Budget 2017 that was announced today did not provide measures to shore up the property market or to help the bulk of potential homebuyers to own homes.

Heritage Shield Real Estate Sdn Bhd CEO and immediate past president of the Malaysian Institute of Estate Agents K Soma Sundram said Budget 2017 focused more on helping those who can’t afford to buy a property rather than on assisting those who can, especially the middle-income group.

“I’m not excited with this budget as it does not really help in stabilising the property market or to stimulate market growth,” he said.

“Most of the middle-income earners are facing challenges in securing loans to own a home. However, this group of people, which is also the majority of potential homebuyers, seems to be ignored,” he added.

On the increase in stamp duty for properties above RM1 million from 3% to 4%, effective Jan 1, 2018, Soma said this measure could be a burden to homebuyers especially for those who are looking for an ideal home priced at above RM1 million.

Eric Lim, founder and group managing director of Hartamas Real Estate Sdn Bhd, said the proposed benefits and assistance are mainly limited to the PR1MA schemes. “It is regretted that more was not done to boost the property sector as it is a clear driver of the economy. Repeated calls to provide more assistance to first-time homebuyers, regardless of property price, have gone unheeded,” said Lim, who is also MIEA deputy president.

On the “step-up” end-financing for the Perumahan Rakyat 1Malaysia (PR1MA) programme, Lim felt that it should not be limited to only PR1MA.

“By freeing up the financing limitation, it will certainly increase home ownership. While details have yet to be released, there are many new housing developments priced within the RM400,000 price range in which buyers will benefit as well.

On stamp duty increment for properties priced above RM1 million, Lim said the threshold should perhaps be higher as it is fairly easy to breach the RM1 million price point in the Klang Valley. The move will also discourage foreign investors since RM1 million is the floor price for foreign homebuyers.

Meanhile, Lim Boon Ping, training and development manager at Kim Realty and MIEA’s national vice-president said the stamp duty rise was surprising.

“The announcement of the increase in stamp duty for all properties worth more than RM1 million came in as a total surprise for me,” he said. “I believe this move by the government is to tax the rich to boost up tax collection.”

He expects the performance of this particular type of property will continue to soften and the market is expected to experience some adjustment before the measure is implemented in 2018 similar to the situation before the Goods and Services Tax (GST) was implemented.

“Overall, the budget shows that the Malaysian government continues to address first-time home ownership and what was announced are within expectations,” Lim told TheEdgeProperty.com.

Lim also lauded the government’s effort on the “step-up” end-financing scheme for PR1MA as well as the People’s Housing Programme (PPR).

Source: TheEdgeProperty.com.my

For housing, the following was announced to enhance first home buyers’ affordability:

• Financing will be easier and more accessible to buyers with total loan of up to 90% to 100% with loan rejection rate to be reduced drastically. For example, applicants with monthly income of RM3,000 now eligible for loan of more than RM187,000, will be able to borrow RM295,000.
• Stamp duty exemption increased to 100% on instruments of transfer and housing loan instruments, to help reduce the cost of first home ownership. This exemption is limited to houses with value up to RM300,000 for first home buyers only for period between Jan 1 2017 this and Dec 31 2018.
• A new special “step up” end financing scheme for PR1MA programme, under which, 12,000 units worth RM3bil have been booked.
• To provide government vacant lands at strategic locations to GLCs and PR1MA to build more than 30,000 houses at a selling price or RM150,000 to RM300,000.
• To build around 10,000 houses in urban areas for rental to eligible youths with permanent job including young graduates entering the labour market.
• To build 5,000 units of People’s Friendly Home, with the Government subsidising up to RM20,000 per unit. RM200mil will be allocated to SPNB.
• To increase the civil servant’s housing loans to RM200,000 and RM750,000 from RM120,000 and RM600,000 respectively.

People strolling along Gurney Drive are getting a respite from the muddy water that used to come up the shoreline.

A perimeter rock bund of the reclamation work going on off the coast has helped keep the murky water away, providing a jade-green seaview at high tide now.

A spokesman for Tanjung Pinang Development, which is responsible for the 53ha reclamation project, said the bund was almost 2km long.

It is 100m from shore at the nearest point and about 500m away at the furthest.

While the bund is to protect the surrounding sea during the reclamation, it has helped the shoreline.

At low tide now, tidal pools of clear water form, drawing flocks of coastal birds in search of fish.

“The bund is a temporary coastal structure to prevent erosion and keep small particles from dispersing into the sea,” explained the spokesman.

She said the bund was a requirement of an environmental impact assessment that was done earlier.

The area within the bund, she said, would be filled with sand at the end of next month or early December.

This is by far the largest reclamation project in the state and some Penangites have mixed feelings about it.

Penang Citizens Awareness Chant Group lauded the development and looked forward to the 24ha seafront public park, dubbed Gurney Wharf.

Find out more about Gurney Wharf

Social activist Anil Noel Netto hoped future developments would benefit people at large.

