Buyers should be happy with the extension of the Home Ownership Campaign till 31 December 2019. Here’s that earlier announcement: Home Ownership Campaign extended Perhaps we should ask this question. Is this extension attractive enough, yet? Well it really depends on the buyer’s understanding. Truth is, if the buyer still does not understand that buying is not about timing but more on pricing, then they may want to keep waiting until the cow comes home.
This is why we need good real estate negotiators who could explain this to the potential buyers. This is also why it’s not just about announcing the extension but also a bit more on the property market and property investment and why it’s an important decision versus ‘now is best time to rent’ mentality. Here’s another proposal to make it even more attractive to potential buyers.
Article in edgeprop.my here. First-time homebuyers in the secondary market can rejoice with the recent announcement of stamp duty exemptions. First-time purchasers of homes from the secondary market get stamp duty exemption on the memorandum of transfer and loan agreement for property purchases priced no more than RM300,000. For purchases of between RM300,001 and RM500,000, a similar stamp duty waiver is applicable (limited to only the first RM300,000 of the house price). They are applicable for sale and purchase agreements completed between Jan 1, 2019 and Dec 31, 2020.
PEPS president Michael Kong said that if the Finance Ministry wishes to stimulate the market further, it should review the Real Property Gains Tax (RPGT) which was aimed at curbing property speculation. He said, “The tax is now extended to the sale of properties which is owned even after five years, which we feel is not right as it seems like another form of income tax. This will deter property investment if owners have to pay the RPGT even after five years of owning their property. It cannot be retrospective.” He said that due to the current RPGT, even those who own property from 20 to 30 years ago will have to pay this tax. If the law is reverted whereby only those who dispose within 5 years are to pay tax, then this will give the market more confidence. Article in edgeprop.my here.
I agree that RPGT was one cause for negative sentiment, especially when it was announced. Somehow, people may not understand fully that RPGT is only on the profit portion and not the whole property price itself. Earlier article here: RPGT of a few hundred thousands? Here’show you calculate. Then again, the damage is done and the HOC 2019 was announced later on supposedly to counter some of these negative sentiments.
Whether HOC will be successful or not will have to depend on any official announcements on the actual total sales completed under the HOC2019. This may have to come from the Finance Ministry based on the tax exemptions under HOC. With the current extension, we may have to wait for a while more. Meanwhile it’s business as usual. Look for good properties and buy, not waiting for discounts on overpriced properties and buy. Happy understanding.
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