We may have saved enough for the down payment for a home. Say RM1,000 per month x 12 months x 5 years = RM60,000. So, does that mean we are ready to buy now? Yes and No. Yes if we actually have more than enough in the banks beyond just this or that we found a cheaper property. Also, it would be good if we have taken into account some extra stuffs like stamp duty and legal fees… Haha. No, we are not yet ready to buy if we have ONLY saved enough for down payment and nothing else. Not even some extra money for renovation fees which will be necessary unless we are buying a renovated unit and we happened to love every bit of the renovation.
So, how is stamp duty calculated here in Malaysia? Image as below. Note the word called ‘Valuation.’ It is NOT possible for you to buy a RM500,000 unit and pay stamp duty based on RM500,000 if the unit is actually valued at RM800,000 yeah. Stamp duty will follow RM800,000 instead. Jabatan Penilaian & Perkhidmatan Harta (JPPH) determines the property value. I know this because my friend bought a cheap property at RM700,000 but she had to pay a stamp duty based on RM850,000 instead.
The legal fee information above were provided by lawyer Alfred Chong. Connect with him if you have any legal enquiries yeah. (click here)
Now that we know that there are actually EXTRA on top of what we have saved for the down payment, there are two things we could do. Continue saving for 12-24 months more. Alternatively, how about buying a cheaper property instead? Just remember cheaper here should also mean that the valuation for that property is a lower one yeah. Just finding a desperate owner selling us a property at way below market price still does not work for stamp duty valuation. Happy buying!
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