Are you a homeowner now? I hope you are.
If not, I would like you to study this lesson thoroughly. One of the best financial decision I made was to buy our first home as soon as I could.
Property value appreciates at least in tandem with the inflation rate. Let’s assume a conservative capital appreciation of 3% per year, coupled with the rental yield of another 3%. Your property can provide a steady 6%.
Moreover, you can use very high leverage up to 9 times – pay 10% down payment and borrow 90% through a mortgage. Meanwhile, the interest rate is low, around 4%. So it is a good idea to own your house as soon as you can.
In this training, I show you the top financial consideration for the first-time homebuyer. Make sure you go through the MADTR in details.
Work alongside my example. By the end of the training, you will be able to estimate quite accurately:
- What is your comfort level of DSR?
- What is your current DSR?
- How much mortgage can you qualify?
- What’s the property price that you can afford comfortably?
- How much cash do you need to prepare?
Discover the following the training:
– How much capital is required for home hunter?
– What are the recurring expenses you need to cater for after owning a home?
– How much is required for the transaction cost?
– How to determine your specific “affordability”?
– How to calculate how much mortgage you can take up?
– What’s the magic formula to own a home without stress?
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Assignment
Post in the comment below: What is the property price that you can afford comfortably?
22 replies to "Top Financial Considerations for First-time Homebuyers"
Hi KCLau, will there be anymore webinars in MP3 format?
HI MOfrust, I stop producing the mp3 format because of not much demand. But do let me know if you consume the mp3 format a let. If yes, I will put it back on.
Yes please 🙂 it allows me to maximize my time while driving to work
Hi KC, is medical insurance is consider under 60% DSR as well?
Insurance is not loan. So it is not counted.
Hi KCLau,
Can I get the excel file from the video?
Thanks
It is a Google Spreadsheet. The sharing link is already embedded below the video. For Premium Webinar Members, please login on the right sidebar to reveal the download link.
Hi KC,
Video not available to see.
Hi KC,
Ops… The video is fine now. Sorry.
No worries. I’m glad that it is working for you.
Hi KC, there are two things I would like to ask according to the video:
Assume:
net income = RM1000
DSR 60% = RM600
1. In the video you suggest to use maximum 30% DSR to pay for mortgage,
the 30% DSR you mean is 30% of net income (RM1000x30%=RM300) or
30% of DSR (RM600x30%= RM180)?
2. In the spreadsheet provided, the accumulated saving after 5 years (D12 in google spreadsheet), is that roughly the amount used to cover all the down payment + recurring fee+ transaction cost + renovation? Because when I calculate, I feel that amount is not enough to cover all unless we exclude the renovation fee.
Thanks KC.
1. The maximum just 30% of net income for your own home installment. If more than that, it will be stressful.
2. The figure in D12 is roughly 25% of the property value.
10% – down payment
5% – transaction cost
10% – for renovation.
Is it adequate?
Thanks KC for your help. I think I will know when I have the ability to buy my first property haha!
RM600k
Hi KC,
May I understand what is the 3% rental return mean? Is it mean a 3%*home value money return we can get annually once we bought a new property? Sorry if I ask a stupid question 😛
Hi Li Sing, the rental return is referring to the property being rented out, and tenant pays rental to stay in the property.
3% rental yield means that if the property market value is RM100k, the total rental collected over a year is RM3000.
Hi KC
If current property on hand is rented out, will rental be included as part of income or to increase DSR in bank’s calculation?
You can show the bankers your latest stamp tenancy, to include your rental income in the DSR calculation.
Thanks KC! Excellent webinar for people looking to buy their first property.
You are welcome
Audio only is not working it is the same mp4 file from video
Thanks for informing. The link is working now.