He was speaking at a talk entitled Gurney Drive Past, Present and Future orga­­nised by Penang Heritage Trust (PHT) in a Gurney Drive coffeeshop on Sunday.

Also there was PHT trustee Datuk Anwar Fazal and Malaysian Nature Society adviser Datuk Dr Leong Yueh Kwong.

Gurney Wharf will feature concepts inspired by internationally-acclaimed parks and should be completed in 2020.

Among its attractions will be a waterfront promenade, hawker centre, pier, 400m sandy beach and skate park.

Source: TheStar.com.my

A newly proposed luxury condominium Webest Land Sdn. Bhd. at Batu Maung. It is located along Jalan Permatang Damar Laut, adjacent to Sunway Mutiara housing scheme by Sunway Property.

This development will see the construction of a 25-storey building, comprises 42 residential units and 4 levels of car park.

More details to be available upon official launch.

Project Name : (to be confirmed)
Location : Batu Maung, Penang
Property Type : Condominium
Total Units: 42
Built-up Area: (to be confirmed)
Indicative Price: (to be confirmed)
Developer : Webest Land Sdn. Bhd.

Location Map:

Higher withdrawals from retirement funds and stamp duty exemptions are among measures for first-time home buyers likely to be announced in Budget 2017.

CH Williams Talhar & Wong managing director Foo Gee Jen (pix) said a 100% stamp duty exemption would help first-time home buyers as it could result in a RM2,000 to RM3,000 difference in stamp duty payment.

“That is something that would help. The other option available is to give grants to first-time home buyers. It will be definitely a good thing. At the end of the day, we do not want to give the impression that you must rush into buying houses, even for first-time home buyers. You must be able to afford before you jump into this big ticket item,” he said.

VPC Alliance (Malaysia) Sdn Bhd managing director James Wong said the stamp duty exemption, which is currently 50%, could be enhanced to 100% for first-time home buyers and expanded to houses below RM750,000 from the current RM500,000 limit to allow more first-time home buyers to qualify.

However, Malaysian Institute of Estate Agents (MIEA) immediate past president Siva Shanker warned that the system could be abused, if it is unable to determine whether the buyers are genuinely first-time home buyers.

“I think you must also differentiate a first-time buyer from a first-time home buyer. There are some people who never bought residential but have invested in commercial properties and made their money. When they decide to buy a house, they also enjoy all sorts of exemptions which is not fair,” he said.

National House Buyers Association of Malaysia (HBA) secretary-general Chang Kim Loong concurred, adding that enforcement against false declarations are as important as the statutory declaration itself.

“I would support it (100% stamp duty exemption) as it helps the new generation of home buyers but the selection criteria is very important. Making them swear a statutory declaration is important. However, prosecuting on false declaration is equally important as there are a lot of cases where there’s been a lot of deviation,” he said.

Chang said in the past, there have been buyers who claimed that they are first-time home buyers when purchasing low-cost homes but it was discovered later that these buyers own several low-cost units.

“That’s where the leakages are. The problem in Malaysia is that we don’t have a consolidated system on ownership. We don’t have data on whether they are first-time buyers or not,” he said.

Meanwhile, the announcement by Second Finance Minister Datuk Johari Abdul Ghani on allowing higher withdrawals from the Employees Provident Fund (EPF) Account 2 for first-time home buyers has been well-received.

“A better bet than allowing developers to give out loans (under moneylending licence) is to allow first-time home buyers to take extra money from EPF to bridge the gap. That is your own money. Whether you are investing it in EPF or in your home, it is fine because a home is an appreciating asset,” said Siva.

Wong, who also hopes that the withdrawal limit will be raised, said the move will result in higher equity and lower loan margin, thus reducing the total principal and interest cost to the buyer.

“The EPF dividend is only about 6%. Withdrawing EPF savings to buy the house will make sense as the future capital appreciation of the house will definitely be higher than 6%,” he said.

It was reported that the government and EPF were in discussions to increase the withdrawal limit from 30% to 40% for first-time home buyers. EPF declined to comment on the issue at press time.
Both Siva and Wong believe that developer interest bearing schemes (DIBS) will make a comeback in Budget 2017.

Siva, who in the past had said that such schemes led to speculative buying, said if such schemes return, it must be limited to first-time home buyers and a system must be in place to deter abuse.

“We are not in favour of DIBS to be revived in Budget 2017 as such packages actually distort property prices and the property market. DIBS actually created artificial demand in the market,” said Wong.

Chang, who also strongly rejects DIBS, hopes that the government would re-consider the Build-then-Sell (BTS) 10:90 scheme and suggested that the scheme be limited to houses priced not more than RM300,000.

Under BTS 10:90, buyers only pay a 10% downpayment and nothing more until the property is completed. The scheme was announced by former Urban Wellbeing, Housing and Local Government Minister Tan Sri Chor Chee Heung and was to be implemented beginning 2015.

However, it hit a snag when Datuk Abdul Rahman Dahlan, who replaced Chor, said that the scheme will be reviewed again.

Source: TheSundaily.my