DIBS (Developer Interest Bearing Scheme) should be reinstated for people buying their first home. Rehda Penang Chairman, Datuk Jerry Chan said that this is essential because it was so tough for genuine buyers to get a home of their own these days. DIBS makes it easy for buyers to buy because they do not need a huge downpayment. In fact, DIBS was abolished because of the view that it has encouraged too many buyers to flip which is not a healthy thing in the property market. I sort of agree with him. I think for first time home buyers, more things can be done to assist them.
Personally, I think DIBS can be revived because we still have RPGT (Real Properties Gains Tax) anyway. Majority of buyers may think twice if they wanted to flip because they really have to ensure the profit is there or else it’s a waste of time for them. However, if we are really serious that this is only to help first time home buyers, then limit it to certain types of properties only and not a blanket one across all. How about limiting it to just properties below RM500,000? This will help developers to plan their developments so that it is below Rm500,000 and actually benefitting the first time home buyers.
Anyway, the issue with all these schemes is always that the buyers / flippers may find a way around it. Malaysians are the most creative lot. Thus, if REHDA Penang is serious in helping first time home buyers, then the control should also be from the developers too. Disallow bulk buy. If this is to help genuine buyers, why should these genuine buyers buy more than one unit? Many developers have only one objective in mind, sell everything quickly. However, if this scheme is to be continued successfully, I think REHDA Penang has to send a very clear message to all its members. To me, bulk buy is one reason why speculative activities are happening and not just these loopholes etc.
There, if DIBS comes back for first time and genuine home buyers, RPGT will be a good line of defence but the first line of defence would be the developers themselves. Should it be revived for first time home buyers? Personally, yes. Even if I am not qualified.
written on 1st May 2014
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