Housebuyers get good news from MOF

Prices of new homes to fall 5%-10% due to SST exemption, says Lim

KUALA LUMPUR: Prices of new homes could fall between 5% and 10% across the board after Finance Minister Lim Guan Eng announced an exemption on the Sales and Service Tax (SST) on construction services and building material costs.

“We placed the exemption because we want to boost the real estate sector. We hope to see a fall in new house prices.

“Otherwise, we will consider reimposing the SST (on developers),” Lim told reporters at the Parliament lobby yesterday.

Lim said that the discounts are only applicable to newly launched homes and does not include lowcost housing projects.

“For existing units that have been built, you will have to wait until Budget Day this Friday,” he said.

Also present during the press conference was Real Estate and Housing Developers Association Malaysia (Rehda) President Datuk Soam Heng Choon.

Lim thanked Rehda for pledging support to the government initiative despite a short notice.

“I wish that it could be a 10% discount but we will give time to Rehda to work towards achieving that goal,” he said.

As the SST exemption is applica- ble to all types of construction services, Lim hoped that savings in development costs by developers would trickle down to home buyers.

“People asked me if I’m asking too much for a 10% discount with the 6% tax exemption. I said no, we are very reasonable because we are talking about waiving all construction services, including industrial, residential and commercial,” he said.

“So, developers who benefit from the tax exemption, please pass it on to home owners.”

We placed the exemption because we want to boost the real estate sector. We hope to see a fall in new house prices. Lim Guan Eng