When buying a house, often consumers have the idea that they only need to pay a down payment, take a loan to pay off the rest and cover legal, renovation and moving in costs. However, owning a property is hardly ever so simple.

Here in Malaysia, home owners need to pay several taxes to the government, some insurance coverage fees and some amount to the building management (If you stay in a condominium or apartment).What are these mysterious charges? Here is a list of payments you may have to bear as a homeowner:

Sinking Fund



The Sinking Fund is usually collected by an apartment or condo’s management as a sort of collective savings fund in order to save up for big expenditures. These big expenditures can include a major repainting of the building, replacement or repair of footpaths and corridors, roofing, piping problems, renewing common area fixtures and the like.

Maintenance Fees



Maintenance fees are also paid by those living in shared buildings like condos and apartments. The difference between maintenance fees and sinking fund is that maintenance fees are used for the everyday running of the building management office, like paying employee salaries, paying office expenses, paying building insurance fees, taxes and the like. The rate of both sinking fund and maintenance fees is usually determined by the management.

Property Assessment Tax or Cukai Pintu



Quit rent is actually a tax that home owners pay to their local council. It is collected twice a year, once at the end of February and another time at the end of August. It is usually calculated at 4% (for residential) and 10% (for commercial buildings) of the total annual estimated rental income. For example if your property commands a rental of RM1200 a month, that is RM144 000 a year and 4% of RM 144 000 is RM576, which is broken up into two payments.

Quit rent is used to maintain public amenities in the area or district you stay in, like street lamps, drainage, potholes and the like.

Quit Rent or Cukai Tanah



Quit rent is only applicable to those home owners who have landed property as the tax is payable for the land that your house sits on. For those who live in apartments and condos, the quit rent is paid by the management and is incorporated in your maintenance fees. Individual landed property owners have to pay their own tax at the land office whose rates depend on the local State Government.

Mortgage Insurance



This is actually an insurance you have to pay as an assurance that your property loan from the bank will be paid in full if anything happens to you, like illness, accident or death whereby you cannot work anymore to pay back the loan.

Indah Water Fees



Indah Water is the company in charge of waste and sewerage management and every household that has modern plumbing (meaning your toilets) has to pay a minimal fee each month to make sure that our wastes are processed correctly in a responsible manner. The cost is actually very minimal, ranging from RM6 to RM8 a month depending on your sewerage system.

In House Insurance



In house insurance covers things like fire insurance, householder’s insurance (which covers movable household contents like furniture) and homeowner’s insurance (which covers natural disasters and unexpected accidents in the home). This of course has to be purchased individually.