When it comes to purchasing your first house, there are a few things to keep in mind like the right age start investing on property, the amount you should spend and so on. To gain a more in-depth understanding on this matter, we checked in with Natasha Gideon, Real Estate Negotiator, to seek her expertise in the real estate world.
#1 Why did you decide to pursue a profession in real estate?
I began my career in the real estate industry in 2015 as a property journalist. I then became more immersed in the industry and decided to try my hand at sales. Fast forward six years later I am 100% in it for the long run!
As a real estate negotiator, I assist clients to find properties for rental, buying, investing, selling or letting. The scope of work includes everything from property inspections to (Sales and Purchase Agreement (SPA) signature. After that, the lawyer will take over to proceed with the rest of the process, but a real estate negotiator can still continue to serve his or her clients.
#2 What are some pros and cons of working as a real estate negotiator?
The advantages of working as a real estate negotiator include the flexible working hours. You also have the freedom to make as much money as you desire and depending on the company and agency you work for; you can work your way up to obtain amazing benefits like passive income and housing subsidies.
On the contrary, flexible work hours means you never really stop working. Besides that, although as a real estate negotiator you are your own boss, the clients are who you answer to. You need to plan your working hours properly as the clients might demand a lot of your time and attention at times.
As a real estate negotiator, it is essential to equip yourself with self-discipline. There will be months when you do not earn anything, so you must be financially prepared for those times. For example, due to COVID-19, we had to move everything online and it has been very challenging as we work on commission-based. It's been difficult to persuade buyers to participate in online viewings and purchases because most buyers are waiting to see what happens, so we have had to put these deals on hold.
Another issue is that the land office is closed or only open by appointment, causing these transactions to take longer than usual. It also takes longer to make an appointment with KWSP / EPF to take out a down payment because they are booked up until the end of the year.
If you are considering to be a real estate negotiator, make sure to have at least six months to a year’s worth of savings before you start so you can cover your expenses while you wait for your first deal. Since no one else is in charge, you must be self-sufficient and disciplined to achieve your goals.
#3 Is owning a home a necessity?
Certainly not. For some, owning a home provides a safety net and a sense of security. For others, it could be a good investment. If you prefer to rent, that is also fine. First-time house buyers in more developed countries face prohibitively high property prices, forcing them to rent for the rest of their lives. So, if you have the ability to buy a house, I recommend you do so as it would be a good investment for the future.
If you feel strongly about owning a home, have your documentation in order, have sufficient savings, and a steady salary. Do not buy a home under duress (unless the person putting you under duress will also be paying your mortgage!).
#4 What are the factors to consider before buying a house?
First thing that you need to consider is your budget throughout the tenure. Location might be the most important part when choosing a property. Don't pick a house merely because it's on the outskirts of town yet far from your workplace.
Many people make this mistake and wind up spending the following 10 years on the road rather than at home. You may start with a less expensive, closer property, wait for it to appreciate in value, then sell it and use the proceeds to put down on your dream home.
You can start investing on property as soon as you are financially stable. Decide what you plan on doing and how you are going to accomplish it so you can make an informed decision. I started as soon as I was able to apply for a loan, which meant I had all of the required documentation and had completed my research in the previous three to six months.
#5 We always hear of people saying that they will never be able to own a home with how expensive properties are these days. Anything you want to say about this?
There is always a property for you and your budget out there; it's just a matter of shifting your perspective. In the Klang Valley, a landed property cost more than RM600,000. Shift your priorities to an apartment that is more in line with your budget. Even though banks normally set it at 70%, your debt should ideally be 50 to 60% of your income. All other debt is included in the 50 to 60% range, so budget carefully.
Although all properties have increased in value, it is still possible to own one. Property values will continue to rise, so if you're serious about owning, do your research or contact me for some advice, and we'll locate something that fits your budget and requirements.
#6 What kind of mindset should you have when investing in property?
Investing is not always a win-win situation. Due to the current economic scenario, you may not be able to generate a positive cash flow, so you may choose to adjust your goals to repaying at least 70% of your loan and relying on capital appreciation.
Ascertain that you have the necessary entry-level savings, which should be roughly 15% of the SPA price. Thousands more for furnishings and interior design, depending on your preferences, and make sure you understand the additional expenditures, such as maintenance fees and taxes, that come with owning a property.