayment and the lawyer’s fee, every new buyer must also be aware of all the other additional fees and charges. Stamp duty is how the government taxes you for your property purchase. Typically, stamp duty would be based on the following:
1% for the first RM100,000, 2% for next RM400,000 and subsequently, 3% for any amount after that.
To illustrate, for a RM500,000 home, you would need to pay following:
RM100,000 x 1% = RM1,000
RM400,000 x 2% = RM8,000
Total is RM9,000
The rest of the other fees are not as much as your downpayment, lawyer’s fee and stamp duty but can still set you back a bit. I will not go into one by one but you may refer to a very nice infograph by imoney here. Get ready your Excel sheet and start putting in all the necessary fees. Keep that file for continuous usage. You would not stop at one property, that’s for sure.
I know, after you have calculated all the fees you may feel a little overwhelmed especially if this is your first purchase but rest assured, it is also this reason that majority of the first time buyers has yet to purchase their first property. If you have the capability and can make the decision to proceed, you now belong to the minority and do you know what happens to minority who’s ahead? They stay ahead as they continue their journey in life. The only advice would be to ensure what you buy is really what you need and not what all your friends say you need. Also, for 2014, I would advise that you buy secondary property if you are looking for your first property. Lots of diamonds in the rough in the secondary market at this moment.
Do not forget, there is also the renovation costs. If possible buy one which is renovated. If not, then set aside RM30,000 for basic renovation of kitchen, lightings and fans. You can do it for lesser if you have a good friend who’s doing renovation. I do not believe you need to make your home look like a ‘palace’ because later on when you need to sell your ‘palace’ you may regret all the money you have spent. A ‘palace’ to you may just be an unwanted renovation to your potential future buyer.
written on 30 Jan 2014
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