Press Release: PropertyGuru: Youth, First-Time Home Seekers Priorities in Budget 2021
Budget 2021 should focus on job creation and economic drivers, particularly for youth and first-time home seekers, while addressing specific developer concerns such as compliance costs, according to PropertyGuru Malaysia, the nation’s largest property site as recognised by the Malaysia Book of Records.
These demographics have seen surges of home ownership interest following the COVID-19 outbreak. However, despite a bevy of property incentives and deeply favourable lending environment, employment and income loss are hampering them from purchasing a property.
As such, economic drivers to foster job creation and income growth, along with digitalisation and PropTech incentives to enhance awareness of available initiatives and opportunities, are key priorities for the property market as Malaysians recover and rebuild from a third wave of COVID-19 cases nationwide.
Priorities in place for fiscal policy
“Property transaction volumes and values in Malaysia showcased V-shaped recovery curves prior to the recent CMCO. Along with marginal growth in the Malaysia House Price Index and PropertyGuru Malaysia Property Market Index, this underscores the resilience of the property market post-pandemic,” says Sheldon Fernandez, Country Manager, PropertyGuru Malaysia.
“In short, the current incentives for property, as well as historically low interest rates and a wide range of purchaser and seller incentives, have been sufficient to promote market recovery for property to date. As such, while there remain numerous developer and industry asks in terms of Budget provisions, the emphasis should be on economic recovery to ease the plight of the rakyat.”
Most prominent among industry wishlists is the expansion of Home Ownership Campaign (HOC) incentives, such as stamp duty and instrument of transfer exemptions, to the secondary market. There have also been calls to extend the HOC beyond its applicability period of up to 31 May 2021.
In terms of developer asks, property players have highlighted the possibility of extending maximum loan tenures and reviewing eligibility criteria for home loan applicants. The reduction of compliance costs surrounding development (ie related infrastructure costs) and revision of foreign ownership programmes and thresholds have been cited as desirable as well.
“When it comes to reviewing loan tenures and eligibility criteria, financial institutions naturally have their own priorities in terms of risk management and minimising non-performing loans. However, developer concerns regarding compliance costs, if addressed, would promote ease of doing business. Meanwhile, a review of foreign ownership guidelines may address overhang concerns to some extent, but is unlikely to be popular with Malaysian home seekers,” says Sheldon.
Focus on economic drivers and digital incentives
Financial aid initiatives to assist Malaysians during the COVID-19 outbreak have proven popular and timely, with 39% and 11% of PropertyGuru Malaysia Consumer Sentiment Study H2 2020 participants citing satisfaction with Bank Negara Malaysia’s financing moratorium and Bantuan Prihatin Nasional (BPN) respectively.
Moving forward, further emphasis should be placed on long-term job creation measures and economic drivers, particularly for younger demographics and the B40 income group. According to the same study, home seekers aged 22-29 years old and renters are most likely to buy property post-MCO, with 47% and 51% respectively sharing that the outbreak would not delay their potential purchases.
“Meanwhile, a continued focus on digital incentives, such as grant funds for pilot projects on digital applications, particularly for PropTech players, would help foster innovation and uptake in the industry. This is particularly important in enhancing awareness of current initiatives, both in terms of property and other areas as well, such as reskilling opportunities,” says Sheldon.
“As the region’s leading and largest property site, PropertyGuru has spearheaded numerous PropTech initiatives, including PropertyGuru Loan Pre-Approval, PropertyGuru FastKey, PropertyGuru Lens and more, such as a one-stop hub consolidating over 100 HOC projects for convenient home seeker review.”
Set to be tabled on 6 November, Budget 2021 will outline the government’s estimated revenues and proposed spending for the coming year, while forecasting economic conditions and fiscal policy moving forward.
— End of Press Release —
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