Moves to cap property prices could backfire
August 10, 2013- Featured, Investment.
FOOD FOR THOUGHT by 'Malaysia Condo King' Datuk Alan Tong Kok Mau | feedback@fiabci-asiapacific.com
http://www.starproperty.my/index.php/artic...could-backfire/


‘Cooling off’ measures choke supply

Imagine if a regulatory body decided to limit the number of durians purchased by each individual in order to lower the price of durians so that everyone would have the chance to taste the King of Fruits. What would happen?

If this campaign was successful to the point that prices fell to close to or below production costs, durian planters and sellers would rather walk away from their plantations and let the fruits rot on trees than to harvest the fruits, transport them to towns and sell them at a lost. Economics 101 tell us that when supply reduces, price increases.




This is what’s happening in the property industry especially in Asian countries today. As a developing and booming region, Asia has seen lots of activities in the property industry in the past 10 years.

The housing price increase in this region is also more significant due to rising input costs, strong economic conditions and growing populations.

To prevent the property prices from surging further due to growing demand and worldwide quantitative easing (money printing) government policies, several governments in this region have introduced various “cooling off” measures with the most insistent being China, Hong Kong and Singapore.


CHINA

In China, the State Council stepped up a three-year campaign to “cool off” home prices in March. Measures included raising first-time buyers’ down payments from 20% to 30%, and second-home buyers’ down payments from 50% to 60%, and ordering stricter enforcement of a 20% capital gains tax on sales. The government also limited home purchases in certain areas, tightened credit-quota limits and raised benchmark lending rates.

However, according to a recent report by the National Bureau of Statistics (NBS) China, residential and commercial property sales totalled 3.34 trillion yuan (RM1.77 trillion) in the first six months, jumping 43.2% compared to a year earlier.

The pace of China’s year-on-year home price rises in April, May and June was also the strongest this year in spite of the March initiatives. Average new home prices in 70 major Chinese cities climbed 0.8% in June from the previous month based on data released by NBS.

New home prices rose 6.8% in June compared to a year ago, the sixth consecutive rise and the fastest pace since January 2011.


HONG KONG

In Hong Kong, the government introduced a series of steps to curb prices since 2009. Its measures included a 15% property tax on foreign buyers, mortgage restrictions and taxes on quick resale.

The government also limited the maximum term of all new mortgages to 30 years, and mortgage payments for investment properties could not be more than 40% of the buyers’ monthly incomes, compared to 50% previously.

According to a Knight Frank report for the first quarter of 2013, property prices in Hong Kong were 28% higher on average, compared to one year ago despite measures to “cool off” escalating prices.


SINGAPORE

As for our neighbouring country Singapore, the government just unveiled its eighth round of “cooling off” measures in June. The new rule states that home loans should not exceed a borrower’s total debt servicing ratio of 60%. Lenders will also be required to deduct at least 30% from all variable sources of earnings, such as bonuses, and rental revenue when determining an applicant’s income streams.

Prior to this, the Singapore government made seven attempts to cool off the residential real estate market since 2009. In January 2013, the government implemented an extensive round of tightening measures by imposing higher stamp duties, lowering loan-to-valuations for mortgages, and implementing stricter rules on permanent residents (PRs) buying their first home.

Nevertheless, despite a series of “cooling off” measures, Singapore private home sales in January 2013 continue to hit a high note, with a 42.8% increase from December 2012, and a 7.5% increase year-on- year.


MALAYSIA

In our home country, the Government has also introduced a number of “cooling off” measures.

These include the 70% loan policy (LTV) for third property purchases, requiring the housing loan limits calculated based on net income instead of gross, and the loan tenure reduced from 45 years to 35 years previously, etc.

The “cooling off” measures introduced in various countries are believed to have some impact when they were first implemented, however the overall effectiveness has yet to materialise.

While we understand the good intentions behind these measures, they result in further heating up of the market because the fundamental issue of the shortage of affordable housing is not addressed.

There is fine line between “cooling off” and heating up the market, when the market is having a strong, genuine demand. “Cooling off” measures will constraint supply, and when demand is higher than supply, the prices will eventually increase.

