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Malaysia - Selling Property
The Selling Procedure
There is a procedure when it comes to selling your house in Malaysia.
The first thing to do is to prepare your property for sale and instruct an estate agent to handle the sale. This will give you access to conveyance and handling of all the paperwork. The estate agent will value the property and prepare the marketing schedule for your property. If you have owned the property for less than five years then you will be liable for Real Property Gain Tax which ranges from 10-15% and is dependent on the purchase price of the property not market value. This is payable at the time of paying the legal fees to the agent or lawyer. There is no Real Property Gain Tax liability on property owned over five years.
Once an offer from a buyer has been received, a letter of offer is signed by you and the buyer. Once this is received by both parties and their respective lawyers and agents the initial deposit is due for payment from the buyer and this can vary between 2% - 3% of the agreed price. Your lawyer will then draw up the Sale and Purchase Agreement which should be signed by both parties within fourteen days. Once this is signed a further payment is due from the buyer of 7% - 8% leaving 90% of the purchase price outstanding.
The Sale of Purchase agreement is then sent off to the Land Registry and once agreed and returned, the buyer then has ninety days to pay the remaining 90% of the purchase price. Once the transfer title deed has been signed, the sale is complete.
The fees payable by the vendor are as follows:
- Estate Agent fees
- Conveyancing fees
- Legal fees for the buyer’s lawyer in paperwork related to any Real Property Gain Tax and any other fee-related paperwork.
Property trends in Malaysia have seen steady growth over the last decade as the country has welcomed foreign investments in property. With industry levels on the increase and the provision of more services, major cities are where property prices top the rankings in terms of price. More rural areas are cheaper. New developments with added facilities such as gyms, swimming pools are in high demand for expats who are moving to the country or looking for a passive income from their investments.
The property market in Malaysia has slowed down in 2012 as the global recession still has a grip in many western countries; however, the market is still investable and is romping ahead in Asia as still being the hot spot for foreign investment. As more retirees use Malaysia for retirement investments and with new developments popping up as developers are now land buying with the view of making money, there are communities emerging in rural areas as people want the combination of being close to major cities but require a more rural living environment.
Property exchange is becoming an increasingly popular way of moving to the country for many expats and there are a plethora of property exchange websites online. It is becoming quite the lucrative business. Property exchange is a way of people exchanging their homes for a certain period of time and this cuts costs for both parties and is ideal for those who are moving to other countries for a certain period of time such as a work contract. It limits the cost of selling and buying property. All that is required is the cost of the fights.
Here is an example of a property exchange website:
Please be aware of scams and do your research thoroughly. Estate agents may also have a property exchange program in place and will charge a fee for such a service.