The upcoming budget announcement in Malaysia could have a sizeable impact on the country's property market, according to the latest reports coming out of the country. Some measures are expected to focus on the need for more affordable homes to be built and brought to market, while others will be focussed on creating legislation that would see an end to speculation in the market and pave the way for swathes of more serious investors and end users to purchase at more sustainable prices.
NST RED spoke to a number of industry experts to see what they believed the outcome of the budget would be. It was found that the majority expect to see a change to the Developers Interest Bearing Scheme (DIBS), which could even be abolished, as well as a rising of the Real Property Gains Tax (RPGT). With the latter in particular, it would be unlikely that speculators would want to buy and sell quickly if they were subjected, helping to curb the apparently incessant price rises inherent at the moment.
Other people in the sector have been looking for a range of different revisions to the market in order to help Malaysians get back on the ladder and leave them able to afford their own home. Datuk Seri Michael Yam, President of the Real Estate Housing Developers' Association of Malaysia (REHDA), said he hopes to see stamp duty revised as one of the main changes introduced during the budget. A lowering of this levy on house purchases could see more people able to afford properties. It is a reality that did come to fruition in the UK in recent years, when property sales of homes costing less than £250,000 were exempt from stamp duty for two years, which helped more than 100,000 people onto the housing ladder.
James K K Tan, project director, Suntrack Development Sdn Bhd, added that the only way to tackle the issue of low numbers of affordable homes is to take the right to build them away from private contractors. "It is much more cost-efficient for the government to undertake social housing in strategic locations due to their increased scale of economies and better planning in public transport and amenities. A 'social housing fund' may be collected from the private developers on top of our corporate tax, development charge, conversion premium and many other forms of contribution currently payable," he added.