New rules may burden Penang homeowners looking to sell
Owners of affordable and low-cost homes in Penang will find it tougher to sell their properties as the state government plans to enforce strict rules to curb property speculation.
From Feb 1 next year, owners of affordable homes (bought for below RM400,000 on the island and RM250,000 on the mainland) would be barred from reselling their properties in the first five years of ownership.
Meanwhile, owners of public housing (low and low-medium cost units) bought for RM72,500 or less cannot sell their units for 10 years.
Chief Minister Lim Guan Eng said affordable and public housing owners who wished to sell their units during the moratorium would have to appeal to the state government, and if given the green light, could only sell to qualified “listed buyers” who were registered with the state housing department.
Lim said in a statement that the new rulings would cover past and future purchases.
The new regulations also stipulate that foreigners can only buy property valued at RM1mil or more, and the threshold is increased to RM2mil if it is a landed property on the island.
A three per cent levy would be imposed on properties bought by foreigners, but an exemption would be made if the property is for industrial use, or “promotes employment, education and human talent”, said Lim.
“A two per cent levy will be imposed on the seller, for all properties sold within three years from the date of the Sales & Purchase Agreement signed from Feb 1, 2014. Property bought with the SPA signed before Feb 1, 2014, will not be subject to this levy.
“This two per cent levy is not applicable to affordable housing,” he said.
He said the new housing rules were announced during the tabling of the 2014 state budget at the state assembly sitting but was refined for clarity and certainty during the last Penang state exco meeting.
Meanwhile, Penang Real Estate Housing Developers Association (Rehda) chairman Datuk Jerry Chan said the new rules would limit the pool of property buyers as owners could only sell their units to “qualified buyers” registered with the state housing department.
He said the state government should clarify if this new restriction applied to private property as the change was too drastic.
“It is also not right to impose the new rule on past purchases as these restrictions were not there when purchasers bought the property at that time.
“The new rule will have an impact on the selling price of the property because of the reduced number of purchasers. Changes will have to be undertaken progressively to see the impact,” he said.
Source: StarProperty.my
does this mean that “Affordable” property such as Golden triangle with original price under 300K cannot be sold for 5 years under the new ruling?
One world 1 & 2 in bayan baru may also be affected as it is under 400K
Other properties that be affected by the new ruling
Kelisa residence in seberang prai (early birds under 250K)
Palma laguna in prai
and many condos in butterworth
The 5years/10g years rulling is based on SNP date or vacant date?
S & P Sign date..
@KY
How did you know?
Most of the gov rule will base on signing date which is in tis case is the S & P date, so far i didnt come across any new rules impose by Gov base on vacant date…of course, this is base on my expereince.
So that was only your own presumption….:) The state gov can practically do whatever they want when it comes to land matters, as long as it is for the benefit of the mass middle income people, I think they will get the people’s support….:)
You are right merpati, nowadays the state gov is trying their best to gain Png ppl support they might do wat ever they could.
With the new ruling introduce on those below 400k properties lately, meaning we cant sell withing five years even the S & P being signed in the past…what if i am planning to upgrape my unit from below 400k to 600k, hence i will be stuck in upgrading my unit…does that make sense for a genuine buyer.
one could still sell their “unit” but require to appeal for state gov approval…certainly it will some time for the entire transaction to be completed. Foresee property between 400-600k range would become the up coming hot cake perhaps..
BTW Ah Pek,
base on the write up published, i believe u are right.
does this mean that “Affordable” property such as Golden triangle with original price under 300K cannot be sold for 5 years under the new ruling?
One world 1 & 2 in bayan baru may also be affected as it is under 400K
@Hello
This is just the start, the policy can be tweaked to have optimum effect. Now it is RM400k, it could be RM500k next year, no one knows. If it’s genuine upgrade, I suppose you could get the state’s consent for the upgrade by showing the relevant docs.
Again, this is just the start, execution and enforcement will be the key. We’ll see how effective the state gov is. They need to hire smart people, to out-smart the speculators. With the introduction of various measures, it opens up various possibilities for abuse and corruption too when it comes to state consent. So for your case of an upgrade, a transparent mechanism has to be put in place for the application of exemption….:)
Oh my god. this is going to be a problem for those that purchase the below 400k properties in the past. Believe many agents may face difficulities in the near future, many may quick at the end of the days.
this all project open sell to public no need submit form to apply so not consider affordable property, nowadays u want to buy whatever project new condo 700sf with 350k, u need to submit form as first time buyer, that unit only consider affortable house cant sell in 5 years.
how abt those on the way to upgrade themselves from 300k ++ unit –> 500K ++ unit ? special approval needed to letgo their unit to qualify buyer to sustain their loan for new unit ? limited buyer in the list ?
