The construction sector is expected to remain attractive next year amid a weaker domestic currency due to lower demand for commodities and the general public apprehension over the goods and services tax (GST).

Malaysia Building Society Bhd president and CEO Datuk Ahmad Zaini Osman said he expected the property market to remain sustainable, with the demand not much affected, even upon GST implementation in April next year.

“Furthermore, I think, our building materials, in term of currency, won’t be much affected as most of our products is local. We no longer bring in imported products.

“Hence, I foresee that the property sector will remain sustainable next year,” he told Bernama.

Despite possible slight oversupply of properties in certain areas, he said the government had already put a freeze on new projects in certain areas to neutralise the demand.

“Overall, there will be enough demand and supply. So, there will not be overly excess supply,” he added.

On the need for developers to move to suburban areas, he said that for any suburban area to be attractive, there had be a magnet to lure house buyers.

He said demand for housing would be high in areas near educational institutions like universities, having efficient public transportation and close to expressways.

On affordable housing, Zaini said the Government should develop urban outskirts, taking advantage of lower land prices, but they should have good road networks and transportation services.

The construction industry reported the strongest growth across sectors in the first six months of the year, registering 14.3%.

The government expects the momentum to continue into the second half and next year, fuelled by approved government projects and potential investments from the private sector.

Source: Bernama

State excecutive councillor for Housing and Town & Country Planning Jagdeep Singh Deo has lashed out to irresponsible tenants of low cost (LC), low-medium cost (LMC) and affordable housing housing renting out their units when it is a clear breach of tenancy agreement.

The Selection Process Enhancement Committee (SPEC) chaired by Jagdeep vets through and selects only eligible Penangites who are deserving and in need of such housing.

“We want to realize the dreams of many of families of having roofs over their heads, it is unfair for those in need, some with extended families waiting in line for houses while some irresponsible parties are using these units for profit,” he said.

“It has come to my knowledge that there are those who have been allocated such LC and LMC units, both during the selection process by SPEC and even before it by the Housing Department, who are advertising to rent the same out, which is in breach of the condition expressly set out in the Form PN1,” Jagdeep added.

A clause in Form 1 clearly states:

I also agree that my family and I will occupy the unit allocated.If it is discovered that my family and I does not occupy the said unit allocated without any reasonable explanation or is rented/ occupied by others, the Housing Department of the State Secretary Office has the right to revoke the offer and repossess the unit that has been allocated without payment of any compensation.

Jagdeep has sought the council of the Housing Department’s Legal Adviser to subject the irresponsible landlords a criminal charge under Section 420 of the Penal Code for cheating witnessed by, amongst others, EXCO members, Members of Parliament, State assemblymen, Justices of Peace, Advocates & Solicitors and the Penghulu.

Jagdeep has consulted the Malaysian Institute of Estate Agents (MIEA) Penang Chapter who have agreed to assist the state government by instructing their agents not to advertise to rent LC and LMC units certified by the Penang housing department and extended to affordable housing projects once completed.

The state government together with Penang Development Corporation (PDC) has in the pipeline 12 projects which will deliver 22,545 units of low cost (850 units) low medium cost (7,874 units) and affordable housing (13,851 units).

The private sector through public-private partnership is set to match or exceed this number in terms of provision of low cost, low medium cost and affordable housing units.

Since the inception of SPEC in August 2013, a total of 7,291 applicants have been selected to be designated low cost, low medium cost and affordable housing.

The Penang Housing Department has a waiting list of 25,065 applicants and 24,283 applicants for low cost and low medium cost units respectively.

“The Penang State Government together with PDC and the private sector are vigorously pursuing such low, low medium cost and affordable housing projects which must ultimately reach the intended target group, namely the needy and deserving applicant.”

Source: Buletin Mutiara

According to UBS, Bank Negara is likely to cut its overnight policy rate by 25 basis points in 2015, with lower oil prices cushioning the pressure on inflation.

Bank Negara Malaysia is likely to cut its overnight policy rate (OPR) by 25 basis points in 2015, as the fall in the oil prices would cushion the pressure on inflation, according to UBS.

The central bank last increased its OPR in July 2014 to 3.25%, after keeping it at 3% since 2011.

At its last Monetary Policy Committee meeting in September 2014, it decided to maintain the rate.

UBS’s Singapore-based senior economist, Asean and India, Edward Teather, said inflation was unlikely to be high in Malaysia, estimating it to be 3.9% next year. This, he said, was well below the government’s estimation of 4.5%.

The introduction of Goods and Services Tax in April 2015 would lead to higher inflation, but would be capped by lower crude oil prices with possible increase in demand for the non-oil sector, he said.

In 2015, crude oil prices was expected to average at US$70 per barrel, and in 2016 US$80, said Teather.

“Higher household debt level means that Bank Negara is not going to embark on major rate-cutting cycle.

“At the same time the government’s revenue is going to be constraint by lower oil revenue, limiting its ability to help support the economy,” he said at a conference call here today.

The bank also estimated that inflation would be reduced to 2.5% in mid-2016.

Teather said the Malaysian Government would be able to meet its fiscal deficit target of 3% in 2015 despite a challenging economic environment.

“If the crude oil price averages around US$70 and US$75 per barrel, the government should be able to manage the situation and its deficit target could be achieved,” said Teather.

He said the ringgit was expected to reach the 3.50 level against the US dollar by end-2015 albeit at a slower pace, should the Asian currencies continue its downward trend against the greenback.

“We think the stabilising oil price and the ability of the Malaysian investors to bring capital home from abroad will help stabilise the currency,” he said.

