New measures give buyers, developers hope
TPropertyGuru country manager Sheldon Fernandez The Real Estate and Housing Developers Association Malaysia says decreasing the foreign home ownership threshold for strata properties to RM600,000 is positive for the industry. HE 2020 Budget has provided hope to developers, house buyers and industry stakeholders, said PropertyGuru country manager Sheldon Fernandez.
He said the revision of the base year of acquisition for real property gains tax (RPGT) from Jan 1, 2000 to Jan 1, 2013 will soften the impact on higher tiers of the market, but its continued application will be a concern for investors and other stakeholders in the property value chain.
He said provisions targeting issues, such as first-time home ownership and the residential property overhang like the extension of the Home Ownership Campaign (HOC), are much needed to restore confidence in mid-range housing and the sector as a whole.
“Labour-centric provisions and reforms, along with macroeconomic boosters, will raise the overall income for Malaysians, tackling affordability from the bottom up. However, this is a long-term play which will take time to impact home seekers,” said Fernandez.
He also said the allocation of RM10 billion for rent-to-own (RTO) schemes for first-time house buyers is a step in the right direction as an alternative financing platform.
The RTO scheme offers buyers the option to rent for five years and apply for end-financing to purchase the house in the sixth year based on the price fixed at the time the tenancy agreement is signed.
Knight Frank Malaysia managing director Sarkunan Subramaniam said the RTO may be able to address the overhang issue of condominiums and serviced apartments.
He hoped the RTO would help increase home ownership among Malaysians, in particular the lower-income group.
“We applaud the great initiative by the government to continue with the RTO scheme. However, there is concern that the property sold may include the expected capital gain, which may lead to higher a property price compared with the current market value. This scheme has to be regulated and fairly practised by the public and private sectors.”
Sarkunan hopes there will be more initiatives to maintain the momentum in the recovery of the housing market.