PETALING JAYA: To promote home ownership among Malaysians, the Government has proposed to introduce First Home Scheme whereby Cagamas Bhd will provide a guarantee on the 10% down-payment for houses priced below RM220,000.

The scheme is for first-time house buyers with monthly household income of less than RM3,000. It is aimed at young adults who have just joined the workforce.

With the guarantee from the national mortgage corporation, it means that eligible house buyers will be able to obtain a 100% loan.

First-time house buyers will also be given stamp duty exemption of 50% on instruments of transfer on a house priced at not more than RM350,000. The Government has also proposed stamp duty exemption of 50% be given on loan agreement instruments to finance such first-time purchase of houses.

To expedite the process of property registration, the Stamp Act 1949 had been amended to enable the Valuation and Property Services Department assess properties after the payment of stamp duty to the Inland Revenue Board. This will reduce the property registration process from 30 days to one day.

Welcoming the First Home Scheme initiative, Real Estate and Housing Developers Association (Rehda) deputy president Datuk FD Iskandar Mohamed Mansor said the scheme was good news for the housing sector, “as just over 73% of houses transacted falls under the category of below RM220,000.”

The 50% stamp duty exemption for houses below RM350,000 covers an estimated additional 10% of the market, and together the incentives benefit all-in-all roughly 87% of housing transactions throughout the country.

While Rehda views the measure as a very positive step towards closing the income gap, it acknowledges that properties which are found within these price brackets are not easily found in Greater KL or Penang due to higher land and construction costs in these vicinities.

Concurring with Rehda, C H Williams Talhar & Wong Sdn Bhd managing director Foo Gee Jen expects the First Home Scheme to have a lesser impact on the Kuala Lumpur market as the prices of most houses here exceeded the ceiling set by the budget.

“There will be more significant impact on housing demand in other cities such as Johor Baru, Malacca, Ipoh, and Kuantan,” he noted.

Reapfield Properties Sdn Bhd managing director David Ong said the Government’s “invisible hand” in steering the housing market was important in the light of the current market conditions.

“The Government is wielding its influence on two fronts – to help first time buyers and to signal to developers that a certain type of housing within a certain price range is needed. Developers can probably consider townhouses or condominiums within a certain price range,” Ong said.

Ong said hopefully, with this move, developers would build houses within this pricing category.

Khong & Jaafar managing director Elvin Fernandez said the Government’s move not only recognised first-time house buyers, “but also acknowledged them as newcomers into the workforce.”

“The perimeters set out in the budget are correct. This is the type of house this group will be able to afford. They will need this kind of assistance,” he said.

The move, he said, did not mean that the Government was not considering raising the downpayment for house purchase to 20% or 30%.

“That may still come later on as increasing the percentage of downpayment does not fall within the budget,” Fernandez said.

Ireka Development Management Sdn Bhd chief operating officer Lim Ech Chan said the First Home Scheme would enable first-time buyers to afford their first home and promote a healthy property market overall, encouraging more affordable housing to be made available.

Amphil Corp Sdn Bhd chief executive officer PK Poh said it was an excellent measure to provide the means for young households to purchase “starter” homes “as it will be a sort of forced savings and a hedge against inflation, besides saving money on rental.”

“In our major cities, this would often mean buying small one- or two-room apartments in areas a little further from their workplace than they might like. However, the securing of such a loan is still subject to the banker’s determination of the repayment ability of the borrowers.”

On the development of the 1,072ha Malaysian Rubber Board land in Sungai Buloh by the Employees Provident Fund, Poh said most developers were looking forward to the finalisation of the master plan and the granting of conversion and planning approval from the state.

“The land area comprises both freehold and leasehold lands and needless to say, developers would want to see how they could position themselves and participate in the roll-out of this massive development,” he added.

The mixed development comprising affordable houses as well as commercial, industrial and infrastructure facilities, is estimated at RM10bil and is expected to be completed by 2025.

SOURCE: The Star

AFTER undergoing a RM5mil conservation work, a budget hotel has been transformed into a cosy boutique hotel with excellent amenities in the heart of George Town, Penang.

Exuding a historic charm for those seeking to relax in a place of rich culture, the newly restored Yeng Keng Hotel on Chulia Street appears to take guests back to over 150 years ago when the building was first built.

