People’s expectations for Budget 2017
IPROPERTY.COM Malaysia ran a short survey to gauge what Malaysians are expecting from Budget 2017. Below is a summary compiled via iProperty.com’s online survey involving approximately 300 respondents.
In a nutshell, the survey revealed that Malaysians are concerned about the rising cost of living, would like to see a reduction in income tax, and more efforts put into curbing crime and delivery of affordable housing schemes.
Said REA Group International COO Arthur Charlaftis: “We’ve seen significant increases in the cost of living in Malaysia, including price increases in fuel, toll-ways and public transport, as well as the introduction of Good and Services Tax last year. Some costs, such as public transport, have increased by as much as 102%, which is having a significant impact on Malaysian families.”
While there are many affordable housing and first-home applicants who have said that they had been turned away when applying to these “assisted housing purchase schemes”, the survey demonstrated that the people were hoping to see Budget 2017 provide more of such affordable housing schemes.
“Malaysia has a relatively young population and workforce, and there is strong demand for affordable residential properties in major urban centres. With transport costs also increasing, this young and growing segment of property seekers are looking for property in the cities, often close to their workplace,” Charlaftis reasoned.
Looking at the State of Households II Report by Khazanah Research Institute (KRI), the Malaysian median monthly household income in 2014 stood at RM4,585 while the average monthly take home was RM6,141. This works out to an average spend of between RM200,000 and RM300,000 on a piece of property of which REA Group chief economist Nerida Conisbee felt that the Malaysian government could incentivise developers to build more of these types of properties due to the high demand of houses in this range.
“Residential properties priced RM500,000 and above are only within reach of households earning at least RM15,000 per month, which equates to just 6% of the Malaysian population,” added Conisbee. She also suggests that the government look to other Asian countries with similar issues like Singapore or Hong Kong.
“In Hong Kong, to get people out of public housing, the government is active in subsidising home owners by discounting homes by 30% to 40% for low income earners,” Conisbee shared.