Looking after the affordable housing community
Measures to curb speculation in the property market and cross-subsidisation do not make for a healthy property sector in the medium to long term, according to the Real Estate and Housing Developers’ Association of Malaysia (Rehda).
Rehda president Datuk Seri Michael Yam drew attention to the affordable housing segment, which suffers the brunt of such measures like the real property gains tax (RPGT) as well as the impact of cross-subsidisation from the low-cost segment.
“Property speculation is in hotspots, not among the affordable housing community, but if the Government continues to have tightening measures, then it could affect 95% of the market,” he said at Rehda’s 2013 first-half property industry survey, noting that the secondary property market, for example, would not be able to sell well.
“We need to examine carefully the various categories of buyers and speculators and prescribe a more focused action plan against the right people,” he said, explaining that the broad brush-stroke approach of dealing with speculators had unjustly impacted other asset classes as well.
Past president Datuk Ng Seing Liong added that the hoo-hah about property price hikes was not reflective of the whole market, as steep rising prices occurred only in certain hotspots.
“Price hikes in these hotspots were reflected in the media and then caught by house buyer associations, which started asking the Government to clamp down on property speculation via the RPGT and other tightening measures,” he said, “Remember, these people are buying into a lifestyle, and hence, the price has to go up.” Ng noted that there were reasonably priced basic houses out there and that there was supply in the secondary property market. “The choice is still with the buyer, they should not just claim that prices keep going up.”
He also commented on the build-then-sell (BTS) mechanism, which he believes will negatively affect house buyers in the end, as supply falls subsequently.
“With BTS, when we start restricting supply, house prices would go up.”
Aside from the curbing measures, Yam also pointed out a need to revise the cross-subsidisation, which has also led to swelling property prices across the board.
“The low-cost subsidised housing is sold for RM42,000 when the building cost is RM100,000. So, who is paying the difference? The subsidy is passed through to other housing categories and subsequently, those who buy in these other categories,” Yam said, adding, “Thus, prices have gone up.”
To address this issue, he recommended that the Government focus on affordable housing, which could be built without a loss so that developers need not pass the cost to other buyers. “Now that low-cost housing is no longer required, the Government should focus on affordable housing, be it through the 1Malaysia Housing Programme, or PR1MA, or even developers,” he said.
Source: StarProperty.my
Agreed with this guy, I think increase in RPGT or other curb to reduce the property pricing is not going to work, What need to be done is take action on property investment clubs and the sifu that organizing seminar and collect money, fees from member and same time brainstorm this ppls to enter property bulk purchases program with comes with discount, so this developer are giving more discount to this club member, i get to know now the target this to newly graduate group, pity those ppl, hope they never put them in big trouble in future. This activities need to monitor by BNM so that the household debt can be reduce and property became more affordable.
want to increase rpgt better increase to 30% for those property sold out within 3years time, we rakyat support you, we know goverment need more money now, than only will be effective.
“The choice is still with the buyer, they should not just claim that prices keep going up.”
Cannot afford, buy LMC.. Stop complaining.
Can afford, buy condo.. Stop complaining.
No problem affording any property, just buy anything.. Stop complaining.
Pay for what you need not what you want.
If you desire something you want, then buy and stop complaining.
@HUAT,
Unfortunately that should not be the way it works, because it is not durian…:)
It doesnt end with
“Pay for what you need not what you want.
If you desire something you want, then buy and stop complaining.”
Next is to work hard to achieve your dream house. Stay competitive and be better!
By all means do whatever you need to do. After all its your choice!
Complaint complaint complaint wont bring you anywhere. Specially in this forum.
The Edge report mention increase on fuel price will cause the inflation goes up to 2.3% by end of 2013 and expect to reach 3.5% by next year end. What will be the impact to property market, Price will continue up?
Government never pin point them self as they will ask developer to upgrade this…upgrade that…for existing road/drain/treatment plant/ TNB substation.
All the cost will be absorb by house buyer in future, cost increase not just material, but the subsidy n fee’s need to pay for local council.
Anyway,,,,, I still look for better investment,,,But out of Island area.
Island ROI is lesser now compare to Mainland.
Agreed Penang Island rental return rate not attractive anymore, very nice seaview at gurney area renting became very low, even local ppls afford to rent. The service apartment around tanjung tokong just below RM100 per day.
I diasgree. I rented my Brezza for RM5000/month and my Quayside for RM5500/month.
@Jeremy Tan
Try find yourself how much rental in Mainland Condo and convert in ROI for the building value u have now.
I can get easily 8-9% return with standard renovation.
I don’t want to said which condo here as i was finalist my deal with existing house owner.
Mainland just like a lake full of big fish but very few little fisherman here.
Ha ha ha…
I have 3 unit Condo in Mainland at difference location with OC.
