First-time house buyers to gain

October 30th, 2014 No comments

HBA is happy that more affordable homes are to be built under Budget 2015 and DIBS ban stays.

The National House Buyers Association (HBA) wishes to thank the Prime Minister for the measures announced in Budget 2015 to build more affordable homes for the rakyat.

HBA is grateful that the Prime Minister rejected calls from the Real Estate and Housing Developers’ Association Malaysia and other groups with vested interest to reintroduce Developer Interest Bearing Scheme (DIBS) for first-time house buyers.


The HBA is glad the Government has continued to heed our call to ban DIBS or any permutation that entails interest capitalisation.

Developers, being entrepreneurs, have to be responsible and bear the risks that come with their investment. They should not be allowed to enjoy profits at the expense of house-buyers who bear the risks on their behalf. Thus, when developers claim that DIBS is good because they “assist new purchasers”, they should be asked to use the Built Then Sell (BTS) 10:90 concept instead if they are sincere in not wanting to shift the risks to the house-buyers. Developers, being profit driven, merely want to sell their products, by whatever means. They even recommended DIBS for first-time house buyers on the guise of “assisting them”. We are glad the developers did not succeed in this endeavour.

The prohibition of DIBS in Budget 2014 has been effective in curbing the unbridled escalation of house prices. DIBS must continue to be prohibited and outlawed. Do not allow first-time house buyers to be sucked in.

Budget 2015

Among some of the measures announced is the Youth Housing Scheme, which is a smart partnership among the Government, Bank Simpanan Nasional, Employees Provident Fund and Cagamas.

The scheme offers a funding limit for a first home not exceeding RM500,000 for married couples aged between 25 and 40 years with household income not exceeding RM10,000. The maximum loan period is 35 years.

Under the scheme, the Government will provide monthly financial assistance of RM200 to borrowers for the first two years to reduce the burden of monthly instalments. The Government will also give 50% stamp duty exemption on the instrument of transfer agreements and loan agreements.

It will also provide a 10% loan guarantee to enable borrowers to obtain full financing including cost of insurance. Borrowers can also withdraw from Employees Provident Fund (EPF) Account 2 to top up their monthly instalment and other related costs.

Hence, HBA urges young people to grab this opportunity which is offered on a “first-come first-served basis” for 20,000 units only.

While the scheme is laudable as it aims to assist married youths to own their own property, HBA urges some caution as providing a monthly cash subsidy of RM200 may send a wrong message. The said family may start to spend beyond their means during the first two years and may end up in financial difficulty when the government stops giving the cash subsidy after two years. In addition, HBA has always cautioned against so-called “Zero Entry Cost” properties whereby the buyer does not need to make any down payment as it may encourage and promote irresponsible house buyers. House buyers must understand the intricacies of taking responsibility as an owner. They must pay their dues – quit rent, assessment rate, maintenance charge, sinking fund, insurance premium and budget monthly expenses. It is very important that they pay monthly instalments to the bank. It is not surprising to hear of lower and middle income homeowners losing their homes for not being able to keep up with payments.

HBA also urges the Government to impose a restriction that properties under the Youth Scheme cannot be sold for the first 10 years, similar to properties under the 1Malaysia Housing Programme (PR1MA).

Additionally, the scheme must be for “first-time house buyers” and must be owner-occupied.

Additional measures are:

  1. PR1MA to build 80,000 affordable houses and eligibility raised from monthly household income of RM8,000 to RM10,000;
  2. National Housing Department to build 26,000 units under the People’s Housing Programme with an allocation of RM644mil; and
  3. Syarikat Perumahan Negara Bhd (SPNB) to build 12,000 units of Rumah Mesra Rakyat and 5,000 units of Rumah Idaman Rakyat. SPNB will also build 20,000 units of Rumah Aspirasi Rakyat on privately-owned land.

HBA is grateful that the Government has taken the initiative to build more affordable houses. However, HBA cautions on the right implementation to ensure the said affordable housing reaches the target market. Government agencies must be mindful – and keep reminding themselves – of the following adage: “Build the right number at the right location for the right population at the right price and with the right type.”

