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Restoring the GREEN in Old Condominiums: A Practical Guide!

Restoring the GREEN in Old Condominiums: A Practical Guide!

May 11, 2013 3:48 am0 comments

Email from a previous attendee of the New England Go Green campaign (back in 2008) –

Hey M!

I have been buying up old real estate (here in Malaysia) to restore before flipping them in the secondary market. And of course, being a green devotee, I would like to take up the CARBON CHALLENGE and turn them into little green monsters! What’s your advice?

Cindy Forbes

Well Cindy!

A lot of homeowners today in Malaysia are looking into buying old condominiums and investing on repairing it. They save up a lot on the down payment and the total cost of the house thereby getting shorter terms on mortgage loans and in some cases, lower monthly fees.

While that sounds very promising, repairing an old condo can be as expensive as building a new one. If you don’t have a lot of money for repairs, you might still end up with a huge construction loan. But if you are creative and innovative enough, you may just be in for some good bargain. I know, because I tried restoring an old Nadi  condo in Bangsar and it really broke my budget trying to go green!

Just as with everything else, there are pros and cons to it so read on if you’re planning to do exactly this for your condo project:

Pros:

  • You can save up on the down payment. While the closing costs are practically the same, these old condos are usually sold much, much cheaply than newer and expensive condos, such as the Park Seven condo in KLCC. These houses have outdated electric and water systems most likely so they would really be very, very inexpensive. Ditto goes for Iskandar region condos.
  • You can save up on mortgage. Your total mortgage loan won’t be as big as when you’re buying a new home. And for obvious reasons. The cheaper the house, the smaller the fees and total costs.
  • They are usually in very good locations. Bangsar, Petaling Jaya, and New Klang all have potential condominiums that are always in demand to the public. Other condo buyers are just not into the hassle of having to work on a condo. They want condos that are ready to live in. There are old condos in good areas that are a turn off for home buyers because they are a lot of work to do. If you invest in them, you get both the condo and the good location.

Cons:

  • They may cost you more than a new condo. Everything in that old condo could be outdated. Most condo buyers are looking for effective green solutions for both houses and condos, and this might be a problem. You’ll have to install new everything – ducts, electricity, water, heating, etc. If your purchase is bad, you might be having problems on sloping, ceiling, pests, and what-nots. You might end up having to tear the whole condo done!
  • You may need a different loan for the repairs. You wouldn’t want double loans right? If you do not have enough savings to cover all the repairs, you may end up having to take a loan on top of your mortgage on the unit.
  • Takes time. It’s practically just like getting a new condo built. You can’t live in it until you have finished all the work in it.
  • Unit restoration is something for the pros and those who are patient enough. Green real estate that are increasing in numbers in certain areas like Mont Kiara and KLCC boasts of facilities that promise little restoration to the owner. This is challenging when looking to buy an old condo unit to restore. Make sure the foundations are still good, and it is not sloping. Also make sure to run a whole pest management thing going – years of it not being lived in made it an ideal place for rodents, termites and all the nasty things in its most hidden nooks and crannies.
  • Before making that final purchase on the old condo, make sure you know what it entails.

Speak soon,

M 😀

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