Notabot

Hello future neighbors,
We will move to Penang next month, and found a lovely place but the unit was being finished. We just got a copy of the tenancy agreement to sign and I'd like to know if this is typical?
It is asking for 2 months deposit, 1 month advance deposit, 1/2 month utility deposit, and another form of our fees which is 1 month for agent commission, agreement fee, and stamp fee, and fee for keys (?!)
First question, is this typical? It is a two year lease, but we have not had to pay the agent commission in any other country before, and found it surprising. We also asked to be able to see the finished unit (which is to be furnished) and are told that we can see it after we pay the advance deposit. I've tried to explain that it feels a bit like we are paying for something and we don't know what we will get. I would probably be okay with getting photos of the planned furnishings. Its a rather high end place, so it feels like it should be well done, but if in the end we're not happy with it, I guess our option is take it or forfeit the deposit. I'm scheduling movers and getting a little nervous - hoping for some input, is this typical for the area? Of course, not currently in Malaysia...

InVinoVeritas

It seems a little heavy to me, but you need to disclose a bit more to get some useful advice - like where it is, how much the rent is etc. Penang rents are pretty negotiable at the moment - too many empty units, too few renters.

JC3

Hi Notabot,


We just got a copy of the tenancy agreement to sign and I'd like to know if this is typical?

It is asking for 2 months deposit, NORMAL

1 month advance deposit, NORMAL, PROVIDED THIS IS ALSO USED AS YOUR FIRST MONTHS RENT

1/2 month utility deposit, NORMAL. BUT CHECK THE RETURN OF ALL DEPOSIT DETAILS CAREFULLY. IDEALLY YOU WANT ANY DEPOSITS RETURNED IN CASH ON THE DAY YOU RETURN THE KEYS / MOVE OUT PROVIDED THAT YOU CAN SHOW RECEIPTS FOR UTILITIES BILLS PAID UP TO DATE, AND/OR CAN THEN AGREE AN AVERAGE RATE PER DAY FOR ANY REMAINING DAYS YOU HAVE NOT YET PAID FOR.

and another form of our fees which is 1 month for agent commission, UNUSUAL UNLESS THE AGENT WAS ENGAGED BY YOU IN WRITING AND THIS IS WHAT YOU AGREED. IF THE AGENT WAS ENGAGED BY THE LANDLORD, THE LANDLORD SHOULD PAY THE AGENT, NOT YOU.

agreement fee, NEGOTIABLE AND SHOULD BE ZERO OR VERY LITTLE – THE AGREEMENT IS USUALLY A TEMPLATE WITH A FEW NEGOTIATED CHANGES.

and stamp fee, NORMAL

and fee for keys (?!) UNUSUAL. THIS SHOULD BE COVERED BY YOUR TWO MONTHS DEPOSIT. IF VERY SMALL AMOUNT PROBABLY NOT WORTH ARGUING ABOUT

It is a two year lease, BE CAREFUL. I WOULD PREFER A ONE YEAR (FIXED TERM) LEASE WITH AN OPTION TO RENEW FOR A SECOND YEAR. IF YOU HATE THE PLACE, OR DISCOVER SOMETHING UNPLEASANT YOU DIDNT KNOW ABOUT BEFORE YOU MOVED IN, YOU ARE LOCKED IN. FOR A MINIMUM TWO YEAR LEASE I WOULD DEFINITELY WANT A RENT REDUCTION IN RETURN.

We also asked to be able to see the finished unit (which is to be furnished) and are told that we can see it after we pay the advance deposit. ALARM BELLS.

===========

Here’s a few things to think about. There is a vast over-supply of condos for rent in Penang. Good expat tenants are like gold dust. This means you hold the cards (the cash) and should be able to:

• Negotiate a 20-40% rent reduction
• Put in an early exit clause e.g. allowing you to leave at the end of Month 6, with two months advance notice, if during months 1-4 you find any significant problems with the property such as noisy neighbours, termites, construction in the building or nearby, leaks etc. 'Hacking' by neighbours in a new property is very common and could make your life hell. Also in some condos the windows are not properly sealed leading to flooding in your condo every time there is heavy rain.
• Put in a clause stating that the landlord (not you) will pay for any electrical problems with fans, aircons, fridge freezer, oven, washing machine etc provided by the landlord – and/or that you can deduct any repair costs from the monthly rent (with receipts).
• Check the agreement carefully for when exactly the landlord can show new prospective tenants the property. I suggest this should only be during the last one or two months of your occupancy, only with 48 hours notice to you and if convenient, and only between 9am and 5pm. If there is nothing stated, write it into the agreement now, you will be glad you did.
• Put in a clause get the landlord to pay for a pest control contract - ants, cockroaches, termites etc.
• etc, etc
  

I’ve written an article on this forum about negotiating a rental agreement, that might help you a little. Do a search for ‘negotiate’ to find it.
From what you have said, I believe your landlord is trying to have his cake and eat it, and I suggest you are very wary, especially with regards to any delays in getting your deposit returned.

Very often in Penang expats move to a better cheaper property in Year 2, once they discover they’ve overpaid the first time round, having been taken advantage of as a ‘newbie’.

Frankly, I’d politely ask your landlord for all the above and a rent reduction if you haven’t negotiated one, and suggest politely to the landlord that you will walk away if you don’t get what you want – there’s always another condo.

If you name your condo on this forum, other members may be able to tell you any pros and cons.

Don't be frightened to walk away from this deal. You can always rent an apartment here for a few weeks first and look for something else.

Good luck!