As one walks down the corridors of this historic hotel, one cannot help but admire the vintage furniture and lime washed walls decorated with colourful works of art, including batik paintings.

Conservation and upgrading works began last year by the current owner, Hoo Kim Properties Sdn Bhd, and were completed in April.

Kim Com-pany Sdn Bhd and Kim Mansions Sdn Bhd managing director Datuk Ong Gim Huat spoke of a colourful history linked to the building that was originally a private residence built in the mid-1800s.

He said it was an Anglo-Indian bungalow, which was bought by an Indian Muslim family, but was sold to a group of Chinese businessmen who were trustees of the Cantonese Club ‘Yin Han Pit Shu’ in 1897.

Ong said they bought the building on behalf of the association and it was later donated to the trustees of the Straits Chinese British Association in 1939.

“In the early 1900s, the building was leased to another person who set up Yeng Keng Hotel. The traditional Chinese arch at the entrance was then constructed to add grandeur to it,” he said.

In 1985, the land for the budget hotel was bought over by Ong’s father. The hotel stopped operating in 2009 and its business was subsequently handed over to Ong.

“We wanted to restore the building to its original form apart from turning it into a friendly, homely sort of resort right in the middle of a heritage city,” he said.

Ong added that they engaged architect Laurence Loh, who restored the Cheong Fatt Tze Mansion on Leith Street, to help retain the building as much as they could.

“We did our utmost best to restore it like the original as well as making it modern and livable,” he said, adding that they even roped in skilled craftsmen from China to help with the restoration.

The 20-room hotel, which opened in June, has a small bar, garden, swimming pool and car park. Wi-fi service is also available while its newly opened kitchen will soon serve Hainanese, Chinese and Western food.

The hotel is located at 362, Chulia Street and can be contacted at 04-2622177.

SOURCE: The Star

MALAYSIA Land Properties Sdn Bhd (Mayland) aims to launch its maiden project in Penang, a high-end seafront mixed development worth more than RM2 billion by 2013.

The company is looking at buying 12ha in Penang island, some of which will include reclaimed land, said its director Andrew Chiu.

"We want to lay something like a corner stone development in Penang. We hope to get the land within the next 12 to 18 months," Chiu said in an interview with Business Times in Kuala Lumpur recently.

Chiu said the Penang project will be something like the company's on-going integrated Plaza Damas development in Sri Hartamas, Kuala Lumpur, which started in 1998.

Mayland – founded by Chiu's father, Tan Sri David Chiu, a Hong Kong-based hotelier and property developer is focused currently on developments in the Klang Valley and Johor.

It is looking to launch several new projects and sub-phases within its existing developments.

By end-December, it will launch Elements, a 50:50 joint venture project located off Jalan Ampang, Kuala Lumpur, with Land & General (L&G) Bhd, a company which is about 20 per cent controlled by the senior Chiu.

The RM800 million project will comprise 1,040 units of high-end serviced apartments, each pegged at more than RM800 per sq ft.

In Johor, Mayland plans to launch the final phase of its RM300 million Palazio serviced apartment project in Mount Austin.

The entire project has six 14 to 21 storey residential towers, with a total of 1,828 units. The first four towers, launched in 2009 and early this year, are almost 90 per cent sold, Chiu said.

In the first half of 2011, Mayland will launch projects worth in excess of RM2 billion, starting with a residential development in Pelentong, Johor Baru.

Chiu said the project will have 3,000 serviced apartments in five blocks, worth almost RM1 billion.

In Country Heights Damansara, Mayland will launch 300 units of serviced apartments and 250 townhouses, on 4ha, for RM800 million.

"I feel we are at a beginning of a bullish market and I am confident that most of our projects will sell well under this circumstances.

"We have many repeat buyers, who have experienced our projects appreciating in value by more than 100 per cent. We don't just want to sell a property, but a dream … a lifestyle," Chiu said.

Mayland still has 120ha of undeveloped land in the Klang Valley and 20ha in Johor. It is looking for more land to buy in Kuala Lumpur and Penang, he said.

SOURCE: Business Times

The Government is expected to adopt tighter regulations in the 2011 Budget to curb potential dangerous run-up in consumer credit card spending and speculative activities in the property market.

“We believe Bank Negara Malaysia (BNM) is focusing on tackling household debt in 2011 to promote healthy credit card spending,” said Kenanga Research.

