Archive for the ‘Property News’ Category

Penang’s New Housing Rules Effective 1 February 2014

December 19th, 2013 39 comments

UPDATE: The new housing rules announced in the 2014 Penang state Budget approved at the Penang State Assembly and proposed to be effective from 1 February 2014 are designed to protect Penang from being adversely affected by a property bubble as well as ensuring that public housing and affordable housing are bought by genuine purchasers who are qualified first time buyers from lower and middle-income groups.

Public housing are low-cost houses up to RM42,000 and low-medium cost houses from RM72,500 to RM400,000 on the island and from RM72,500 to RM250,000 on the Seberang.

As a responsible government seeking sustainable economic growth and development, the Penang state government is careful to avoid the pitfalls of any property bubble that will bring hardship to the rakyat and damage the economy. Japan is a good lesson of the dangers of a property bubble. These housing rules were discussed with stakeholders especially those from the property industry who had objected to them.

The state government has set up a RM500 million Public Housing And Affordable Housing Fund to build 20,000 units of public housing and affordable housing in all 5 districts of Penang. This is the largest amount set aside by any state government in Malaysian history to build affordable and public housing. Naturally, these new rules are necessary as the state government is concerned that first-time buyers may not be given the first opportunity to buy them and reduce exploitation for speculative gain.

104 Units of Shared Ownership Scheme (SOS) & 51 Units of Rent-Buy Scheme

Further the State Government would also implement Malaysia’s first ever Shared Ownership Scheme(SOS), a historic joint purchase initiative between the state government and poor purchasers, for those who just miss out on getting a 90% or 100% bank loan, by offering a 30% interest-free loan from the state government whilst they need to borrow the remaining 70% from banks instead of a 90% or 100% bank loan. 104 units of low-cost houses in Taman Sungai Duri, Seberang Perai Selatan will be the pilot scheme for SOS. The State Government would also implement a “rent-buy scheme” of 51 units in Taman Seruling Emas Flats, Seberang Perai Selatan for the poor who are unqualified to obtain any bank loans or where banks refuse to lend any amount of loans to them.

As a people-centric government, the Penang state government wants to achieve housing democracy that allows every working family to own their own homes. Ensuring that public housing (low cost and low medium cost houses) is owned by the poor and genuine first time buyers is our priority. The state government is committed to assisting first-time buyers to have the opportunity to buy affordable homes and is willing to accept any criticism or face any legal challenges by those who oppose this commitment, whether from NGOs or BN.

The Penang state EXCO had during its last meeting refined the new housing rules for clarity and certainty as follows:

1. Public Housing – Low Cost And Low Medium Cost Housing

All low cost homes (up to RM42,000) and low-medium cost homes(up to RM72,500) purchased cannot be sold for 10 years from the date of Sale and Purchase Agreement. Those who wish to sell during the first 10 years must appeal to the state government and can only be sold to “listed buyers”. The price transacted will not be set by the state government but will be on a “willing buyer, willing seller” basis by both the “listed buyer” and the seller. Listed buyers are those who have registered with the Housing Department of the state government and are certified as low income groups that are qualified to purchase low-cost or low-medium cost housing. This 10 year rule will cover all past and future purchases. The balloting of houses will be subject to oversight by an auditing firm, the first time this is done by any state government in Malaysia.

2. Affordable Housing

Affordable housing is classified as houses which were initially purchased below RM400,000 on the island and RM 250,000 on the mainland. Affordable housing purchased can not be sold for for a period of 5 years from date of Sales and Purchase Agreement. Those who wish to sell during the first 5 years must appeal to the state government and can only be sold to “listed buyers”. The price transacted will not be set by the state government but will be on a “willing buyer, willing seller” basis by both the “listed buyer” and the seller. “Listed buyers” are those who have registered with the Housing Department of the state government and are certified as middle-income groups that are qualified to purchase affordable housing. This 5 year rule will only cover all properties transacted on or after 1 February 2014. In other words it will not be retrospective but affect only Sales and Purchase Agreement signed on or after 1 February 2014.

