Condominium Or Serviced Apartment?
While both the serviced apartment and condominium are popular choices among first-time homebuyers, not all of them understand the differences between the two products. A condominium is a high-rise residential building built on residential-titled land, which is exclusively used for private living quarters. Meanwhile, a serviced apartment is built on commercial-titled land and has often been seen as the luxury version of a condominium with more exclusive services and amenities such as concierge and housekeeping.
As commercial-titled lands are used for business activities, most of the serviced apartment projects consist of commercial components such as shop lots, offices, or retail malls. Therefore, serviced apartment projects tend to have more conveniences and amenities than condominiums.
Below are some of the other key differences between serviced apartments and condominiums that you may want to take note of before making your purchase decision:
1. Taxes and assessment charges
Just like the utility bills, the annual parcel rent and assessment charges rates of the land office are based on your property type. As serviced apartments are built on commercial land, both the parcel rent and assessment charges rate are higher than condominiums. According to the latest available data from the Federal Territories Land and Mines Office, the parcel rent rate of a freehold commercial property is at least three times higher than residential.
2. Amenities and conveniences
As mentioned above, most of the serviced apartment projects consist the commercial components such as shop offices or retail malls. Meanwhile, as residential-titled land only for private living quarter purposes, most of the condominiums will not have such conveniences within the project compound.
3. Utility charges
As the serviced apartment is built on commercial-titled land, the electricity, sewage, and water tariff will not be as same as the residential rates charged for condominiums. However, the utility tariffs of serviced apartments are usually lower than the commercial tariff. For example, the electricity tariff rate of a serviced apartment falls under Low Voltage Commercial Tariff, in which the minimum monthly charge is RM7.20, compared to RM3 for Domestic Tariff (condominium) and RM600 for Medium Voltage General Commercial Tariff.
Do not let the higher electric tariff rate scare you away from buying a serviced apartment just yet. If you can prove that your commercial-titled land unit is used as a residence but not for business, you could enjoy the residential rates by submitting your rate conversion application to Tenaga Malaysia Bhd. Here are the steps:
- Apply an account in the myTNB portal.
- In the menu, click “Apply” and then “I want to do something else”.
- From there, click “I want to find out more about other services”.
- You will see the option of “Change my tariff”, click and fill in the online form.
- Submit the form together with your IC copy. You will be required to pay the stamp duty of RM10, which will be reflected in your upcoming bill if the application is successful.
[Image source: House photo created by KamranAydinov]
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