10 October 2014

MIDF ‘neutral’ on property sector

  10 October 2014

MIDF Research expects to see more measures focused towards affordable housing in the 2015 Budget, to be tabled later today.

This follows the rationalisation in petrol subsidy and the imminent Goods and Services Tax (GST) imposition next year.

“We anticipate some of the measures introduced in prior years to make a comeback or extended and broadened,” MIDF Research said, citing full loan facility under the My First Home Scheme, 50 per cent stamp duty exemption for first-time house buyers for units worth RM400,000 and below, as well as better incentives to encourage private developers to build low- to medium-cost properties and more PR1MA/PPR (low- cost houses) units built next year.

“We also expect further relief targeted at first-time house buyers such as zero-rated GST for properties worth RM400,000 and below as lobbied by the Real Estate and Housing Developers Association,” it added.

In its note yesterday, MIDF Research said the floor price of properties accessible to foreigners could also be raised.

“We are not expecting another round of hike in Real Property Gains Tax,” it said.

MIDF believes the key beneficiaries will be companies with a good mix of medium- to low-value properties such as Mah Sing Bhd, IJM Land Bhd and LBS Bina Group Bhd.

To a lesser extent, UEM Sunrise Bhd could also benefit from its product mix and landbank sale.

Meanwhile, the research house said this could be a setback for companies with sizeable exposure to high-end properties such as Eastern & Oriental Bhd, SP Setia Bhd and Sunway Bhd.

MIDF is keeping its “neutral” stance on the property sector, based on the GST imposition that may lead to some reduction in disposable income and dam-pen consumer sentiments in the near term.

However, it said this could be offset by the government’s targeted measures while longer term prospects remains positive against the upbeat economic outlook.



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