Buying a property is one of the biggest financial decisions you’ll ever make. In Malaysia, you have two main options: subsale properties (owned by individuals) and new projects (developed by property developers). Each option comes with its own set of advantages and challenges, especially when it comes to securing a mortgage loan.
Whether you’re a first-time homebuyer or an experienced investor, understanding the differences between subsale and new project mortgage loans can save you time, money, and stress. Let’s dive in and explore which option is right for you!
1. What is a Subsale Property?
A subsale property is one that’s being sold by the current owner, not the developer. These properties are usually older and may have been lived in before.
Pros of Buying a Subsale Property:
- Lower Price: Subsale properties are often cheaper than new projects, especially in mature neighborhoods.
- Immediate Availability: You can move in or rent out the property right away.
- Negotiable Price: You can negotiate the price with the seller.
Cons of Buying a Subsale Property:
- Higher Down Payment: Banks typically finance up to 90% of the property price, so you’ll need to pay 10% upfront.
- Renovation Costs: Older properties may require repairs or renovations.
- Longer Processing Time: The loan approval process can take longer due to legal and valuation checks.
How Mortgage Loans Work for Subsale Properties:
- Banks will assess the property’s market value and offer a loan based on that.
- You’ll need to pay for legal fees, stamp duty, and valuation fees.
- Banks will finance up to 90% of the property price.
2. What is a New Project?
A new project is a property that’s being developed and sold directly by the developer. These properties are often under construction or recently completed.
Pros of Buying a New Project:
- Lower Down Payment: Developers often offer incentives like zero down payment or cashback.
- Modern Design: New projects come with the latest designs and amenities.
- Developer Warranty: Most new projects come with a defect liability period (DLP) for repairs.
Cons of Buying a New Project:
- Higher Price: New projects are usually more expensive than subsale properties.
- Construction Delays: There’s a risk of delays in completion.
- Maintenance Fees: You’ll need to pay for maintenance and sinking funds.
How Mortgage Loans Work for New Projects:
- Banks will finance up to 90% of the property price.
- You’ll need to pay for legal fees and stamp duty, but some developers offer rebates or packages to cover these costs.
3. Key Differences Between Subsale and New Project Mortgage Loans
Here’s a quick comparison to help you decide:
| Factor | Subsale Property | New Project |
|---|---|---|
| Down Payment | 10% of property price | 0%–10% (developer incentives) |
| Interest Rates | Almost the same | Almost the same |
| Loan Tenure | Up to 35 years | Up to 35 years |
| Processing Time | Longer (4–6 months) | Shorter (1–2 months) |
| Additional Costs | Renovation, legal fees | Maintenance fees, legal fees |
4. Which Option is Right for You?
Choosing between a subsale property and a new project depends on your budget, timeline, and preferences. Here’s a quick checklist to help you decide:
- Choose Subsale If:
- You want a property in a mature neighborhood.
- You’re okay with paying a higher down payment.
- You’re looking for a bargain or negotiable price.
- Choose a New Project If:
- You prefer modern designs and amenities.
- You want a lower down payment or developer incentives.
- You’re okay with waiting for construction to complete.
5. Tips for Getting the Best Mortgage Loan
- Check Your Credit Score: A higher score can help you secure better interest rates.
- Compare Banks: Don’t settle for the first offer. Compare interest rates and terms from multiple banks.
Conclusion
Whether you choose a subsale property or a new project, securing the right mortgage loan is crucial to your financial well-being. Take your time, do your research, and weigh the pros and cons of each option.
If you’re still unsure, we’re here to help. Our team of experts can guide you through the process and help you find the best mortgage loan for your needs.
Ready to take the next step? Contact us today for expert advice and the best mortgage loan deals in Malaysia!
