Property owners protesting
By Danny Bance

Property owners protesting overvaluation in Malaysia

All isn't well in the Kuala Lumpur property market, with residents and homeowners now protesting overvaluation. People are up in arms about the adjustment, which will increase property taxes, even if assessment rates are unchanged, the Malay Mail Online reported. However, the Umno minister has labelled people of the city "confused" - something DAP's Teresa Kok has condemned.

Speaking to the news provider, the Seputeh MP accused the Federal Territories minister Datuk Seri Tengku Adnan of himself being confused. She claims he has misunderstood the rationale behind objections to overvaluation. "The huge increase in the new annual value will bring about [a] big hike in their property assessment rates if the current percentage rates imposed remain unchanged," Ms Kok said. "Irrespective of whether there will be changes in the percentage rates, objections can be made if there are grounds that the properties have been overvalued."

The price adjustment could also have negative effects on foreign investors, discouraging buyers from ploughing money into the city. New rules to limit speculation will also come into effect in January, which will make it more difficult for people from overseas to buy property. The Global Property Guide explained that from next month international investors will only be able to purchase property priced at RM1 million (£189,312) or above. Higher property gains tax has also been imposed by the government.  This will abolish the tiered rate system and introduce a flat rate of 30 per cent if a property is sold in the first five years after purchase.

The Global Property Guide claims this will have an effect on overseas buyers looking for quick gains or a holiday home. What's more, the measures may not be able to cool property prices, rendering the changes seemingly misguided. Datuk Michael Yam, president of the Real Estate and Housing Developers Association, claims the reforms could encourage people to hold onto their homes for longer, causing supply to decline and prices to travel upwards further.
Related articles
comments powered by Disqus
Search