Banking Secrets Revealed, Why Pay More? Part II. Please refer to my Banking Secrets Revealed, why pay more?
Can the ground that erected your house can fire it down?
When you buy a landed property, be it freehold or leasehold, the housing developer will charges you the land price too. In Malaysia, it is charged based on per square foot or per square meter respectively. Let us say, the land price is valued at RM100,000.00. Do we have to add RM100,000 as part of the sum insured? Can the fire burn the land? Why pay the unnecessary extra premium? Does the insured benefit during the claim?
Don’t be naive, who is the housing developer running on charity build the house without any profit?
What is the profit margin of the housing developer? Perhaps, they add 25 to 60%. It is again all depend on where is the location and the proximity to the city center or the commercial business district. The types of building material, luxury ceramic tiles, type of furnishing, the complexity of the house structure and the quality of or workmanship.
A 3-floor bungalow builds on silt with the steel piling structure will add a substantial building cost than a 3-floor bungalow on a solid flat land.
Do you move into to your new house as where the basis is?
Everybody will love their first home. Can we move into a new house with only the basic house structure being provided by the housing developer? Most people will add iron grilled to their door or window. Some even changed the entire floor tiles front to back with various color or pattern of tiles. More electrical switch point or terminal will install, so do the hot water or solar system and air-conditional.
Not spending a fortune to have extensive renovation.
How much to spend on your first new home renovation?
A rule of the thumb from the expert is about 25% of the house purchase price. It is not worth to spend a fortune up to 50% of the total purchase. It is unwise to burn a hole in your pocket. In Malaysia, people even hired an interior design from design to supervise the project until completion. Some even demolished the all the partition and reconstructed the whole building.
Now the question is
How much to insured the new house? One of the four principles of insurance ” Indemnity” basis come to your mind by now? How do bank being part of the insured when insurer dealing with your claim.
Find out it in my coming next article.
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