The affordable housing must be built at the right place and priced reasonably (between RM150,000 and RM300,000 and not more than RM400,000 for prime locations) and only for first-time house buyers and not to be made available for second-time house buyers which PR1MA is allowing with certain conditions. Don’t ever build where there is no population, just for the sake of building and meeting key performance indicators (KPIs).

PR1MA must also ensure that all the allocated land are used to build affordable housing and not to partner with private developers whereby only 40% of the land (from what we understand from the market) are for affordable properties with the balance used for lifestyle properties to build commercial and high-end properties.

HBA further opines that the best agent of delivery for private affordable housing, notwithstanding PR1MA and SPNB, are private developers. The Government can boost the delivery of affordable housing by giving incentives and rebates to private developers building affordable housies such as:

  • Lower corporate tax rates;
  • Lower land conversion premiums;
  • Fast-track release of unsold bumiputra units; and
  • Lower compliance costs.

To enable more people to own their first home and reduce the cost of buying a house, the Government has agreed to extend the 50% stamp duty exemption on instruments of transfer and loan agreements and increase the purchase limit from RM400,000 to RM500,000. The exemption will be given until Dec 31, 2016.

HBA agrees with measures to assist the lower and middle-income group to acquire their own properties and to prevent any abuse of these measures, the assistance should only be given to first time house buyers.

The Government also agrees to improve Skim Rumah Pertamaku under the purview of Cagamas by raising the ceiling price to RM500,000 in line with the stamp duty exemption. In addition, the age of borrowers to qualify for the scheme will be increased from 35 to 40 years.

HBA agrees with the these measures and further recommends that there be no age cap as there are many older low and middle-income groups who have yet to own their first property.


The curbs announced and implemented under Budget 2014, i.e. increase in Real Property Gains Tax (exit costs), the loan-to-value and prohibition of DIBS have achieved its objectives in partially deterring speculators and “bogus” house buyers. It has also bought some sense of orderliness to the housing arena. We have appealed to the Government to adopt more measures in Budget 2015, especially the increase in stamp duties (entry costs).

The current stamp duty regime can be maintained for the first two properties held, one being for own stay and one for long-term investment. However, stamp duty must be increased for the third and subsequent properties. Our recommendation for stamp duty is as follows:

  • First two properties, based on current scale rate;
  • Third property – flat 5% of value of property;
  • Fourth property – Flat 7.5% of value of property; and
  • Fifth property – Flat 7.5% of value of property.

HBA’s proposal will not penalise the majority of the rakyat who can only afford to buy two properties.

HBA is prepared to wait and see the performance of the property market as to whether “speculators and bogus” house buyers will remain to “play” the market. We are sure that our Prime Minister and his advisors are fully aware of the situation and could always expeditiously implement this proposal in Budget 2016 if “speculators and bogus” house buyers were to plague the housing market.

>> Chang Kim Loong is the honorary secretary-general of the National House Buyers Association,, a non-profit, non-governmental organisation manned purely by volunteers.


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Taman Tasek Harmoni

October 28th, 2014 24 comments

Taman Tasek Harmoni, a mixed development by Loyal Greenworld Sdn. Bhd. along Jalan Tasek in Simpang Ampat, Penang. It is adjacent to Pearl City by Tambun Indah, just a short drive away from Simpang Ampat town center.

The residential phase of this development comprises 73 units of 2-storey terrace and 12 units of 2-storey semi-detach houses. Selling price for the standard 2-storey terrace house starts from RM378,000 onwards. The commercial component has 18 units of 2-storey shop offices.

Property Project : Taman Tasek Harmoni
Location : Simpang Ampat, Penang
Property Type : 2-Storey Shop Office, 2-Storey Terrace and Semi-Detached
Land Area: 1,356 sq.ft. (Terrace), 2,228 sq.ft. (Semi-D) onwards
Built-up Area: 1,775 sq.ft. (Terrace) 1,798 sq.ft. (Semi-D) onwards
Tenure : Freehold
Indicative Price : RM378000 onwards
Developer : Loyal Greenworld Sdn. Bhd.
Contact Number : 04-5078980, 012-4270366

Location Map:

Categories: Simpang Ampat Tags:

Dreams Homes on Offer

October 27th, 2014 No comments

From chic nest eggs for one’s golden years to cozy cul-de-sacs for your burgeoning family, the Uniquely Property Showcase 2014 aims to offer property enthusiasts of all ages and income groups an affordable route towards their ideal dream homes.

