Chor sees no property asset bubble

Malaysia does not foresee a property asset bubble in the near future unlike China, Hong Kong and Singapore, which have such concerns.

Housing and Local Government Minister Datuk Chor Chee Heung said that many local developers were still rushing to submit their applications for various projects.

“No, I don't think so because we have not reached that stage. If you think this (slower property sales) is the sign, then why are developers jumping in to continue to build?” he said after the opening of the 19th International Real Estate Federation Asia-Pacific Real Estate Congress 2011.

On another note, Chor said the increase in the real property gains tax (RPGT) was among the measures taken by the Government to curb speculation.

The Budget 2012 proposed that the RPGT on properties held and disposed of within two years be raised to 10% from 5%.

Chor said although the additional 5% was not too much of a deterrence, it would not give much room for speculators to buy property and flip it shortly, adding that the additional tax would not affect genuine home buyers.

Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, in his speech at the congress, said the real estate and business services sector was projected to expand by 6.8% and 5.7% respectively in 2011 and 2012.

“As we move forward, we cannot abandon the underprivileged and the poor. In this respect, we have put in place numerous measures to ensure that there is adequate supply of affordable homes. In March this year, the Government launched the My First Home Scheme.

“Under Budget 2012, the ceiling selling price of these homes has been raised to RM400,000 from RM220,000. The new ceiling would allow a greater number of aspiring homeowners to take advantage of the 100% financing scheme by participating financial institutions,” Husni said.

He also said unique public-private partnerships would be forming, where the Government would provide the land on which private property developers could build homes for the less fortunate group. - By The Star

8 comments

October 16, 2011 at 9:32 AMObserver

It seems that our government is always in favor of property inflation, this can be seen in the recent budget where there is only name-sake effort to curb property speculation. By raising the loan value from 220K to 400K, by raising the salary of government staffs & pensioners and giving one off payments are in fact contributing to inflation but not solving the root causes of inflation.

Why Chor does not aware ?
The real fact is knowing the imminent slow down, developers are jumping to lauch their project quickily now to grab as much sales as possible before the full impact of global effect and the slow down in 2012.

I wonder making speculative statements are the roles of these ministers ????

 
October 16, 2011 at 9:40 AMObserver

The 10% RPGT for first 2 years has no impact. Most of the properties will be sold after the project completion which will take 2 years time.

 
October 16, 2011 at 2:16 PMAnthony

Fully Agreed, Observer.

 
October 16, 2011 at 5:43 PMyeo

looks like the government has no real intention of curbing the escalating house prices, main wayang kulit saja, actually enriching themselves, the developers, bankers ... at the expense of the increasingly debt-ridden people..

 
October 16, 2011 at 6:17 PMWK

either the government is plain stupid or has vested interest covertly helping the greedy developers and bankers to continue 'robbing' the people
singapore, china & hong kong have introduced a slew of far more stringent measures to curb speculation and escalating properties prices
it seems like our government is practically doing nothing .... just standing there and just watching the 'looting' going on .... terribly disappointing !!

 
October 16, 2011 at 7:44 PMObserver

Redha president has all the reasons to justify the property price have to go higher to the extend of using excuses like the developers these days can only afford a net margin of about 5 to 10 %. But he did not mention the net margin is the one reported, but most of the margin already gone into perks, alllownaces, entertainments etc on the expenses of company.

http://www.apartment-penang.com/2011/09/house-prices-to-rise-costlier-materials.html

If the net margin is so low, why Chor has all the evidences to justify developers are jumping in to continue to build, it must be a very lucrative business with the crazy prices, even companis which are not in the business before also build houses nowadays

 
October 16, 2011 at 10:54 PMjeremy tan

Obviously the government doesn't plan to do anything about property inflation. Khazanah, EPF, Amanah Saham, LTH, PNB, LTKN....every single freaking fund has invested heavily in property shares such as SP Setia, E&O, Bina Puri, MRCB, UEMLand, Sime, etc.

It is not in their vested interest to curb property prices.

 
October 18, 2011 at 7:42 AMObserver

This is another example that the our ministers are good at making speculative statement to create more inflation
http://www.apartment-penang.com/2011/04/inflation-and-demand-to-lift-property.html