In Malaysia, according to NAPIC, there is only a supply of about 100,000 new houses a year throughout Malaysia, while the demand in Greater KL alone is projected to be an additional one million units if Pemandu achieves its target of increasing the population from six million to 10 million by 2020.

Therefore, if our authorities are pondering further “cooling off” measures, it is beneficial to look at the real experience from other countries and not just the “short term” effects, the different environment of property development in our country should also be taken into account.

The original intention of controlling the price of durians in my earlier story is to allow more people the chance to taste this unique fruit at an affordable price.

However, such good intentions often backfire and worsen the current conditions. “Cooling off” could eventually lead to heating up!


Property developer and group chairman of Bukit Kiara Properties Datuk Alan Tong is also FIABCI Asia-Pacific regional secretariat chairman.

Datuk Alan Tong's view must respect although he may have vested interest...

besides some filthy rich young and old, the average malaysian is already quite poor, already in a lot of debt.

only way for the poor fella to buying a home is more n more debt. no gud la... gud for alan tong et al maybe...

1st, remove all crony margins and commissions in the land and approval deals.

2nd, fed gomen need to bear some of the infra-utility costs and not pass to dev to pass to buyers.

3rd, stop or at least reduce the special discounts for special species, stop letting others pay.

4th, raise rpgt and stop the greedy from taking it all.


but in boland, all that is almost impossible la....

This post has been edited by AVFAN: Aug 11 2013, 06:27 PM

In Bolehland...

To control the property industry is very simple.

An astonishing % majority of property transactions in Malaysia is occuring amongst the Chinese despite being the minority group in terms of population.

An increase in Bumi quota would kill off the speculation and rising property prices and at the same time kill off most of our developer's customer base. THe limited supply would mean that these units will be expensive and only for some high income Chinese.

This post has been edited by accetera: Aug 11 2013, 06:35 PM

tat's precisely why the quota and discount thing is not working for the masses, only benefit a minority popn segment.

dun ever think there r no poor chinese or no rich bumis la...

no discount, just raise rpgt - fair n square for rakyat, good for gomen to get revenue, plow it back somewhere like infra.

that's the answer la.

why apply gst to tax the poor while the rich fellas keep gorenging?

This post has been edited by AVFAN: Aug 11 2013, 06:46 PM

Always wonder shouldn't the bumi discount apply to say the first 2 properties rather than being unlimited...

The "real" rich are not really gorenging yet actually... even if they do speculate, their numbers are just so small to create an impact.

Most speculator or flipper wannabes today are just me and you in this forum. The only problem is they are "over-leveraged", they treated property as a mean to earn income, and surprisingly the mass of these people are ethnic-Chinese despite they not getting discounts, etc.

Back to Alan Tong' comments, yes Malaysia is in dire need of affordable housing especially in Klang Valley where it faces a huge shortage. But the shortage is mainly amongst the Malay community in Malay areas. Example: in Shah Alam, where home ownership is not an "in-thing" yet or rather most new homes in Shah Alam are actually beyond the affordability levels.

This post has been edited by accetera: Aug 11 2013, 06:51 PM

when i say "rich", i mean incl those young 25 yr olds like u capable of borrwoing millions to goreng.

no, i dun goreng anymore.

u sure or not 25 years old can borrow millions???? even if it does, this is a rare case leh....

I'm 25 and the max all of my friends can borrow is 400k leh...

This is a capitalist society. As long as there is demand there will be continued speculation. This is demand pull. Like stock market, as long as there are buyers, price will continue to go higher and higher until there is no buyer then sellers are forced to lower their offer price. As it is seller driven, we can see price spiralling down. Just that stock market is short term i.e we will see up and down in a few days time but property market, it may take years. Well, in Mallaysia, I agree property price has moved up significantly over the last few years. It it overheated or over priced overall, I personally don't think so. One can still get a property at reasonable price like a terrace house at RM360k in Puncak Alam, condo at around RM400psf in some areas. If one want good location and cheap price then it is like wanting a Miss Universe as your wife and yet will serve you faithfully like your well trained maid and is the daughter of the richest man in the world. Got such thing meh? Want good location, compete with others and pay more. Want affordable price, don't be fussy about location and quality of development and developers. Just my views! I fully agree with the durian theory as illustrated by Allan.

