July 4, 2011

Property transaction in Malaysia - Part 3

Highrise during a sunrise
As a continuation from my previous post about how purchasers of property in Malaysia purchase a property with title in cash, here is an infographic on how a buyer of a property in Malaysia purchase a property without title (such as condominium, apartment, land which is still hasn't been subdivided, to name a few). Both blogposts still deal with the purchase from a housing developer (in contrast if it is a subsale, where you buy a property through the secondary market) :

HOW DO YOU SUMMARISE

PURCHASE OF PROPERTY WITHOUT TITLE

FROM A HOUSING DEVELOPER USING CASH


Purchaser pay 10% purchase price and sign Sale & Purchase Agreement
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Housing Developer signs
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Lawyer stamps the agreement and gives each party a copy of the agreement. Original copy should be handed over to the Purchaser
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Property is constructed according to the description of the property as provided in the Sale & Purchase Agreement. With each completion of the construction according to the Third Schedule of the Sale & Purchase Agreement, the Housing Developer will send a certification from his architect showing proof as such and request for payment to be made.
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Purchaser makes payment according to the progress claims send by the developer where the Purchaser has 14 days to do as such which can result in interest accrued if payment is late.
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Within 36 months, construction must be completed. This includes the common facilities as listed in Second Schedule of the Sale & Purchase Agreement
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When the property’s construction is 92.5% complete, upon fulfilling Clause 25 and 26 of the Sale & Purchase Agreement, vacant possession is given to the Purchaser and the Housing Developer can request for another payment to be made. Purchaser can now move in into his new property
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Housing Developer must submit an application to the appropriate authority for an application to subdivide the said land or building and show written proof to the Purchaser of such application and acceptance. Payment of 2.5% of the property can then be made by the Purchaser.
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The warranty period for the property will last for 36 months but payment of the final balance purchase price of 5% must be made to the lawyers appointed by the Housing Developer as the stakeholder for the payment. Within this period, claim for any defect on the property and common facilities can be made and paid for by this stakeholder money as provided under Clause 25 of the Sale & Purchase Agreement
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Housing Developer must have at this point, at their own cost and expense, as expeditiously as possible, apply for subdivision of the property into parcels and obtain a separate strata title under the Strata Titles Act 1985

2 comments:

Spectre said...

Great info indeed. What happen if the developer already folded ? can the transaction continues

kruel74 said...

The transaction can continue with the Official Assignee (Government Bankruptcy Office) taking over the role of the housing developer. This is different if the development is abandon but the developer did not become a bankrupt

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