Buying a property is a big decision. It is usually the biggest purchase we will ever make because it’s usually a few hundred thousand ringgit if not higher. Even affordable homes are usually RM400,000 or lower. This is why for first-time home buyers, they are usually the first to worry and the last to buy. First to worry means as soon as there are any negative news, they retreat first. Last to buy because when the market is positive, those who has bought before or property investors will be the first to buy. When first-time home buyers see this situation, they will have the confidence to buy and this is why they are last to buy (compared to the experienced buyers). When we understand this, we need to do three things to help first-timers in their property purchase.
#1 – Educating them about financial awareness and that investment is long term and there are definitely ups and downs along the way. The key is financial management and not sudden huge profits or losses. Perhaps have continuous talks and engagements where the first-time home buyers could listen, learn and ask questions to people who are like them previously. (let’s talk to them on basics…) A very real example? ‘Hedge against inflation’ does not mean much. ‘Money getting ‘smaller’, avoid losing more money by investing’ is much easier to understand.
#2 – Numbers, numbers and numbers. More access to information on property prices, on availabilities and on all the locations where these affordable properties are located will be extremely helpful. All in one place, please. If we expect first-time home buyers to browse through 10 different sites or 10 different media / newspapers, they will just get confused and then suffer from analysis paralysis. A very real example? Many continue to believe that only landed properties rise in prices. Many also believe that they should only buy in those few popular areas. When there are none available, they give up on all other areas…
#3 – Incentives to follow. This is where the stamp duty exemptions come in. This is also where the discounts from developers come in. This is also where all media must be united in telling the first-time home buyers about the upcoming events. Get them to go and in these events, get government officials to give talks and not just the property experts. These will give the first-time home buyers more confidence because this is their FIRST TIME. Do we believe they will believe a stranger on stage telling them that they should just pay deposit and buy a RM400,000 property? 😛
Unfortunately, the step #3 cannot be the first step or the only step. It has to be after #1 and #2 and then the success of any campaign to get first-time home buyers to buy for their very first time would work. I still remember my wife and I used 4 months to evaluate before we bought our first apartment which was only RM123k. Now imagine someone looking at a RM300,000 property and thinking if they should or should not buy? We appreciate a discount only after we understand about market price. Else, whether 10% or a 20% will not mean much. Happy understanding.
written on 11 March 2019
Next suggested article: 10 reasons why we should buy a property – Part 1