irregardless of what article you have decided to post, the sad fact still remains. more than 90% of real people cant afford the ever increasing price of property. in other words, whatever article you post here, doesnt have any effect at all, because when it comes to affordability, it's a matter than you cant push it further. besides, malaysian salary cant sustain the property rise, not for majority of the people. those with vested interests can paint the picture in whatever way in whatever reasons, but trust me, the backfire unfortunately will just be backfire for a certain period of time. yes rich people can keep buying, but it only means they will "eat" among themselves

Alan Tong's comments are very fruitful that any short term measures to control the rising property prices will result in "not as expected".

The game changer is Govt must step in to participate in property development by focusing on PR1MA.

tis i m not sure if useful.

gomen n bnm need to deal with economy thru monetary n fiscal measures, for prop and every sector.

micro managing too much will lead inevitably to disaster incl damaging the private sector.

unless it is declared housing shud be a controlled item.

What are your thoughts whether PR1MA is best to solve the affordability issue?

But maybe act like HDB of Singapore but with a twist since our govt do not owned most land?

Or maybe basically just a rebranding for PPR or similar like PKNS flats?

Good summary!

It looks like Greater KL prop market will continue BBB

the crux of the problem is that there has not been a broad-based equitable rise in income in the past few decades. if there had been, the issue of rise in property prices would be less an issue.

government must acknowledge their failings here.

it is both governments and irresponsible "vested party" that fix the rising price that are responsible....one takes advantage, the other dont control much.

actually i also wonder, why is there even an option for bumi to opt whether or not to buy bumi unit with bumi discount.
i meant, if government is serious about curbing speculation, let's first understand the reason of this bumi discount.
why would they grant a bumi to buy a non-bumi undiscounted unit? after all, it's meant to 'help' bumi to own their homes. not speculate, right?
what happens when more bumi shy away from bumi units? more 'holding' to the developers?
i don't get it.

Why don't you share one of the tricks here for the benefit of all?

RPGT higher is not the solution. There are many ways to go around a higher tax imposed. Oops better keep my mouth shut

Fact 1 >>> Salaries are not rising in tandem with cost of living + appreciation of new property launches. For example, my accouting industry only gives minimum token increment every year and nowadays MNCs under shared services will CAP all annual bonus to 2 or 3 months only maximum. And promotion is super intense as almost everyone especially ladies are studying accounting/finance.

Fact 2 >>> Affordable housing are not sufficiently provided, especially the middle market (PR1MA market) that will not opt for PPR/SPNB/PKNS.

Fact 3 >>> Malaysians have to make Car Purchases as priority because the need to commute to work when public transportation system is not feasible, non-existence or poor service and poor coverage and for security reasons.


We can't be talking about one or two people out of hundreds of people.

This post has been edited by accetera: Aug 11 2013, 11:37 PM

agree with certain points especially point 3..

lets look at neighboring country.. spore..
http://www.starproperty.my/index.php/featu...ggling-singles/

Singaporeans are already feeling the heat of rising prop price to 5.5 times of annual salary..
Having a car is not as mandatory like malaysian due to good public transport.. a family just need 1 car and dont drive that often, thus ERP and petrol is not a heavy burden for ordinary folks..
Income tax is lower..
borrowing interest rate is lower than us by half..
standard of living dollar to dollar comparison, they are much lower than us..
because of their strong currency, buying imported brands are cheaper.. branded electrical appliances and branded clothing are cheaper for them base on their earning power..
However, they are already feeling the burden of escalation property price..

for us msian.. i respect..
owning a myvi, or saga seems to be normal at young age.. 1 family has few cars..
dealing with escalation of toll and petrol price..
higher income tax..
higher interest rates, but we have advantage of longer tenure.. still end with paying more debts..
cost of living really escalating.. dollar to dollar, cost of living out pace our salary..
due to our lower currency value, we are buying a lot of things more expensive base on our earning power..
and yet our price of property 5 or 6 times higher than annual salary..

when singaporean are mourning on high property price, they should see we average msian are even shittier, and we have no HDB flats.. lol

Well said..im owning a house and im waiting for right time to grab another 1. I believe property blooming will happen in Malaysia soon.