All been rent out…
2 Units in construction, expected will get the key by next year.
1 in nego with existing house owner, got tenant staying inside but i will ask the family to move out and renovate it later.
All Sea View, Quiet and Most important…..Cheap.
@Jeremy Tan
Jeremy is your penthouse ?
How come mine one only rented for $3k
I bought brezza 1450 sft block A for RM500K. Rented for RM5000. So tell me, how many % is that PK LULU?
Quayside RM935K, Rented RM5500….
i guess i am lucky : )
Mainland i have no doubts u can get such rental but in terms of appreciation, i believe my condo has easily doubled and could easily triple in another 6 years time.
@Steve
Coz you dont have the power to negotiate, this is very important when bargaining. You just dont have it, the bargaining power. No offend ya.
btw i am just sharing not trying to boast ya….later people have misconception and start firing
What Jeremy and lulu wrote are good. Their comments are constructive and competitive enough to drive others to invest in property for better rental yield. Of course we can see the battle between island and mainland topic is here again. Then again, this is exactly the type of discussion we should have. Not bubble burst la.. Economic crashing down la which personally to me is negative with all the complaints. Coz in the end, we as a malaysian would suffer.. All for the sake of some selfish dude out there who wants to get a cheaper property price during lelong.
If you have a bunch of cash waiting for such crisis to happen to get a lelong hse, isnt it better to venture into business? Some claimed to have invest 1Mil and able to get 70 to 80% return every year. Sounds good right?
So who else able to get good rental yield?
@Jeremy Tan
How come I cannot get water fish to pay me 5k for my Brezza? Still struggling to get a tenant to pay me 2.5k a month.
Ya, me too cannot find tenant for 3k, hw this guy can rent for 5k, better check ur unit worried u rent to wrong ppl, doing illegal activities.
We see funny funny comments and funny funny thing question, either u take it or leave it. U gain nth by asking a stupid question and giving a piece of shit advise. Its his unit and whether he want to boom or for real, just leave to him. That why we penang lang always stuck in a traffic jam becoz of this kinda of people mentality. Back to the topic, for yrs to come mainland will be a place to invest and will have a better price appreciation and rental yield but it will take time.
Sorry my bad for not explaining properly, it suppose to be we penang lang stuck in a traffic jam for hours becoz of a minor accident coz of this kepochi people.
@Vincent Tan
Corporate tenant. Company pays.
I just hope properties price will keep increase, maybe 5k to 10k psf, like tht our country only can become high income country ma.. That time, even ang mo people come here will say the standard here is high, i am very proud to be citizen here.
@Jeremy Tan
Brezza = 12% gross yield, then subtract 4.5% interest, 1% maintenance fees and general maintenance, 1 % for professional fees like property agent, accountant so about 5.5% net, not as good as 70-80% return in Business….
Quayside = 7% gross yield, then subtract 4.5% interest, 1% maintenance fees and general maintenance, 1 % for professional fees like property agent, accountant so about 0.5% net, Very poor return if you ask me….
Now you will probably say what about the capital appreciation??? Well what about it??? If your an investor then this is not a concern all you care about is ROI from the income the property produces… Otherwise your just a speculator hoping for capital appreciation.
@Economic Crisis
Bought cash for brezza.
20 percent loan for quayside.
I dont consider myself a speculator, I dont plan to sell, didnt buy in the first place to speculate. Just like the location and decided its within my budget. Even if I do sell I pay 0 percent rpgt for brezza since its more than 5 years already.
However I believe investor and speculator expects capital appreciation at the end of the day. Its part of the ROI.
Quayside 1.5 more years to go is more than 5 years.
Just sharing.
@Jeremy Tan
You missed the point the comment was wether or not Penang property made a good investment and had a good ROI… It did a few years ago but not now… What is your Bezza property worth now what would the yield be based on the 5500/mth. What would the net return be if some one was to buy from you with a 90% loan???
Why would anyone want to buy from you if the ROI is not that good unless they buy from you at 500k to get the same ROI as you do now….
My initial point was to disagree with some that the rental for my area is bad thats all. You came along and told me its a bad investment plus I shouldnt take capital appreciation into account otherwise I will be a speculator etc.
I am not sure who is missing the point here.
I did state my entry price and the rental I am getting. I believe I have been quite transparent with my invesments.
My main point was to say that you can fetch good rental in tg tokong.
People might be buying at the current price because its within their budget and they like the area, price could possibly sustain and appreciate if we have enough people moving to this area. That’s all.
With STP2 coming up, in 6 years time the price could probably be worth more than the current price.
If you sit around and speculate prices will fall then you are entitle to that as well.
One man’s food might be another man’s poison right.
As long I know my 2 feet is on the ground. Before I buy I make sure I can afford ot first financially.
I am not denying that property prices are expensive now.
