KUCHING, Sept 24: The total number of houses transacted during the first quarter (Q1) of 2019 in Sarawak is 2,647 units, lower when compared to the last quarter (Q4) of 2018 with 2,802 units, but much better than Q1 2018 which was 2,143 units.
Sarawak Housing and Real Estate Developers’ Association (SHEDA) Kuching chairman Sim Kiang Chiok said that these figures also indicate that there is no growth in the property market even though demand is increasing due to population growth and rural-urban migration.
He also pointed that the decline could be due to the challenges faced by developers and buyers and that among the biggest challenges for the property market is to fixed the triangular relationship of the developer, purchaser and banker.
“At the present moment, the developers will build, purchasers are ever-increasing because of population growth and rural-urban migration, but the banks are being constrained by the strict lending guidelines by Bank Negara Malaysia (BNM),” lamented Sim in a statement.
He disclosed that the lending policy based on proven income is affecting demand for houses, especially from first time house buyers facing insufficient income or poor payment record.
He opined that staggered repayment for end-financing should also be allowed so that the initial first 5 years’ repayment can be low and affordable to match the purchaser’s payment ability.
Sim believed that individual banks should be allowed to lend based on their own assessment instead of just following Bank Negara Malaysia guidelines as the risks faced are borne by the lending banks themselves. Other income not declared to Inland Revenue Department (IRD) as proven income should be taken in as assessment by individual banks to lend to house purchasers.
“Banks should be allowed to lend based on asset lending instead of just proven income-based lending,” he asserted.
Among his expectations for the federal and state budgets is that the government should encourage more investors, and reconsider removing the Real Property Gain Tax (RGPT) after the fifth year.
He added by doing this it will reduce corporate and personal income tax and that there will be more money to be put in the private sector to spur the economy.
He also said that the government can build more infrastructure to open more areas so that more land is available for housing development.
Sim also believes that bank lending guidelines should be eased for house purchasers and also Small Medium Enterprises (SMEs) .
He said the government can help to recapitalise SME by easing restructuring and rescheduling guidelines so that investment into the economy can be resumed and strengthened.
He expects that the government will continue with the MY Deposit scheme where first-time house buyers can apply for a grant to help out in deposit payment.
Sim would also like to see any suitable overhang properties for first himes purchased from private developers by the government for their rent and buy scheme under social housing policy.
Thus, instead of building more new houses, the overhang properties can immediately fill demand for social housing.
Sim also suggested that the house ownership campaign (HOC) by the federal government be extended into 2020 and could include all types of properties.
He made these remarks with regards to property trends and purchasing power in Sarawak for the first and second half of 2019, the challenge faced by developers, purchasers, and banks, and his expectations for the federal and state budget for investors on properties here. — DayakDaily
