Indefinite freeze on luxury properties
The government today announced an indefinite freeze on the development of luxury properties worth more than RM1 million per unit.
The freeze, according to Second Finance Minister Johari Abdul Ghani, had come into effect since Nov 1.
He said Cabinet had recently scrutinised a detailed central bank report published in June which revealed an oversupply of luxury units.
“The Bank Negara report takes into account high-rise condominiums, shopping malls and commercial units, including those that are worth more than RM1 million,” he said when contacted by theSun.
However, Johari said this was merely a temporary measure until all the excess supply is cleared and there was a rise in market demand for expensive properties.
“We are worried that an oversupply of such development would have an adverse effect on the economy. For now, we want developers to focus on the development of affordable homes, especially those priced below RM300,000 per unit.
“At present, there is a disparity between demand for affordable homes and the supply.”
He said this disparity needed to be addressed immediately as there was still a huge demand for affordable houses.
“However, as soon as demand for luxury homes pick up again, we will review the freeze,” he added.
In its report, Bank Negara said Malaysia’s property market was facing an oversupply of non-affordable homes and idle commercial space, while demand for affordable housing was not being met.
Source: TheSunDaily.my
Should actually freeze those above RM600,000 condo particularly in Penang.
that mean the existing condo above 1mil will increase price lo due to less supply
@min
This might not necessarily be good as it would be priced out of reach of even more people as it already is.
Not much 1mil properties are launched in Penang market, if we looking at IJM the light new development and also E&O, they got their own markets.
Even the price shoot up or down, their sales still remains as good. For me, even 800k condo can be considered as luxury condo. 600k is just a normal condo and (400-500k affordable house) and etc….
Means no more 1mil properties in future, max price only can set 999k, gd news
@Owner
This moratorium will only be temporary lah. When market recovers things will return to mean.
For sungai ara + mainland area, not much impact because condo selling price there hardly reach 1 mil. So you will still see a good new supply there. For prime area like gurney/tanjung tokong/bunga, new development will have 2 main criterias, namely less than 1 mil + smaller units of 1000sf for new condos. So it will become a luxury to own bigger spacious condos in this area.
Good move by the government, this should have been done long time ago starting with projects above 500k