Taking place from October 30th till November 2nd at one of the Pearl of the Orient’s most popular shopping haunts, the Queensbay Mall, the second installment of the property extravaganza features booths and exhibitions by close to a dozen of the industry’s biggest movers and shakers including such illustrious names as Alor Vista, Best World
Realty, Gold Mart Development, Handle Property Group, KL Metropolitan, Oriental Max, TFDC Asiacorps well as Sunway Group and promises a myriad of not to be missed deals, promotions and exclusive rebates.

The brainchild of Penang based Unico Events Management, project manager Michael Chow believes that the wide range of developers on show helps set the showcase apart from other such fairs and exhibitions and will certainly appeal to a broader target audience of both local and foreign property investors alike.

“The main aim of the 2014 Uniquely Property Showcase is to showcase a diverse array of projects and developments that would appeal to all walks of life. Whether you are newly-weds in search of their first home or an expatriate seeking for an abode for their retirement, there is something on offer for everyone.”

The most prominently featured projects and developments include Best World Realty’s Mines Waterfront Designer Suites and Woodsbury projects in Klang Valley and Butterworth respectively. Not to be outdone, the much lauded Sunway Group will also be showcasing its eagerly anticipated Bukit Mertajam and Batu Maung based projects, the Sunway Wellesley and Sunway Cassia.

There are also a variety of projects based in up and coming property hot spots such as the isle’s rapidly developing Ayer Itam, Balik Pulau and Sungai Ara areas whilst well to do visitors seeking for foreign property investments certainly should check out exhibitions by TFDC and Handle Property Group for the low down on delving into the
Canadian and Australian markets respectively.

Previews aside, the showcase also offers patrons a plethora of information on the ins and outs of today’s property including advice, tips and consultancy on just how to go about making the most of your investment from some of the industry’s leading experts.

“We are well aware that many Malaysians, particularly middle income earners have their concerns over the consequences of next year’s GST implementation and how it affects the market. The showcase is a great opportunity to learn more about it as well as grab the best deals on your dream property prior to its implementation,” explains Michael

Visitors will also be in the running for exclusive prizes and gifts as the organizers have set about crafting an array of lucky draws, contests, early bird giveaways and pre event Facebook offers.

The organizers, Unico Events Management, are made up of a team of dedicated and professional event enthusiasts with vast experience in planning, managing and carrying out unforgettable and memorable events ranging from large scale exhibitions to dream weddings and private functions.

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Buying a property – Way too Far, too High and too Soon. What’s your reason?

October 26th, 2014 2 comments

by Charles Tan

Just last week, someone told me that no one should buy properties if they are not ready. I asked what does it mean by not being ready? He said, lots of reasons, especially these days when the money is insufficient and the cost of goods are all so high. Furthermore properties are also so expensive. How to buy? I immediately showed him and browsed for secondary properties below RM300,000 and chose Selangor. I said, there are still MANY choices. He said, who wants all these old properties. The young people nowadays prefer new properties. Haha. Ok, I said nothing further. Well, just to reiterate three points why people said they did not buy yet.

Too Far – Unless you buy in a place without roads, it is very hard to find a ‘too far’ place for property. Even property developers would never build in places whereby it’s impossible to access. Think about it. Many years ago, Mon’t Kiara was nothing more than just……. nothing. Sunway was nothing but mines, mines and mines. You only go Sungai Buloh only when you really have nothing to do. Today, these places are still growing, especially in terms of price per sf. Even Rawang is now firmly into the picture especially with Rubber Research Institute of Malaysia having moved out and leaving a huge and prime piece of land for development.

Too expensive – I remembered when condo prices hit RM250,000 in Penang many years ago. Imagine this, in 2007, RM237,000 condominium, with FULL FACILITIES, I could wait for over 1 month before going back to buy back the exact same unit! At that time however, everyone was saying, how can a property without a land of its own be so highly prices? Local Penangites especially was the most critical as they have never seen condo prices being close to RM300,000 for a high level unit. Today, even RM500,000 for a 1,000 sf condo is considered cheap if not very cheap. Availability is nearly none. I am talking about Penang island.