For those who buy home to speculate, its time for them to be punished. For those who buy home for own stay, there is no such worry. no matter what it is, this is to protect our future generation!!!!
For those who buy home to speculate, its time for them to be punished. For those who buy home for own stay, there is no such worry. no matter what it is, this is to protect our future generation!!!!
read the statement carefully la, the affordable housing 400k mean you have registered with government, not the one you purchased from developer directly. The 1 world, golden triangle are not state gov affordable housing project, therefore no impact.
U are right Merpati, really hope that the gov will do a good job if they have the intention to curb the property price, no more under ” T” kind of approval/transaction pls.
True. How about those units based on new plot ratio guideline? Certain number of units have to sell at 200k max… certain number of units have to sell at 300k max… those are affordable units required by state government for all project…
Any SnP that signed after 1 Feb 2014 under affordable / low cost houses only will be impacted under new rulling. Any SnP signed before this date will not be impacted.
In that case as per what Po mention (under plot ratio guideline, private developer) units selling at price of 200-300k wil be govern by the new rules right ? pls advise…
This is not the correct place to seek accurate information regarding the new policy. Some info given could be right, some could be wrong. Buyers should not rush into signing/buying/selling anything based on hearsay. I believe further clarification would be done by the relevant authority…..:)…Happy Speculating!!
Elmo, seems like regardless of before or after 1 Feb 2014 ..see below :
affordable and public housing owners who wished to sell their units during the moratorium would have to appeal to the state government, and if ……Lim said in a statement that the new rulings would cover past and future purchases.
Ya, need to think twice now and seek for detail clarification before any action taken in near future in any property purchase
since there are many policy coming out that will definitely benefit real buyers and slow down the speculation, all buyers should wait and see. the longer you wait, the more panic the speculators will drop the price. Buyers market is coming up !!!!
5 years holding period regardless of S&P before Feb 1, 2014 or not…
@values
why panic? if no demand then just rent out the units, since they had bought i
As we know affordable home just launch recently, may be refering to LMC units, like harmonyview, the pulse, ,,,
Checked with lawyer.. No applicable anything signed before 1st Feb 2014 for affordable / Low / medium cost only. Private not impacted.
@Po
Just check with the lawyer to ensure what applicable and what type of properties not applicable.
Basically it only impact those low&medium cost flat under government assignment. Private property are not impacted. This is to protect LMC property from being manipulated to resell to poor ppl. So, private property will still remain strong as medium income worker will not eligible for LMC. In fact its very limited with long queue.( Bear in mind there are many low income family with less than 1.5k/month. Even If you alone only 2k/month, you still need to wait slowly for your turn.)
seems like very hard to invest in penang property anymore
anxiously waiting for price drop ….
time to deliver knock-out punch to those ugly, greedy & evil speculators ..
Property price will increase next year.
affordable homes below 400k in island, now 350k 700sf unit for new project consider affordable homes only offer to first time buyer, means that developer still can increase affodable homes price to 399k …zzz
there’s a doctor who own several low-cost flats in penang … all renting out as factory hostels … how a doctor get to own a low-cost flat?!!!
penang property overpriced due to manipulations by unscrupulous greedy speculators , we need price correction ….
time for price drop … coming soon
Better and safer bet if you are planning to buy even a 800 sq. ft. property
is to look for “salary correction” rather than price correction on property.
All these anti speculative measures are introduced in response to the perceived over value of properties in the market. The gov needs to monitor the situation and introduce additional measures if needed. The most important thing is that the gov recognizes that it is not healthy for property price to continue to move up. This is only the beginning….:)…Happy speculating!
@Only Hope
business/ employers may then go bankrupt … n you may end up jobless .. lol
Nowday very difficult to buy a house or apaetment to stay.. the owner of the unit keep on increased their price… more than market value. I encounter the situation when u wanna buy.. the owner increase another 20k. Crazy.. now ia the time that let them felt the consequence. Good for future generation.. I dont wan my child cant stay at the hometown jst bcoz of the property overpriced.