I was reading that in Hong Kong, where the new condo price is about RM10000/sf, the government is gonna create about 50,000 new homes....over a 10 year period! Malaysia 100,000 new homes in a year! With maybe 1/2 of that in Klang Valley. Population numbers and economy comparison asides, if I were a betting man, its obvious where to buy should one have the money......

Friend, 20yrs++ before, Civil engineer salary RM2000++, how about fresh grad now? It's not the property too expensive, it's just our salary/currency to low!

This post has been edited by 37 Exposures: Aug 12 2013, 11:29 AM

Based on World Bank's data - the population growth in HK and Malaysia from 2010 to 2020.

HK:
2010: 7.068 mil
2020: 7.75 mil

Malaysia:
2010: 28.4 mil
2020: 32.97 mil

HK population growth of 682k vs Malaysia growth of 4.57 mil.

HK's planned supply of 450k within the next 10 years already take into account most of the population growth (assuming 2-3 people per household). Pls read the link below - the projected supply is 450k over the next 10 year and not 50k.



http://www.scmp.com/business/article/12774...ge-rates-double

http://www.news.gov.hk/en/categories/infra...20_134804.shtml

This post has been edited by Mikken: Aug 12 2013, 11:52 AM

Cannot compare with HK and SG.

These 2 markets are very open market and alot alot of Foreign Tycoons That Become Residents, Working High Income Expats as well as Skilled Blue Collar Resident Expats.

Though Malaysia's future looks bright simply on demographics, and yes, our median population age and birth rate are amongst the youngest and best in ASEAN, we do not know whether how affordable could properties become for the mass of our population. Looking at our salary levels, I doubt most of the 4mil freshies who migrate to Klang Valley to work could even afford a 500 sf apartment in coming years.

At the same time, those who are working as Managers and those seeking for Promotions in coming years will become those people who are able to afford the New Projects. But how many are there who able to afford?

This post has been edited by accetera: Aug 12 2013, 12:11 PM

if property keep going up, wealth gap will be huge ... good or not?

What Allan Tong said about the HK property is correct or not? Or it is part of the property developers' counter arguments that our government should not impose any further measurement s to prevent property price increase....see the following articles:


http://www.themalaymailonline.com/money/ar...-enters-ice-age

.............For the second quarter, overall home transactions dropped to 11,443, the lowest quarterly sales since 1996, according to real estate services company Colliers International.

Industry analysts now expect residential prices to drop between 5 and 15 per cent by the end of this year..............

I think he meant private properties as these are measured by Knight Frank. The supply dropped and prices still increase... but could drop moving forward.

I strongly agree with your statement of "cannot compare with HK and SG".

Both HK and SG have land scarcity issue and the property market is highly regulated. Whatever curbing measure the government impose, it will not affect the market like what Ah Tong highlighted, to some extent, I feel he is over eXXXXagerating the situation. When we refer to HK and SG property market, we are generally refering to 50% of HK and 15% 0f SG private market. Most of the property hikes were caused by the inrush of new cash rich emigrants from mainland China. Most of the low and middle income group stay in the government public houses aka HDB in SG.

It is not a fair comparison to Msia market if the data is extracted from the private market of the two high income city states. It is basically comparying high income elite group to general public.

In china, similarly data from Shanghai and Beijing (which contributed the most to the transaction data base) are somehow a regulated market in a different manner. After the ridiculous property curb by communist party in 2009, most of the new development are transacted by the ultra rich and ultra powerful (political) group of people. Ah Tong intentionaly or selectively neglected the fact that the cradle city of China private entrepreneur Wenzhou is suffering a whopping 40% drop in price in 2012/13 and yet to have sign of bottom out; yet to mention the ghost city in Bayonnao, kangbashi, Xin Zheng city, Erenhot and etc.