In its 2011 “Wish List”, Kenanga said the central bank should consider imposing tighter borrowing limit for the property sector to avert potential over-leveraging on the household segment and speculations.

It said bank loans should be lowered to between 70 and 80 per cent value ratio for third mortgage, it said.

Bank Negara should also consider capping maximum of two mortgages for each borrower, it said, adding that such a rule would slow down housing price appreciation rate, going forward.

Should tighter borrowing rules be enforced in 2011, it would not have any impact on loan growth this year as borrowings are anticipated to remain strong till year-end, it said.

“But we are cautiously optimistic on business loans as businesses in the next six months may be negatively impacted by global economic turmoil and Malaysia''s economy is not immuned from moderating global growth,” it said.

The research house said it was cautious for the second half of this year due to healthy loan growth but increasing risk on slower growth in the business segment, namely manufacturing and exports.

"Profit margin squeeze is directly triggered by the wave of intensely- competitive pricing, moderate growth expectation and possibility of a slowdown on mortgages if 70 per cent to 80 per cent loan-to-value ratio (LVR) is implemented.

“We see the implementation of a blanket 70 per cent to 80 per cent LVR cap as a real challenge to the industry's loan growth next year and could put pressure on retail banks,” it said.

However, strong asset quality suggested lower credit charge-off, going forward, compensating net profit for the lower top line growth, it said.

As for credit cards, Kenanga said new measures should see tougher limits on the number of cards a person could hold and lower credit limit on each card.

Bank Negara should restrict a consumer to own only two credit cards from two banks of their choice and allow people with an annual income of above RM24,000 to own a credit card from the current minimum requirement of RM18,000.

The central bank should also reduce spending limit by 1.5 times their monthly salary (currently 2.5-3.0 times), set at the bank’s discretion for first-time applicants.

“In our view, stricter credit card rules are prudent and limit the risk of rising household non-performing loans. It will curb spending-spree cultures that have surfaced in certain segments of the population recently,” it added. — Bernama

SOURCE: Business Times

PJ Development Holdings Bhd (PJD) (1945) is set to unveil three new projects worth over RM2 billion next year as it is bullish that market will perform better on pent-up demand for high-end properties.

Managing director Wong Ah Chiew said he is confident that the new projects, located in hot spots like Sri Hartamas, Cheras and Kuantan, Pahang, will do well.

This year, PJD did not launch any new projects except for sub-phases in existing developments because of uncertainties in the market.

The company has five on-going projects, lasting it for the next five years. They are Swiss-Garden Residences at Jalan Pudu, Kuala Lumpur, Taman Putri Kulai and Mont' Callista in Johor, Taman Bukit Istana in Kuantan, and Ocean View in Butterworth, Penang.
"These projects have been selling well. For instance, Ocean View, a condominium development, is 80 per cent sold. We have a number of enquiries for new projects and that is why we are launching," Wong said.

In Sri Hartamas, PJD will launch Dutamas Kingsbury, located near Solaris, the bustling commercial centre of Mont' Kiara, by early next year.

Dutamas Kingsbury boasts over 200 condominium units, each with built-up of more than 2,000 sq ft, priced from RM650 per sq ft, and some 60 units of three-storey super link homes, with over 3,000 sq ft in built-up area, selling from RM3 million.

"Demand and choice are there and availability of land is scarce in the Mont' Kiara area. So we hope there will be good take-up," Wong said after the company's extraordinary general meeting in Kuala Lumpur yesterday.

In Cheras, PJD plans to launch an integrated development featuring retail lots, shopoffices, a mall and high-rise serviced apartments, by mid-2011.

Wong said the best project will be the resort-style development at Sg Karang in Kuantan, located close to Swiss-Garden Resort & Spa Kuantan.

The project, which is targeted for launch in the second half of next year, will comprise seafront condominiums, and a four- or five-star hotel.

"We expect that from 2011, when all these projects take off, our turnover from property development will increase. We have several other new projects in the planning stage," Wong said.

For fiscal year ended June 30 2010, PJD posted a net profit of RM52.8 million on revenue of RM666 million, whereby 40-odd per cent was contributed by property development.

PJD also runs a profitable power cable manufacturing business and owns the Swiss Garden chain of hotels.

"We will definitely perform better in the current year," he said.

SOURCE: Business Times