12 September 2014

Housing sales dragged down by cooling measures

  12 September 2014


PETALING JAYA: Sales of housing projects launched in the first half of this year have dropped below the 50 per cent mark, according to the Real Estate and Housing Developers Association (Rehda)’s industry survey.

Based on a sample size of Rehda’s 1,200 members in Peninsular Malaysia, the findings revealed that the launches of landed residential units were mainly in Selangor, Malacca and Negri Sembilan.

Rehda president Datuk Seri FD Iskandar Mansor said the real estate sector is facing difficult times mainly because of the cooling measures in the property sector.

The unsold units are attributed to unreleased Bumiputera lots and low demand or interest in a particular location, as well as the odd-corner and special lots.

“Buyers can pay 10 per cent downpayment and sign the sales and purchase agreement but until the loans are approved, we cannot consider them sold.

“Rehda supports the Bumiputera quota of 30 per cent. However, in certain locations, councils have increased the quota to 50 or even 70 per cent. By doing this, they are creating a higher cost of doing business,” said FD Iskandar.

He added that Rehda has proposed an automatic release mechanism for unsold Bumiputera lots.

For instance, in a housing project with 30 per cent unsold Bumiputera lots, developers should be allowed to release the first 10 per cent after six months of the launch and after giving adequate advertisement coverage in mainstream Malay media, including television and radio.

Subsequently, after the next 12 months, developers should be allowed to release another 10 per cent, and finally after 18 months, they should be allowed to release the rest.

“Demographic locality cannot be pushed, yet these quotas are still being implemented at every place,” said FD Iskandar.

On end-financing, he said 53 per cent of respondents cite buyers’ financial issues.

He added that Rehda would like banks to relook the calculation of a buyer’s income.

“The issue of not being able to buy a home is not because of property prices going up, but it is because our purchasing power has not gone up as fast as the commodity.”

On the Goods and Services Tax (GST), FD Iskandar said there will be an increase in property prices although houses are GST-exempt, as developers cannot claim back the input tax credit.

However, he hopes the price increase will not be more than three per cent.

FD Iskandar said there are still grey areas in the industry and they are working out the details with the Customs Department.

~ By BUSINESS TIMES

logoblog

Thanks for reading Housing sales dragged down by cooling measures

Previous
« Prev Post

1 comment:

  1. Yup, the property prices will be increased due to increasing cost of building materials,etc.

    When will be a good time to buy? Before GST or Wait. Any time is a good time depend on one financial capability.

    Whatever it is, the cost would not be coming down for sure...

    There will be a property roadshow: N.S Home & Property Fair @ Palm Mall, Seremban from 17-19 Oct 2014. Selected good properties for investment. I heard there will be some incentives for buyers during the fair.

    Should visit to choose first :) Any one with suggestion where is the good location in Seremban?

    ReplyDelete