In search of a RM250,000 home

Ng Cun Mei, 40, never considered getting her own home until she was told to move time and again from her rental homes because the landlords were selling off their properties.

Since her early twenties after graduating from Universiti Teknologi Malaysia (UTM) in Johor Bahru, Ng had decided not to buy a place of her own as she wanted to be debt-free.

“I don’t mind renting a room or staying with other tenants as it helped keep my living expenses down and I can stay in my preferred locations.

“However, after constantly being told to vacate by the landlords, I am tired of having to move and find a new place, so I knew it was time to find a more permanent home of my own,” says the financial planner who hails from Muar, Johor.

The first thing to do was to start saving 20% to 30% of her salary every month until she had enough to pay the down payment for a house of her choice. “I pretended to have already bought a house and I am paying the instalment to help me be more financially disciplined,” Ng tells EdgeProp.my.

In search of the desired property, Ng clearly understands her priority (easy accessibility to highways and amenities and safe environment) and budget: not more than RM150,000 or less than RM800 of monthly instalment.

It took her more than a year to look at properties on the primary and secondary markets that fit her criteria, especially the pricing element.

Finally in 2010, she signed the sale and purchase agreement (SPA) for a 1,000 sq ft town-house in Nusa Bestari, Johor Bahru, that cost RM150,000.

“I like this township very much and wanted to get a secondary property here, preferably a renovated unit with basic fittings such as kitchen cabinet, wardrobe, door grilles and ceiling fans. However, most of the landed houses in Nusa Bestari at that time were selling above my budget. Then I saw an advertisement of this newly-launched townhouse. The size was smaller than the double-storey terraced houses but the price fitted my budget,” she recalls. This freehold townhouse required a monthly instalment of RM600 which Ng was happy with as she could still maintain her current lifestyle.

In the search for her own home, Ng found that there were plenty of choices on the secondary market. “Finding a house that meets one’s requirement and budget nowadays is much easier in the IT age. With online resources and smart devices, one could save a lot of time in finding the right property and verifying the identity of the real estate agents,” she adds.

Ng may have found the house that fits her budget in Johor, but how about in the Klang Valley? Currently, EdgeProp.my listings show that in the Kuala Lumpur area, one could get a condo unit priced below RM250,000 with at least two bedrooms.

“One has to be realistic. For a budget of RM250,000 or monthly instalment of less than RM1,200, one could still get a house but it’s usually not the kind of property you have been dreaming about,” says Ng.

The “dream home” trap

Many young first-time homebuyers fall into the trap of trying to get their dream home when they first shop for their first home, says VKA Wealth Planner Sdn Bhd licensed financial planner Kevin Neoh.

Instead of getting their so-called dream home which they usually could ill-afford, Neoh says they should start with more affordable homes that match their financial strength.

“Unless you are prepared to channel most of your take-home pay to service the [housing] loan or compromise on other life goals and lifestyle, it would be better to start with a small basic home,” he advises.

“A mid-income single earner will find it tough to buy that dream home with ample space and lifestyle elements,” says Neoh, citing for example, a homebuyer with a net monthly income of around RM3,500 would perhaps be able to pay a monthly instalment of RM1,750 for a property priced around RM400,000.

The advantage of buying from the secondary market

Starting small at less than RM250,000 for a home doesn’t mean one will never get to own that dream home. As long as an individual’s income continues to rise, he or she can upgrade and eventually come to own the dream property, says Malaysian Institute of Estate Agents (MIEA) president Lim Boon Ping.

Buying houses at below RM250,000 is possible in both secondary and primary market, but the difference will be with the location, he notes.

“New homes priced RM250,000 and below are possible but generally these properties from developers are either located at new areas or government affordable housing schemes which come with certain terms and conditions. Investing in a new developing area means one needs to hold the property longer to see the price appreciate compared with established areas with higher demand,” he explains.

Buying from the secondary market allows one to see and touch the property, look at its quality as well as get a feel of the neighbourhood and the surrounding environment, offers Lim. He adds that real estate agents could be a great help in looking for a specific kind of property or location.

On the other hand, buying a brand new home off the plan from a developer is attractive because it usually requires a lower entry cost, what more when developers offer freebies and rebates, he adds.

For second-hand homes, buyers would need to fork out around 20% of down payment and legal fees — one of the main reasons deterring buyers from the secondary market, says Lim.

Neoh from VKA notes that another reason most property buyers prefer buying from the primary market is because it allows buyers to have more time to build up their financial strength as the buyers only need to serve the interest for the housing loan during the construction period compared with buying from the secondary market where one would need to serve the full housing loan instalment once the loan application is approved.

Furthermore, Lim notes that homebuyers psychologically prefer to own a home that others have not stayed in. This psychological barrier has caused many people to overlook some good investment opportunities in mature areas, he adds.