Ah Tong is a developer, what else can you expect coming out from his mouth? same like what you listen from property agents, conflict of interest la.

This post has been edited by KLsooner: Aug 12 2013, 01:50 PM

I dont know what you are talking about..
I am talking about affordability, not talking about buying more than 1 house..

that is the irony..

SG land is limited, and houses are 5 times higher than their annual salary..

but bolehland, land is abundance.. still houses are 5 times higher than our annual salary..

This post has been edited by twincharger07: Aug 12 2013, 01:54 PM

the real durian eater will be benefited when durian buyer buy bulk from planter with intention to keep it to sell at higher price, but have to let go cheap since can't keep it for long.

Not only happening to secondary market.

Even developers themselves are doing that. They sell expensive, not all goods are sold. They hold. If they sold > 70% of their goods, the profit they make should be enough for them to hold 30% of the unsold units.

So far so good, they are doing pretty well. But their stock are pretty huge too.

back to durian thingy.. so far all planter still in the market. less supply of durian will only happen after durian hit lowest price (i cant remember when, but it happen years back when durian price hit RM1 each - cheapo one since the example using the cheap one also) due to oversupply which make planter change to other business.

+1
nowadays people must have at least two source of income in order to maintain their pocket

🎯🎯🎯

Spot On. Good one...

We need more datapoints from all parties for public dissemination and debate.

What is the gov doing about about the property situation??? All the ad and promises during GE13, but no further action or lack of publicity?

Why are there no concrete timeline for PR1MA?

What happens when "affordable and quality homes" are made available to first time home-owner citizens by gov?

Happy citizens?? Developers, happy??

I believe 5 years is sufficient time to build affordable and quality properties if they are really serious, do we still need more cooling measures? Ask Mr Alan, there is no prize for guessing his answers 😎, I sure he will provide datapoints too 📊📈📉.

What is my view? It should be win win for both the first time home buyers and property investors.

BN, why are we waiting?

We need more datapoints from all parties for public dissemination and debate.

What is the gov doing about about the property situation??? All the ad and promises during GE13, but no further action or lack of publicity?

Why are there no concrete timeline for PR1MA?

What happens when "affordable and quality homes" are made available to first time home-owner citizens by gov?

Happy citizens?? Developers, happy??

I believe 5 years is sufficient time to build affordable and quality properties if they are really serious, do we still need more cooling measures? Ask Mr Alan, there is no prize for guessing his answers 😎, I sure he will provide datapoints too 📊📈📉.

What is my view? It should be win win for both the first time home buyers and property investors.

BN, why are we waiting?

Agree. What the government is doing will only help to curb development, not demand because demand cant be controlled; population will increase exponentially; say back in the 80's 5 million adults gave birth to an average of 2-3 kids; by now there'll be 15 million adults getting married and will continue to give birth to like say, 20 million kids. Population is ever growing and land supply is constant. We observe the trend of more young graduates moving out of the rural areas to the city too, note that this number will only gets bigger. Eventually, one will need a home. Affordability is an issue hence when property prices increases, adjustment need to be made on our lifestyles > cutting on entertainment /cheaper cars/.

I ask myself la, If I dont have enough money, I can live with cheap cars, public transport, cheap meals etc etc but I cant live without a house. So the trend forward, a bigger chunk of ppl income will go to home repayment instead of oth nonsense. Hence, non- necessities industry (luxury cars; premium entertainment outlets/eateries, beauty saloons) will suffer more.. just my 2 cent la

Bro, I have more than 10 friends who went south aft studies. And most of them already owning private properties and cars by their mid-30s.

Let's face it; we have so many Malaysians who is working in Singapore compared to Singaporean who is working in Malaysia.
And those who worked there will mostly stay there rather than coming back here.
Furthermore, Singapore's expatriate community is bigger and much more affluent than KL's.

There must be a reason for all the above, right?

Correct, sir.
We will make adjustment.
We will be willing to cut down the unnecessary expenses, drive cheap cars and eat cheap meals to allocate more money for our home.