Too soon – This has no meaning, truthfully. Buy if you can afford. Not buy things which stretched you thin or speculatively buy. Thus, the question of too soon does not appear. It’s just a question of can you afford it at that point in time. What age should you buy? 30? 40? No one can answer because everyone is different. Some may be lucky to have support from ‘PAMA’ (father and mother) bank so you can buy slightly bigger but if you are ready to buy instead of rent, you should proceed. If you do not, the money saved will go to Iphones, Samsung Notes etc anyway.

Property may not be for everyone because it’s very sticky. It may be high risk if you bought wrongly and many other negative reasons. How about investing in REITs? It’s safe, it’s easy to buy and it’s affordable and low risk. Alternatively unit trusts or even PNB’s funds. Diversification is key to lowering your risk. Please do not speculate. Happy investing.

>> This opinion article comes courtesy of Charles, the founder of He is popular for sharing his thought on property investment mostly based on his own 11 years experience as well as from all the readings and conversations with property gurus in the industry. (Source)

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Demographia: Malaysia’s residential housing market ‘severely unaffordable’

October 25th, 2014 No comments

When middle income professionals are unable to afford their own home based on a single income and have to team up with either a spouse or another person to qualify for a mortgage loan, then it is a sign that the unaffordability of our housing market has become critical.

A finding by US-based urban development researcher Demographia reveals Malaysia’s residential housing market is “severely unaffordable”, even more out of reach than residents in Singapore, Japan and the United States.

Demographia’s finding, cited by Singapore’s Straits Times in a report on Oct 14, rates housing as severely unffordable if the median of house price to annual income is 5.1 times.

Malaysia clocked in at 5.5 times, showing many Malaysians continue to be locked out of the housing market, compared with Singapore’s 5.1 times, while the United States’ and Japan’s housing markets were found to be “moderately unaffordable”.

Public interest group, National House Buyers Association (HBA) honorary secretary-general Chang Kim Loong says Demographia’s report supports HBA’s own finding that house prices, especially in the urban and sub-urban areas, have risen beyond the reach of many average Malaysians.

“For the past few years, HBA has sounded the alarm on the risk of a “homeless generation” made up of a growing number of young Malaysians especially the lower and middle income groups who are unable to afford their own home. When this homeless group grows in number, it can give rise to many other social problems,” he warns.

Siva: ‘The fact that salaries have not kept up with the upswing in property prices have further worsened … the situation.’
Chang says when even middle income professionals are unable to afford their own home based on a single income, the situation has become critical.

He says unless one is willing to be tied down by a long-term or back-breaking mortgage or mortgages, the high residential prices have rendered buying a house an increasingly uphill task, if not an impossible feat for the many lower income and average Malaysians.

“The skyrocketed prices have driven house buyers to take back breaking mortgages and many needed to combine their income in order to qualify for a mortgage, thus leaving them with very little or no savings after paying the monthly instalments and other basic necessities.

“This will place families at risk as they could fall into a deficit situation if any sudden emergencies happen to either of the borrowers,” Chang says.

He points out the possibility that in the event these borrowers cannot afford to pay their instalments and the banks are forced to auction off their properties, “there is a risk of a property bubble bursting, just like what happened during the sub-prime financial crisis in the US.”

“The borrowers and their dependents will also be faced with financial and emotional crisis that befalls their foreclosed property. Foreclosures can devastate a family’s economic and social standing, leaving them poorer instead,” Chang laments.

Chang says just six years ago it was still possible for a single middle level manager earning RM5,000 a month to buy a new double-storey link house in Kajang for less than RM250,000, and for a single executive earning RM3,000 a month to buy a new condominium in the Old Klang Road area for about RM200,000.

“Today, a new house in Kajang are in excess of RM700,000 but a middle level manager is just earning RM6,000 or thereabout a month. Recent launches of condominiums around Old Klang Road area are in excess of RM600,000, while the average salaries of executives are still around RM3,500 a month,” he laments.

He believes the maximum price that households with an monthly income of RM10,000 should purchase is only RM360,000 (RM120,000 x 3x).