If only government housing are subjected to the new rules, it will be business as usual for all speculators then… except for the 2% levy for S&P stamped after Feb 1 2014…which is not that heavy..
If i could still get an affordable property, it would be miracle. So much people applied for this and endless waiting before one could get a decent unit.
Then again… those who bought new property and thinking of disposing it off within 5 years are more likely speculators/investors…
These measures means nothing to overall property market in Penang. As the transaction volume continue to fall, the property price still continue to increase at a more stable rate. There are more impact from the measures taken by BNM recently, but I still don’t see any significant impact.
@WKT
Don’t wonder the foreigners population is increasing and prospering as
the government is following the same route.
I doubt the property price will reduce in the near future. Property prices in 2014 will either hold/standstill and increase in 2015 due to GST, Fuel and electrical tariff hike. Electrical appliance and house hold price will follow to increase as well.
@Hemsley
Are you suggesting more control measures by the gov are needed?…:)
this no sale rule no impact to whatsoever to private developer projects unless those projects are required to register with government under affordable scheme.
After reading so many write up for it, a bit of confuse that those private sector project which lower than 400 K and bought 2-3 yrs ago. whether are those units affected if transaction make next year & still < 5 years ?
This is not the official gov site for accurate information. It’s all hearsay.
But as far as what’s being reported in the media, it does seem to indicate that our state gov has the intention to do it to all properties within the stipulated price bracket, regardless whether it’s gov housing or private properties.
If you had read TheStar newspaper today, some “legal turban” is threatening lawsuits saying such restrictions are not provided for in national land code. Then again, the state could just circumvent things bu imposing, for example, by imposing a flat “property transfer processing fee” of RM300k for anything within 5 years. That’s probably as good as saying you can’t do any transfer before 5 years…:) Of course, waiver can be obtained for genuine cases as the measures are only targeted at SPECULATORS/FLIPPERS.
As long as the gov does it for the good of the people, for sound economics, they should have nothing to fear for…..:)
@Merpati
No real intention for gov to cool down the property price. The property price now could not be affected by external factors. If BNM increase the OPR next year, this will impact a bit depend on how much to be increased.
@Hemsley
You mean the gov is just pretending to want to cool down the market is it?….:)
@Hemsley
A lot of places around the world are unable to control the price of property
with all the measures taken.
Why not you join the State or Federal government or become a consultant
to give your proposals and implementations that will cool down the property
price.
I hope the government can do their best to avoid property bubble. Nobody wins when bubble happen..
@Suggestion
“….Singapore’s home prices fell at a faster pace in October, dropping 1.2 percent from the previous month as evidence builds that the government’s efforts to cool the property market are working….”
“…..Barclays Plc joined UBS AG (UBSN) and Bank of America Corp. in forecasting a Hong Kong property slump, predicting home prices will fall at least 30 percent by the end of 2015 as income growth stalls and supply increases. …..”
Well, think you have to update yourself more often on what’s going on around the world….:)
@Merpati
You will be buying HK property by end of 2015 then…
@Merpati
That was why I said be a consultant. But why only 1.2 % all these years
or you meant the authority were sleeping on the job ? I think you should
know how much the market value of property in HK prime area. I mean with
all the measures taken why the price of property still went up in the first
place ?
Barclays Plc joined UBS AG (UBSN) and Bank of America Corp.can’t event
predicted the America economic’s crisis back in 2007 ? How reliable are they
in their predictions with so call “professionalism” ?
@Suggestion
You could be right, that’s probably why some are saying “…….a “downward spiral of home prices is likely” as developers and homeowners adjust expectations, analysts Paul Louie and Zita Qin wrote in a report today. They assigned a “negative” rating to the Hong Kong property sector………..”
When property price in penang island going to drop by 20%?
Price of property is not going to drop.
@Q
In 20 yrs time…
Price of property in Penang island is not going to drop.
@Q
You wait long long la….
All the asking of crash here and there….
Such an interesting scenario here. One group who already buy property wanted to see the price continue to go up and up.
While another group who haven’t buy is praying for a crash.
Either way, just becareful of what you wish…
Some who are trying to stop the property frenzy actually own quite a few properties themselves. Well, JD Singh is one example…..:)….cheers!
@Q
It is unlikely to happen in 20% depreciate of property price, i foresee PG property market is heading to healthy direction with new ruling measure in place. we are not at the stage of property bubble.
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