However, the question is not whether if we will prioritize owning a house, but can we afford even if we prioritize.
Let's say general Joes and Janes are earning an average of RM6k per month, but property prices (let's say) is on average RM1000 psf or RM1 mil (an exaggeration to illustrate the point). No matter how u cut and slice the budget, u still cannot make it.

If average Klang valley salary is at RM5k, then the average property prices in Klang valley should be around RM400-600k, maybe? But now I see more RM1 mil terrace houses than RM400k.

As long as the income and property prices are mismatched, we will have problems.

join income with spouse lo..thats what everyone is doing now i guess. gone are the housewives day
and more young ppl will rent..and only buy later..

True. But that is a zero sum game. 2 persons buy 1 prop instead of 2 persons buy 2 props. The pool of incomes vs number of prop remain the same. Lol.

Those owning 10 props by mid 30s are outliers, bro.
If everyone owns at least a property here, we wont hear so many concerned voices abt property and house ownership in malaysia.

Land is abundance but KV land is limited. I always say these, can buy house in Kelantan, there quite cheap. Have to compare fairly. The question is, do U guys want to live in Kelantan? Actually not a bad place to stay in Kelantan BUT again do you guys want to buy there or should I say invest there? U never know, once the oil royalty in Kelantan resolves, price there spike. Just a thought.

betul betul betul..true true true. Upin and Ipin would say that.

+1
u r very well said
some people complain on developer side, asking for project, money etc2.
some people complain on end-user side, price is expensive, price is overhike, etc2..
end up all blame the government.

people just keep talking, and sometimes not based on fact but more on their ego

i still have problem understand this durian example.

the govt know what should do.

from singapore to hk to europe, chine, and back to thailand.

all govt implement policy to make it no hard landing. so all of them is stupid and the writer is smart?

This post has been edited by tikaram: Aug 16 2013, 12:24 PM

What Datuk Alam is implying simply:

- affordable housing issue not addressed yet

- shorterm measures will force developer to reduce supply creating a price shock for well demand areas, i.e. PJ (in PJ Damansara, people can buy at whaever prices. My neighborhood everyone chasing RM1m terrace home and people can buy in CASH. And in PJ, most kids work or study overseas so loan just use their name. Lagi best if use UK payslip. Forget the bank)

This post has been edited by accetera: Aug 17 2013, 12:11 AM

You are talking PJ Damansara only or the folk in whole PJ area are generally quite rich?

This post has been edited by KOHTT: Aug 17 2013, 12:48 AM

Fuel price rise and crackdown on illegals affecting construction sector
By MARTIN CARVALHO | Updated: Thursday September 5, 2013 MYT 7:09:21 AM
http://www.thestar.com.my/News/Nation/2013...ion-sector.aspx

PETALING JAYA: People looking to own a house any time soon will have to pay at least 10% more for their dream home, according to developers.

They said the increase was due to the double whammy that has hit the construction industry – higher costs of building materials resulting from the 20 sen rise in the price of RON95 petrol and diesel and absenteeism among foreign workers because of the nationwide crackdown on illegal immigrants.

Real Estate and Housing Developers Association of Malaysia president Datuk Seri Michael Yam Kong Choy said the failure of foreigners to turn up for work was causing delays, thus adding to costs which contractors were certain to push to consumers.

He added: “The raids on construction sites have frightened even legitimate migrant workers who are staying away.

“This also happened in past raids, Legitimate migrant workers simply did not turn up for work or delayed their return from their country until the storm blew over.

“Because of the shrinking supply of workers, developers have to pay more for labour to meet contractual deadlines, failing which they will be penalised.”

Developers are bound by the Sales and Purchase Agreement and will have to pay compensation to buyers for late delivery, Yam said, adding that contracts in the private sector were awarded with no provisions for price adjustments.

While acknowledging the need to flush out illegal immigrants, he said any reduction in the number of workers would hurt developers.

On the fuel price hike, Yam said it affected the supply chain of the construction industry, involving more than 100 types of business.