Houses below RM250,000

Undeniably, looking for houses in the Klang Valley that are priced at RM250,000 and below is not impossible but kind of tough if one is hunting for something comfortable plus some trimmings such as a swimming pool and, of course, in a convenient location with good connectivity and amenities.

A search of sale listings on EdgeProp.my revealed a few such properties on the secondary market.

Using the filters on the portal, these were shortlisted based on the following criteria:

• Located in established areas within the Klang Valley

• Good accessibility

• Close to amenities

• Priced below RM250,000

• Possibility of getting a loan with a monthly instalment of <RM1,200 over 30 years

The calculation of monthly instalment is derived from EdgeProp.my’s mortgage loan calculator using the asking price of the property after excluding a 20% down payment and assuming the buyer secures a 30-year housing loan at an interest rate of 4.6%.

Some listings on EdgeProp.my of homes below RM250k

Axis SoHu, Pandan Indah, Selangor (click here)

Monthly instalment: RM1,025
Asking price: RM250,000
Built-up: 500 sq ft; 1 bedroom, 1 bathroom
Accessibility/amenities within 3km radius: Next to Axis Fiesta Mall, close to LRT Pandan Indah station; easy access to Middle Ring Road 2

Ritze Perdana apartment in Damansara Perdana, Petaling Jaya (click here)

Monthly instalment: RM963
Asking price: RM235,000
Built-up: 406 sq ft; studio with 1 bathroom
Accessibility/amenities within 3km radius: Close to the Curve shopping belt and 1 Utama shopping centre; easy access to Penchala Link

Pelangi Damansara apartment, Petaling Jaya (click here)

Monthly instalment: RM738
Asking price: RM180,000
Built-up: 670 sq ft; 2 bedrooms, 1 bathroom
Accessibility/amenities within 3km radius: Close to shops and restaurants, The Curve shopping belt and 1 Utama shopping centre; near schools and MRT Mutiara Damansara station

Kuchai Entrepreneurs Park shop apartment, Kuala Lumpur (click here)

Monthly instalment: RM759
Asking price: RM185,000
Built-up: 930 sq ft; 3 bedrooms; 2 bathrooms
Accessibility/amenities within 3km radius: Easy access to South Klang Valley Expressway (SKVE), Maju Expressway (MEX) and KL-Seremban Highway; near to shops and offices, close to MRT Kuchai Lama station which is currently under construction

Villa Angkasa Apartment, Sentul, Kuala Lumpur (click here)

Monthly instalment: RM820
Asking price: RM200,000
Built-up: 750 sq ft; 2 bedrooms, 1 bathroom
Accessibility/amenities within 3km radius: Close to schools, LRT Sentul Timur station and KTM Sentul station; easy access to Duta-Ulu Klang Expressway (DUKE), Jalan Sentul, Jalan Tun Razak and Lebuhraya Mahameru and Lebuhraya Sultan Iskandar

Apartment Taman Connaught, Cheras, Kuala Lumpur (click here)

Monthly instalment: RM820
Asking price: RM200,000
Built-up: 565 sq ft; 2 bedrooms, 1 bathroom
Accessibility/amenities within 3km radius: Opposite Ikon Mall, walking distance to UCSI University, close to shops and various eateries

Perdana Exclusive Condominium, Damansara Perdana, Petaling Jaya (click here) 

Monthly instalment: RM1,025
Asking price: RM250,000
Built-up: 414 sq ft; 1 bedroom, 1 bathroom
Accessibility/amenities within 3km radius: Close to shops and restaurants, The Curve shopping belt and 1 Utama shopping centre; easy access to Penchala Link

Sky Villa Apartment, Taman Serdang Perdana, Seri Kembangan, Selangor (click here) 

Monthly instalment: RM861
Asking price: RM210,000
Built-up: 650 sq ft; 2 bedrooms, 1 bathroom
Accessibility/amenities within 3km radius: Easy access to KL-Seremban Highway; next to One South Street Mall, close to The Mines Shopping Mall and Serdang KTM station

The Domain Condominium, CyberJaya, Selangor (click here)

Monthly instalment: RM923
Asking price: RM225,000
Built-up: 601 sq ft; 1 bedroom, 1 bathroom
Accessibility/amenities within 3km radius: Close to D’Pulze shopping centre, schools and government agencies

Bukit OUG Condominium, Kuala Lumpur (click here)

Monthly instalment: RM984
Asking price: RM240,000
Built-up: 775 sq ft; 2 bedrooms, 1 bathroom
Accessibility/amenities within 3km radius: Close to Awan Besar LRT station and easy access to Shah Alam Expressway (Kesas)

This story first appeared in the EdgeProp.my pullout on Feb 28, 2020. You can access back issues here.

In search of a RM250,000 home