By Adrian Lim
KUCHING, June 7: A few measures announced by Prime Minister Tan Sri Muhyiddin Yassin for the property sector under the National Economy Revival Plan (Penjana) last Friday (June 5) is expected to create excitement for the property market.
Sarawak Housing and Real Estate Developers’ Association (Sheda) Kuching branch chairman Sim Kiang Chiok said the federal government’s move to bring back the Home Ownership Campaign (HOC) will generate interest and more property transactions among house buyers and subsequently revive the subdued property market.
He believed the move will attract more house buyers and generate greater interest for the property market.
“The federal government has started the ball rolling in reviving the property market by bringing back the HOC from 2018 till 2019.
“It is a smart move by the government to facilitate and provide incentive for home ownership as the government will provide stamp duties exemption on transfer of residential property, sale and purchase agreements and loan agreement for the purchase of houses between RM300,000 and RM2.5 million.
“This will create attraction and interest in the property market.
“It is also a good time to look for residential properties during the HOC period from June 2020 until May 31, 2021,” he said in a statement today.
Besides, Sim believed Muhyiddin’s announcement on the real property gains tax (RPGT) exemption for Malaysians for the disposal of up to three properties between June 1 and Dec 31, 2021 will also help the secondary market of residential properties creating more transactions.
He opined that the move will help to ease the process of residential property transaction during the exempt period.
On the third housing loan financing limit worth RM600,000 and above which will no longer subject to 70 per cent margin of financing of the value of the home assessment, Sim said the initiative is welcomed by property investors which will revive the interest in property as investment with good returns in rental, long term appreciation and protection against purchasing power of our currency.
At the same time, he believed property developers will be able to attract more investors for their product offerings.
For the property market, Sim lauded the measures presented by Muhyiddin as it is much needed to kick-start the economy during the Conditional Movement Control Order (CMCO period.
However, he asserted that job security and the availability of bank loans are important for the HOC to be implemented successfully
“In the housing market, the three main players are the house buyer, developer and bank.
“When the economic is good, the potential buyer is earning good salary, and the banks are willing to lend, developer will be able to build and sell their properties to satisfy the basic need of a good shelter.
“However in this economy recovery phase, for the property market to be revived, the banks must have the risk appetite to lend and jobs security for the potential buyers must be good,” he added.
Apart from that, he observed that the federal government has extended the Wage Subsidy Programme that is much needed to assist employers to keep their workers.
However, he would prefer the federal government to follow the initial staggered wage subsidy programme.
Besides, he also believed the assistance in Employment Incentive Programme to employ the unemployed and youth is much welcome and this plan is a much thoughtful initiative by the federal government to ensure the unemployed can be hired in a much productive manner.
He added the government wage assistance programme and the bank loan moratorium for six months are helping the property developers from the negative spiral of loan defaults and unemployment.
Sim opined that the potential of loan defaults by banks will lead to recession and even deflation to the country’s economy if the short term economic recovery plan is not executed appropriately.
For the property development industry, Sim emphasised that there could be abandoned projects and loss of jobs. —DayakDaily