JC3

Notabot

Thank you for the input. It's all very helpful. The condo is 1 Tanjong, seems new so anticipate few issues but I cannot plunk down cash without seeing the whole thing.
We've said we'd wait and keep looking. All other prospects were very flexible so maybe another will come along.
We could literally fly over for half a day tomorrow from Singapore to look but then traveling for few weeks before the move so a bit anxious. We had no agreement verbal or written with the agent. Thinking we should perhaps try another agent. Any recommendations welcomed.

bakedbean

Sounds like Alarm bells to me too. You really need to see the place in it's finished state, don't you.

That's a very new condo. I didn't know folks were moving in yet. You can be sure of plenty of renovation noise. Of course there are pros to new condos too, and it's in a nice location.

As JC3 said, it's a renter's market. If you're only down in Singapore, better to come up and find a finished place. Surely getting the new home right is more important than travelling.

Notabot

Thanks BB, seeing what we can arrange, not sure how much we can see in part of a day

We have looked at many places, and liked the idea of sea view; I was hoping for something older but renovated. We were shown many older, but nothing renovated on the other end of Gurney. Looked at a few further south but they felt a bit isolated (Light collection) Some feel like there will be ongoing construction in the area for awhile (Straits Quay), Another was ok except we were hoping for a balcony (Gurney Beach) And Mr requires a pretty good size pool.

Anyway, worst case, I can be back to Penang near the end of the month with high hopes that we find something thats available before our things arrive.

If anyone here would recommend a place, I am happy for suggestions from people who are already living in Penang, or an agent thats been good to work with. In the end, I'm sure whatever we find will be workable, and we can certainly get a lot more value in Penang as compared to Singapore.

JC3

Hi Notabot,

Hmmm, I think if you are still thinking about 1 Tanjung or The Cove (the next door condominium) in Tanjung Bungah, Penang, you might want to find out about the redevelopment plans for the nearby Copthorne Orchid hotel, and protect yourself in case the redevelopment happens.

Last year, I read that the Copthorne maybe be redeveloped as a hotel cum serviced-suite project, and that Millennium & Copthorne Hotels, the operator and owner of the Copthorne, Millennium, and Kingsgate hotels worldwide, had engaged consultants and architects to explore plans and design for the redevelopment.

It would be sods law to sign a two year tenancy agreement and move in to your condo, only to find you are next door to a building site for the next two years and locked-in to your agreement. Hence the importance of getting the early exit-clause (in the event of non-disclosed surprises, or unknown about ones) I mentioned earlier, written into any tenancy agreement.

JC3

bakedbean

If you liked Straits Quay, I wouldn't totally rule it out. If you are careful, some of Quayside units have great sea views and there's no construction or anything happening on that side, as far as I know. (You can check with a good property agent.) And great facilities for swimming etc. It depends what you want of course. There will be a load of offshore stuff going on in the sea direction towards Gurney.

Yes I know what you mean about The Light. Great long swimming pool but not too much else over that way currently.

Notabot

I don't know anything about more development (and really, how much more building can Penang support)

More helpful information. Thank you!!!

Gunnar45

It looks like there are plans to build just about everywhere in Penang!
Even on land to be reclaimed from the mudflats outside Gurney Drive.
So, almost wherever you go for a long term rental, you will risk to end up with construction sites nearby.
As others have pointed out, maybe it is better to go for one year at a time?

SushiFan

My wife and I visited Tj. Tokong in September on a house hunting tour (more a condo hunting tour). In three days I visited approximately 20 condo's. We had made arrangements with some 4 agents and each of them showed us on average 5 condo's in half a day. All condo's were existing and furnished ones. I wouldn't exaggerate if I tell you that we didn't like the furniture in at least 15 of the visited condo's. So I would be very careful in signing some contract without having seen the condo in a furnished state. But then, our opinion about furniture could be weird....

kebi

It is really quite difficult to find an apartment where you safely can enjoy a noise free stay for several years. Although I’m active in this field I got burnt twice within one year. First I stayed in The Peak - very high floor - and overlooked Georgetown till the 2nd bridge and Mount Bintang on the main land. After a couple of month they started a 40 story development next to it and got the permission the work till 10 pm. After I moved out I noticed that they demolished all the houses in front of The Peak and are building now another 40 story tower which also effects Latitude.

By moving to Surin I was aware that I will hear the short calls for the prayers from the Floating Mosque which is part of Malaysia for me. What I did not expect is that lately sometimes every part of the ceremony is broadcasted by speakers and can last for several hours.

Through my other business I have been in many condos and the only currently really noise free and save from next door future developments in my opinion are in Tanjung Bungah area: Sea Range Tower, Sea View Garden, Infinity, 1 Tanjung, Sri Golden Bay and Springtide.

bakedbean

You can never be noise free here.

We looked at Sri Golden Bay. It's very nice. Would recommend. But you do get a lot of road noise at the front of the building. And it is very dog friendly it seems....we heard plenty of barking when we looked at units there.

Then there's renovation noise.

You can't get away from noise in Penang. Just pick the noise that you are happy with. Mosque noise is not so bad once you get used to it. Think I'd prefer mosque noise to yappy dogs.

If you want noise free, better to buy a detached house somewhere in the middle of nowhere. But then you don't get all the infrastructure and facilities that you need in retirement (for those retired). There is nowhere perfect.

InVinoVeritas

Which has a low cost of living.

owned

I don't get any noise at my place and it should always be like that as there is no where to build.

But as IVV pointed out if you want serenity get ya cheque book out.