Malaysian banks sometimes hold auctions of distressed property and this should be the first port of call for those considering taking on investments on Malaysian properties or a renovation project in Kota Kinabalu. Many units however, are left to fall in disrepair and wind up on auction due to the fact that buyers were hasty in their purchase and ended up with a unit in a bad location, so this should be taken into account.
Buyers should also bear in mind that although the low-price renovation projects may be appealing, overseas buyers must buy properties with a minimum cost of RM250,000 (about $35,000) in most states of Malaysia.
There are hundreds of renovation firms in the region which can handle extensive renovation works such as masonry, tiling, carpentry and interior design.
As with any restoration project, there is a significant threat that the buyer might bite of more than they can chew and suddenly see development costs for hidden problems spiral out of control. This danger is negated somewhat for those who need financing from banks. Financial institutions will require a report by a valuation firm so that they can ascertain whether the property provides sufficient security for the loan given. It also provides an indication of whether the property is worth what you are paying. The fees depend on the value of the property although are roughly between RM300 to RM800 for a normal apartment.