Source: Bernama

Federal development agencies JKP Sdn Bhd and the Penang Regional Development Authority (Perda) have agreed to comply with state requirements on their projects in Penang.

Federal Action Council chairman Datuk Zainal Abidin Osman said JKP and Perda will be amending their development plans to comply with what the state government wants.

He said both bodies will also be submitting their justifications with regards to pricing of the residential units within their projects.

“Perda and JKP are always ready to work with the state government and the local authorities to provide comfortable and affordable housing to the people in Penang,” he said in a statement today.

The move comes after Zainal and state Housing Committee chairman Jagdeep Singh met on Wednesday to sort out issues relating to projects by the two federal agencies.

Both agencies and the state have been at loggerheads for some time over the issue with Zainal alleging the projects were held up but Jagdeep denying that was so.

JKP has eight projects while Perda has seven involving a total of 9,444 residential and commercial units.

Jagdeep meanwhile said the state was prepared to consider applications for low-cost and low-medium cost residential units for land procured through land acquisition for public purpose.

He said the state was prepared to consider applications if prices for housing units did not breach the RM400,000 ceiling on the island and RM250,000 on the mainland for land not procured through land acquisition.

“Both Perda and JKP were asked to submit their official request before Jan 15 next year,” he said in a press conference today adding the State Planning Committee (SPC) will be deliberating the matter.

Source: The Sun Daily

Fresh off a successful run of pumping RM17.5 million in grants to inject energy into George Town, Think City is seeking to replicate its success by partnering the public and local governments of the national capital and Butterworth. — Picture by K.E.Ooi

If you live in Kuala Lumpur, George Town or Butterworth and have ideas to make your city a better place to live, you can tap Think City for its new RM30 million public grant for urban renewal.

Fresh off a successful run of pumping RM17.5 million in grants to inject energy into George Town, Think City is seeking to replicate its success by partnering the public and local governments of the national capital and Butterworth, a township on Penang’s mainland that has undergone a development boom in recent years.

Think City’s Hamdan Abdul Majeed said Butterworth was chosen as it was a counterpart to its more popular cousin on the island — George Town — and is a typical “secondary city” where there is generally a “narrow population base, limited sense of opportunities” and is struggling to find its own identity.

For the country’s capital city Kuala Lumpur, Hamdan said the organisation will focus on its downtown — a one kilometre radius from Masjid Jamek — which houses the city’s roots and history, along with multiple heritage buildings.

“Each of the city, the focal point will be different,” said the CEO of state investment arm Khazanah Nasional’s wholly-owned subsidary when announcing the new grant programme today.

“We hope we’ll be able to get support and participation from the wider public through the grants programme,” he told reporters here.

The expected RM30 million figure for the fund over the next three years is based on the annual RM8 to RM10 million allocated to Think City by Khazanah Nasional’s foundation — Yayasan Hasanah.

Anyone from individuals, NGOs, schools, community councils, private property owners to companies may apply for grants of between RM10,000 to RM100,000 through forms available on Think City’s website: www.thinkcity.com.my/tcgrants

The projects can be wide-ranging including public art, but a key criteria will be sustainability — where projects can live on even if grants are no longer given out, Hamdan said.

“Typically a lot of grants will focus on restoration of buildings, improvement of public spaces, cultural; could also be activities in the city, urban mobility projects, what I call innovative and creative ideas about making the city better, greening, making the urban environment more conducive,” he said, also adding that applications for grant amounts beyond RM100,000 could be considered based on the projects’ impact to the cities.

The deadline for the first round of application is January 31, 2015, with ThinkCity then carrying out an eight-week assessment before announcing the approved grants in early April.

Think City is still assessing the impact of its previous grant program on George Town and is expected to announce the historic city’s inclusion in the same RM30 million Think City Grants Programme in the second quarter next year.

Think City has already started laying down the groundwork for its foray into the fourth city on its list, the Iskandar Malaysia economic corridor in Johor, with possible plans to extend the grants to the fast-booming city.

Hamdan said Think City is focusing on arts and culture in Iskandar and is trying to identify areas where they can “fill in the gaps” in the rapidly-developing city.

“For example, possibility is there to have a proper signage system, to improve green environment in the city,” he said, pointing out that a city is not merely a “block of buildings”.

Economic impact, better living

Think City thinks it can help quadruple the amount of money being pumped in to regenerate the cities, when matched against disbursements of its own public grants.

“Our experience shows that we are able to get a ratio of one to four, meaning for every dollar we put in, they are able to attract three to four dollars into the project. This is not in any way even estimating the spillover effects,” Hamdan said.

In Think City’s George Town experience, every RM1 disbursed in grant saw private stakeholders putting in an additional RM6, with stakeholders investing RM98.4 million against Think City’s RM16.4 million during the 2010-2013 period.

According to Think City, 87 heritage buildings were restored and 600 jobs were created in the UNESCO heritage site George Town as a result of its grant programme – which eventually came to a total of RM17.5 million for over 240 projects in the past four years.

Hamdan said Think City aims to add value to existing projects and initiatives, saying: “We are very happy that in each of the city that we are looking at, there’s already a momentum in the cities. So we are confident to say that in the next three to four years, we are expecting positive outcomes from these kind of collaborations.”

Hamdan also spoke on the need for an “urban movement” where every citizen would take “ownership” of their cities.

“Seventy-five per cent of Malaysians live in cities, it’s no longer a case of rural community. But then urban living is very challenging, so how do you make urban living better? That’s where the whole idea of having an urban movement is very essential to ensure our cities are liveable and sustainable,” he said.

Source: The Malay Mail Online