Do you have your personal wish lists? I think everyone has. Below is PropertyGuru’s views about the Budget and the property market Malaysia. I favour any more which does not harm the property market, for example loosening of lending standards. That will harm everyone in the medium term. Anyway, let’s read what PropertyGuru has to say.
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Towards Putting More Roofs Over Heads And Revitalising The Property Sector
- PropertyGuru proposes several measures for inclusion in Budget 2018
KUALA LUMPUR, 23rd OCTOBER 2017: Despite Malaysia’s property market stabilising in 2017 as consumer sentiments improve and prices showing a gradual uptrend, unaffordability remains at the heart of the matter. This continues to impact Malaysians in a profound way:
- 83 percent believe that properties are overpriced
- 46 percent feel interest rates are too high
- 43 percent mentioned dipping into their Employee Provident Fund (“EPF”) savings to purchase property – a 5% increase from last year
- 69 percent expressed concern over the economy
In addressing these and other concerns towards the ultimate aim of promoting home affordability and ownership, PropertyGuru Malaysia, the country’s top property portal proposes the following for inclusion in Budget 2018:
- An Updated Guideline / Definition for Affordable Property
While affordable property may differ from state to state and even location by location, a clearer reference point is needed to support plans for new housing supply, especially in key urban areas such as the city centre.
The definition should include not just price, but also unit size, location, private sector feedback and other considerations. There needs to be a clear consensus between the government, the private sector and the rakyat on what is perceived as an affordable home.
- Increased Plot Ratios
By increasing plot ratios, developers can build more units – optimising land use and space. This reduces the individual cost of each unit, resulting in more affordable homes. Transit Oriented Developments (TOD) especially should be allowed to have increased plot ratios.
This will not only promote home ownership, but also public transport ridership towards reducing traffic congestion and a more sustainable urban lifestyle,” he added.
- Revision to Gross Income to Assess Loan Eligibility,
By reverting to gross income, market transactions would increase significantly and almost immediately. But it can be restricted to special groups of buyers i.e. first-time homeowners only.
- Relooking Interest Rates
Given that banks have had a good financial year, PropertyGuru recommends a reduction of 0.5-1.0% of interest rates for first-time homeowners buying affordable properties offer first-time home owners a special interest rate if they bought affordable properties within a specific price range in transit oriented developments (“TOD”).
- Landlord Incentives
As we focus on home ownership, there is a need to focus on short-term solutions – providing more rental housing for Malaysians who cannot afford to buy or are saving up to buy but presently need a roof over their heads.
PropertyGuru recommends special incentives provided to homeowners who rent to Malaysians on a longer term basis i.e. 2-5 year tenancy agreements for those within a certain age bracket and income level i.e. the M40 Generation.
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