3. Purchases By Non-Citizens

Non-citizens can only purchase properties in Penang in excess of RM1 million and for landed property on the island must exceed RM2 million. All purchases of properties by non-residents will be subject to a 3% levy on the transacted price for Sales and Purchase Agreement signed on or after 1 February 2014. Exemptions are provided for purchases for industry purposes or for a purpose that promotes employment, education, human talent or promoting Penang as an international and intelligent city.

4. 2% Levy On Property Purchased After 1.2.2014 Sold Within 3 Years

A 2% levy will be imposed on the seller for all property sold within 3 years from the date of the Sales & Purchase Agreement(SPA) signed from 1 February 2014. In other words, this is not retrospective. Properties bought with the SPA signed before 1 February 2014 will not be subject to this levy. Only properties bought with the SPA on or after 1 February 2014 will be subject to the 2% levy if sold within 3 years. This 2% levy is not applicable to affordable housing.

Active discussions are continuing with the Bar Council, banks, property developers both in and outside Penang as well as other associations to brief them on the new housing rules which are in force for SPA signed on or after 1 February 2014 , except for low-cost or low-medium cost housing.

Source: Buletin Mutiara

Categories: Property News Tags:

Penang ready to increase quantum of Affordable Housing Fund

December 16th, 2013 8 comments

An artist’s impression of the proposed affordable housing project at Kampung Jawa, Butterworth, Penang.

The Penang government is prepared to increase the RM500mil Public and Affordable Housing Fund if it is not sufficient to build 20,000 housing units in all five districts in the state.

Chief Minister Lim Guan Eng said that despite not receiving any funding from the Federal Government, it was able to set up the largest housing fund in Malaysian history by any state government.

“The RM500mil fund is a testimony of a clean government and integrity in leadership,” Lim said in a statement yesterday.

He said the 30,000 people who registered with the state Housing Department should receive the application forms within a week.

“The state government needs to know how many are interested so that we can plan and be assured that there will be sufficient buyers for the 20,000 units,” he added.

Among the 10 locations for the public housing projects are Jalan S.P. Chelliah, Teluk Kumbar, Jelutong and Pintasan Cecil on the island and in Batu Kawan, Kampung Jawa, Mak Mandin, Ampang Jajar, Bukit Mertajam and Juru on the mainland.

Meanwhile, state Housing, Town and Country Planning Committee chairman Jagdeep Singh Deo has urged the Urban Wellbeing, Housing and Local Government Ministry to respond to their enquiry on the proposed PR1MA affordable housing schemes in Penang.

“We have our affordable housing projects and we need a response from the Federal Government on their PR1MA housing projects,” Jagdeep said at a press conference after presenting school uniform vouchers to 100 primary students in Datuk Keramat yesterday.

PR1MA is an affordable housing scheme in key urban areas for Malaysian citizens earning between RM2,500 and RM7,000 monthly.


Categories: Property News Tags:

Second Penang bridge expected to open in February

December 13th, 2013 12 comments

The second Penang bridge, which is now 99.9% completed, is expected to be opened to the public in February, said Works Minister Datuk Fadillah Yusof.

“Only the construction of two toll plazas in Batu Kawan – one at the Bandar Cassia interchange and the other at the interchange connecting to the North-South Expressway (NSE) – is yet to be completed.

“Upon completion, the 28-booth toll plaza in Bandar Cassia will be the largest in the country,” he told a press conference at the China Harbour Engineering Co Ltd (M) Sdn Bhd office in Batu Maung here.

Currently, the Sungai Besi toll plaza is the largest one in the country with over 18 lanes.

The Bandar Cassia toll plaza (PB2X Toll Plaza) will be managed by Jambatan Kedua Sdn Bhd. NSE operator PLUS Expressway Bhd will operate the other one (PLUS Toll Plaza).

“The PB2X Toll Plaza is meant for motorists who are not using the NSE, especially the locals who want to commute to the island from the Batu Kawan area. After the construction is done, we have to integrate the system with other highways such as the NSE,” Fadillah said.

He added that the bridge would be opened to the public only after it met requirements set by the Malaysian Highway Authority.

On talk that toll rates would be increased next year, he said they were subject to review every three to five years and added that the toll rates for the bridge were still at the negotiation stage.

“We have a total of 29 tolled highways in the country and the concession agreements vary.