Hence I did say I am lucky. I guess my timing was right when I bought.
@Jeremy Tan
This funny ppl come across and don’t know anything and just use their finger point to ppl without filtering from their mind and talk and talk. Please!!!
News from my property agent fren, not sure true or not
Today latest news:
Proposal on RGPT:
– Property sell within 2 year, goes up to 30% tax
– property sell within 3 yrs, is 15%
– property sell within 4 yrs, 15%
Loan amount reduce to 60% for 3rd property
Stamp duty increase:
– 5% of purchase price for 3rd property
– 7.5% for 4th property
– 10% for 5th property and beyond.
All, take note on today news.
@Patrick
Cannot be lah.
If like that Kia Su better proposed that:
buying 3rd property–>Go to jail 2Year
buying 4Th property–>Go to jail 3 Year.
Property agent dunno nothing one, they are expert in bring us round theGarden!
@Jeremy Tan,
You are very lucky indeed. Loaded with money, buy property with cash, buy at right timing, after that can boast on blog etc….:)..Lucky guy, I really envy you. But I think due to your luck, a lot of other people become unlucky. They can no longer afford a property in Tanjung Tokong.
@Lau Lang,
Possible ah. Ah Jib kor under a lot of pressure from rating agency to get the finance in the right direction. If not, they will downgrade Msia again until interest rates go high high. A few things Ah Jib kor must watch out, debt levels (1) household debt high, so must do something to address this, and housing price has a lot of play in this (2) Gov budget deficits, ah this one must cut subsidy loh .
Kanina already! liquidity already running low with QE tapering, sommo ask him to cut subsidy and watch out debts. P*k*mak liao! If you ask him to go vote on Syria attack, he sure vote attack already, so that crude price go up, can get some handouts from petonas.
I am not sure about buying property in cash… Maybe if too loaded why not? Na…. For me, buying a couple by splitting the up front down payment will definitely be a smarter story to boast isn’t it? But then again, if you are overly loaded why not isn’t it?
I am just sharing, not trying to boast.
Recently managed to help a friend buy an apartment behind island plaza for rm180k a month before the elections and it is being rented out for rm1000.
What I am trying to say is that good locations can fetch good rental yields.
@Jeremy Tan,
Wa lau eh, another high yielding story. I know you don’t like me, but I promise from now on I won’t say shitty things to you. Will you help me find a high yield property with good future capital appreciation?
Sincerely,
Your envious admirer..:)
@Jeremy Tan
Mind to share which apartment is that?
@Jeremy Tan
Hi Jeremy, can we have a little bit of your tipsy?
@Jeremy Tan </
Where is this high yield apartment in Tj Tokong? some many waterfish meh? walao eh, better than my favorite N-Park. Last time N-Park use to fetch good yield, 7 years ago price only 150K and can get up to 1k rental depends on renovation. Nowaday N-Park selling price already 300k but rental still same.
By the way, I agreed with you on the Breeza price appreciation. Even if you buy one unit just to keep a secret lover and pay her RM5K every month. After 5 years sell the house and earn 300K, can cover for the past 5 years living cost for the secret lover d…lose nothing..
From what i know only the low cost flat Palm court at tanjung tokong are selling for 200k.
How true is this news.
i heard same news from my fren this morning, mention 60% downpayment for third unit purchased. Tax 30% for those selling within 2 year – minimum must wait for 3 years to complete the project dont think anyone want to sold out within two year.
This proposal in the end only the government is the winner. Not really help much to control property price go up
we all hoo hah here and there to boost the prise, ended up goverment easily sweep away most of the profit by inreasing RPGT..LOL
Goverment need more money to improved our economic, increase Fuel price, increase RPGT, stamp duty, most probably the OPR will remain 3.0 rate till end of this year, tomorow for sure BNM not going to give rakyat one more shock by increase interest rate. This is good time to increase RPGT as we know the house price mark up happen after 2010, those property launch on 2011 to 2012 with higher price will obtain OC by end of this year or by next year, those property purchased for speculation will be affected. Goverment can make a lot money by this implemendation.
@tomyam
Palm court thats right!
It has been 5 years already, so the original owners can start selling their apartments.
However, you have to be a first home buyer that my best friend qualified as one to buy a unit here.
Made the appointment took him there and found this beautiful unit with sea view and the entire seri tg pinang township view of straits quay and gurney drive as well! 750sft corner unit facing those views! RM250/sft! He is a happy man today.
Just 1 month before elections, found my best friend that unit. It was going for RM180K nett, furnished and with air cons installed. Tenanted to musicians working at Nueve Precinct 10 for RM1000 a month. A pretty good deal. The view i have to say is priceless. Since his is a corner unit, he can have a panoramic view of gurney drive and straits quay.
So, 2 months after elections it is now RM260K….
sorry size of apartment is only 700sft