“HBA has always stressed that affordable housing should be priced around RM150,000 to RM300,000, and not more then RM400,000 even for prime locations. Given that annual household income uses the assumption of two working spouses, there is a critical need for properties priced at RM150,000 to cater to single families and adults.

“We urge the government to further lower the threshold of affordable house price to between RM150,000 and RM300,000, and not more than RM400,00 even for prime locations,” Chang adds.

Chang says these houses, with minimum built-up of 800 sq ft and three bedrooms, need not come with fanciful finishing, but have just the bare necessities for a family’s comfort.

Stemming the greed

Malaysian Institute of Estate Agents (MIEA) president Siva Shanker concurs that the unaffordability housing issue has become critical over the past three to four years due to the sharp upswing in house prices.

“It was driven by the low entry costs with schemes such as no need for downpayment, developer interest bearing schemes and free stamp duty and legal fees, Although the Government has introduced various cooling measures and more responsible bank lending guidelines which has brought down the number of housing transactions, prices or value of houses still remain high.

“The fact that salaries have not kept up with the upswing in property prices have further worsened the unaffordability situation,” Siva explains.

HBA’s Chang points out the risks posed by “Investors’ Clubs” or “Millionaires Clubs” which are basically syndicated speculators incorporated by some ingenious individuals.

“They work in cahoot with developers, valuers and banks. Speculative buyers may be caught by the latest round of cooling measures. How the situation will pan out will depend on the holding capability of these speculators of which most of them may not have. Come hand-over time when it is time for these “investors” to flip their purchases, there may be a shortage of buyers for these properties, most of which were transacted at inflated and not real market value prices,” he warns.

Siva opines that the imposition of real property gains tax (RPGT) to tax gains from property transactions should be counted from the date of completion of the property and not from the signing of the sale and purchase agreement as what is being practised now.

This is given that it takes three years for high-rise residences to be delivered to buyers upon the signing of the sale and purchase agreement, and two years for landed property. Chang says the severity of the housing crisis for many Malaysians today calls for a workable housing delivery model to be put into action urgently before the problem spills over and cause more social problems in the country.

Housing the people has to be made the top thrust of the government and all possible measures need to be put to work fast and bottlenecks must be promptly addressed.

He says much more can be done to ensure a sustainable and orderly housing market for the people, stressing that holistic and concerted efforts need to be adopted.

“However, very often policies adopted are more for political expediency rather than for the betterment of the people.

“We need a single umbrella to monitor, regulate and police the performance of the various agencies that are entrusted with the role to ensure affordable housing index are met and properly distributed to the deserving ones. They must build the right quantity of the right property, at the right location, for the right populace, and at the right price.

“There must be full transparency on the location, number of units, registration and balloting process to ensure fairness to all eligible buyers,” Chang stresses.

A single database will enable individuals to learn about the availability of the affordable housing in their communities or in the communities they planned to move to, and understand financing options avail to them.

Siva also calls for a central planning and delivery agency to plan and coordinate all the affordable housing needs of the people.

“The whole process should be totally transparent with a master registry to record all the database of applicants and successful candidates. There should also be a moratorium period of up to 10 years to ensure that the successful candidates offered these affordable housing will not be able to dispose these homes for quick profit.

“The federal and state governments should provide the land and other forms of incentives to encourage private developers to lend their support for these affordable housing schemes,” Siva says.

Chang agrees that giving incentives to developers that build affordable housing will motivate them to throw in their support to build more of such housing units, adding that building up the infrastructure connectivity to the still relatively undeveloped areas will make these places more accessible and improve demand for property in those places.

“HBA has proposed to the government to take the lead by unlocking more of its vast land banks to build affordable housing for the people.

“The reason why developers are not chipping in to build more affordable housing units is because of the so-called profit maximisation by industry players. It is either high-rise multiple hundred units or high-end luxury units. Very often it is a combination of both – luxurious high-end units.I have not heard of developers building single-storey terrace houses that were so prevalent in the past. Developers are refusing to build such price and low margin items and will rather focus on higher margin items. With land being a scarce resource, developers will maximise the value of their land banks.

“If the land comes from the federal and state governments, private developers will be more willing to throw in their support to develop affordable housing for those in need,” Chang concludes.


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