Wednesday, November 30, 2011

The cost of selling a property in Malaysia

If you were to buy a property for investment, you should be well aware of the cost involved in buying the property, as well as the cost to sell it later.

The typical cost of selling the property consists of:
1. Advertisement fee to look for buyer (if any).

2. Agent fee (if you engage property agent to help you to sell your house): between 2%-2.75%. Officially, it is 2.75% if the selling price is below RM500k, and 2% if the selling price is above RM500k. There is a 6% government tax on this agent fee too.

3. Lawyer fee for Sales and Purchase Agreement (calculated based on the property's selling price, if you engage a lawyer on your behalf. You can save on this if you use the buyer's lawyer):

  • First RM150k = 1% (or minimum RM300, whichever higher)
  • Subsequent up to RM1 million = 0.7%
  • Subsequent up to RM3 million = 0.6%
  • Subsequent up to RM5 million = 0.5%
  • Subsequent up to RM7.5 million = 0.4%
  • Above RM7.5 million = negotiable
4. Deed of Receipt & Reassignment, Revocation of Power of Attorney, Letter of Undertaking, Statutory Declaration, etc. = a few hundreds                      

5. Miscellaneous legal fee = at least a few hundreds

6. 6% government tax on total lawyer fee

7. Submission of CKHT 1A form per seller = RM300 (RM600 if the house is jointly owned by 2 owners) 

8. Real Property Gain Tax = 5% of net profit if selling within 5 years of acquisition

9. Penalty payable for early mortgage settlement (if still within lock-in period) = depends on the loan agreement

Besides, you can get back some surrender value (partial refund on premium paid) from the following (if applicable):
  • Mortgage Reducing Term Assurance (MRTA)
  • Fire insurance
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    5 comments:

    Jackie Champion said... Reply To This Comment

    Hello there! I'm glad to stop by your site and know more about how to sell a house. Keep it up! This is a good read. I will be looking forward to visit your page again and for your other posts as well. Thank you for sharing your thoughts about home sales in your area.
    Many standard real estate contracts are going to give the home buyer the right to inspect the property, so be prepared. Have your home inspected before you advertise. Under a general inspection you might be obligated to make major repairs to appliances, plumbing, septic, electrical and heating systems, etc. You can expect your home’s roof and foundations to be inspected, as well. Follow the recommendations and make necessary repairs. Additional inspections requested by the buyer are customarily at their expense.
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    Jhony Walker said... Reply To This Comment

    These days, the residence tax omission fight carries on. Should your cathedral be able to develop a huge developing to rental to a For Benefit Day Care Middle and with the lease money pay off the structure's mortgage? Does a personal university need a tennis course for players who are not learners when university is out so as to spread the price of the tennis course? These are the concerns that regional tax assessors, the legal courts and the govt in Trenton battles with everyday.
    renters rights.

    Ismail Vermillion said... Reply To This Comment

    This is good. Your info really help me a lot as newbie seller.

    Tan Pk said... Reply To This Comment

    Hello Writer, U seems to emphasize a lot on selling a property like a house in Malaysia. As i have a piece of agricultural land to sell, it will be helpful if i could be advised on how much cost will be involved in the sale ? Further to that, this property (actually is a productive paddy land presently tenanted out).

    Voyager8 said... Reply To This Comment

    @Tan Pk

    I don't have any experience in selling agricultural land.

    Perhaps your property agent or lawyer can furnish you the detail.

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