“For example, the NSE is due to be reviewed in 2016,” he said, adding that a few highway tolls would be reviewed next year and the incremental rate would depend on the Federal Government, which would take into account its financial position and the people’s economic situation.

The second Penang bridge, spanning 24km with 16.9km over the sea, is expected to ease at least 25% of traffic congestion on Penang Bridge.


Categories: Property News Tags:

Penang pushes ahead with property ruling despite criticisms

December 12th, 2013 13 comments

State Housing, Town and Country Planning committee chairman Jagdeep Singh Deo.

GEORGE TOWN: The Penang government is standing firm with its new ruling on property sale even as critics slam it, saying the ruling is illegal.

State Housing, Town and Country Planning committee chairman Jagdeep Singh Deo said the state controls the land office, so with land being a state matter, it has the mechanism to impose restrictions on property sale.

“In order for a person to own a property, he must get it registered at the land office.

“Under the ruling, we can impose a 2% levy, on top of the existing 0.1% stipulated for transfer of land title,” he said on the sidelines of the state assembly meeting here yesterday.

Several groups, including Gerakan and MCA, have taken the state government to task over the new ruling that it plans to enforce from Feb 1 next year, saying it would be illegal as the National Land Code needs to be revised first before the ruling can be enacted.

“Currently, the application fee for any transaction pertaining to a leasehold property is 0.1% of the selling price,” said Jagdeep.

“As for freehold property, the seller will have to produce a statutory declaration that they have indeed paid the 2% levy before the transfer of land title can take place,” he said, adding that the new ruling would only affect property bought with sales and purchase agreements signed from February.

Jagdeep said the restriction would be imposed on properties priced above RM250,000 in Seberang Prai and above RM400,000 on Penang Island sold within three years of being purchased.

Chief Minister Lim Guan Eng also brushed off criticisms.

“We have been subjected to criticisms from the Consumer Association of Penang and Gerakan. At first they criticised the state government for not doing anything to help. When we try to help, they attack us. So, what do you want us to do?” he asked at a press conference yesterday.

Several groups have come to the defence of the state government, saying the ruling would curb speculation.


Categories: Property News Tags:

Land prices in Penang likely to rise next year

December 11th, 2013 19 comments

A LAND valuation of RM1,200 per sq ft for 44.5ha of reclaimed land in Penang by the state government is being used as a point of reference for land transactions, claims the Real Estate and Housing Developers Association (Rehda).

The association’s Penang chairman Datuk Jerry Chan said yesterday land prices in the state are expected to rise next year.

This is partly due to the government’s move of pegging land value so high in relation to the swap deal with Consortium Zenith BUCG, the developer of the proposed RM6.3 billion undersea tunnel and three highways.

The deal involves land starting from Tanjung Tokong to the sea-fronting Persiaran Gurney, which has been tagged at RM1,200 per sq ft, since the state does not intend to pay the developer for the multi-billion ringgit projects.

Stating that the said deal will now be the yardstick for land owners and developers when fixing prices on their properties, Chan said: “If the state takes that kind of valuation, what do you think other land owners and developers will do?

“And remember that the project construction cost (RM6.3 billion) was from six months ago, which has not taken into account additional costs due to the higher electricity tariff and the goods and services tax (GST). If costs goes up, so will property prices,” he said at IJM Land Bhd’s office.

Present was IJM Land northern region general manager Toh Chin Leong.

Chan said while Penang can expect to see fewer property projects launched in 2014, prices will not come down.

This, he said, is because banks and investors are already cautious about the property market.

Penang is unlikely to see any property bubble as the property market remains healthy, he said.

“We, however, need time to determine how some of the measures imposed by the Federal Government via 2014 Budget and the state government will affect the market.”

Toh said property prices in Penang are on the rise due to various factors, including increased higher compliances cost, which has been increasing in the past four years.

“Cost contributions have increased three-fold as they now have to pay the government a default compensation of RM120,00 for each low-cost housing unit they did not incorporate into their project.

Developers also have to obtain a housing development licence by paying a deposit of three per cent of their project’s estimated cost to show they have sufficient financial ability to begin building properties.

Source: Business Times

Categories: Property News Tags: