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A beginner’s guide in purchasing subsale property [2021]


Choosing a subsale property usually has a pre-existing owner who bought it from a developer during a property launch. This beginner’s guide is for you to read before finding the perfect home!


1. Find out your borrowing capacity with your bank


After finalizing the budget and finding out what is affordable, a decision can be made on the most suitable deal for the preferred sub-sale property.


Do check your borrowing capacity with whichever bank fits your preference, be it Maybank or CIMB.


For those who are confused with the term borrowing capacity, it is the sum of money someone is able to borrow from a lender (e.g., a bank).


Also consider expenses like the stamp duty, legal fees, and renovation cost if the chosen property requires work.


REMINDER; avoid the temptation of signing a reservation form before applying for a loan, which may result in forfeiture of your deposit.


2. Discuss and finalize the Sales & Purchase Agreement


A crucial legal document that states the terms and conditions of the sale – where both parties must check and are happy with the details listed out on the SPA.


Before finalizing the SPA, discuss with the property seller on details such as;

  • items and fixtures you would like to be left in the home

  • items and fixtures you would like to be removed in the home

  • renovations

  • additions

  • upgrades that were performed previously

Since subsale properties do not come with a defect liability period (DLP), if you do not specify any damages in the contract – you will be responsible for any consequences.


Once you have negotiated and updated the deal, remember to include all the Sale and Purchase Agreement details.


3. Determine either Bank Value or Market Value will benefit you


While performing a valuation of your subsale property, keep in mind that there may be two different types of valuations – the bank value and the market value.

  • Bank valuation of a property is purely dependent on numbers. For example, a bank’s valuation for a house tends to be lower than the market value, due to its tendency to be objective and conservative.

  • The market valuation of a property is what the market is willing to pay for your house.

In simpler terms, the bank value of a property is solely dependent on numbers while the market value of a property is driven by how people feel.


By determining which will value the most as a buyer, you will get the best deal out of the process.


4. Hire a lawyer to help you along the process


While it is now necessary, the buyer should hire a lawyer for a property transaction. By hiring a lawyer, they will ensure you get a fair deal, double-check the contract’s detail and protect your rights.


Unless you are an expert in tackling bureaucracy at the Land Office, or negotiating legal contracts, you will find yourself stranded in a field of arguments and legality for months.


Do not waste thousands of Ringgit to be flushed down the drain by thinking 2 to 3 steps ahead before purchasing your subsale property.


5. Lastly, remember to follow up!


We live in the age of technology, where everything can be accessed with just a click of a button. After everything is signed and ready, have their mobile number, email address, and social media pages to know your subsale transactions’ updates.


Time to call a house a home?


Now that you have a good understanding of what you’re getting into when you purchase a subsale remember the choice is always yours.


So whether you’re buying a subsale property to stay in or invest, the earlier you plan – the more options and opportunities to choose from.

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