Master Builders Association of Malaysia president Matthew Tee said members were complaining that their legal workers whose documents were being processed were staying away for fear of being arrested.

“Our understanding is that all foreign workers will be detained unless they can prove that they have proper documentation,” he said.

“This can be difficult as their documents may still be with their employer or immigration pending the affixing visa of stickers by the authorities.”

He added that there had been cases in the past of legal workers being detained for up to 14 days.

Tee hoped that there would be no recurrence of such instances, and warned against a repeat of the situation in 2002 when the construction industry was brought to a standstill due to a shortage of workers.

In George Town, the Penang Master Builders and Building Materials Dealers Association says it expected construction costs to rise by 3% to 5%.

Association president Datuk Lim Kai Seng said the cost of transportation was likely to rise 10% to 20%, and the prices of sand and cement by between 5% and 10%.

He said that cement now cost RM17.50 per 50kg while sand sold for RM70 per cubic metre.

Cheap housing is a thing of the past. The current trend points towards higher housing prices.

This is bullshit.
Like a bunch of kids complaining and feet stomping coz their couldn't get the toy they want.
The argument that property is expensive is NOT a new one. It has been happening since decades ago.
People will always complain. The question is what are you doing about it?

I can reiterate the fact that property WILL NOT be cheaper or affordable in the future regardless of what the gov does. HK and SG have tried and failed. At best the prices will stagnate for a little while and then when supplies dwindle prices will shoot up again.

Building affordable housing is also not the way. I mean we already have those. Its called low cost housing. You can find plenty of them in rawang and kuala selangor. Pr1ma is just another gimmick for low cost flats which i bet nobody will want judging from the demand of current low cost flats.

Learn to accept the high property prices. Rent if you can't afford to buy. Its not a god given right. If you want a decent property that cost alot then think of ways to increase your earnings capacity. Complaining and blaming the gov won't help. If you can't then maybe you don't deserve to own a home.

Told them that so many times already, they dont want to listen but keep complaining, now fuel increase and they still think property price can go down.

Sounds quite frank and direct to the truth.

It hurts Gen Y people especially those influenced by pessimissm and DDD campers.

Its the truth. They should learn to grow up.
During my time people are also complaining that property in bandar utama at launch date somewhere in 1996(?) at rm180k was so expensive because the generation before managed to buy taman tun houses for ~rm60k and that wages cannot support the purchase of houses.

Today its the same arguments only different figures.
Pointless.

And believe me, you don't want the gov to get involve. Firstly because they can't do anything to curb prices like what happened in SG and HK and two, knowing our gov, they will find ways to screw it up. In the end you may pay even more for property prices!

If you want to own one, find ways to increase your earnings. Otherwise just rent. Remember nobody owes u nothing

Hahaha..during your time. Good one. Dont have to look far back during your time. Three years ago, end of 2010, people tried to convince me not to buy any property and lucky I did not listen. Now the apartments almost double in price...and look at how jealous the DDD campers are with me and tried to look down on me and tried to to trash talk so hard, but they can't. It's the truth, they should realized they missed the boat.

And footballer if you are reading this, somebdoy offered me 650k apartment yesterday for my ayam condo...hahahaha....life is good. and the offer keeps coming everyday, why cant they just accept, I dont want to sell? But I am happy to receive their call, see how in demand the properties are.

This post has been edited by AmayaBumibuyer: Sep 5 2013, 05:20 PM

I vaguely remember Bandar Utama DSL houses in 1996 was more than RM180k already. More to RM300k-RM400k range. The RM180k ones maybe the 1st phase launch price deep inside near Damansara tol side. Not the 1 Utama shopping centre side.

But I agree with you. I also Gen X. Nowadays upon graduation, they are talking about buying properties. Our time, we don't even dream to buy property until working for 5-6 years to accumulate 10%-20% deposit. Recent years got DIBS, zero down, free SPA, 40 year loan and BLR -x%. With RM10k they can buy RM500k property. Our time, no zero entry packages, loan tenure max 20 years and interest always BLR +x%

And look at Gen Y salary. Some of them before 30 year old hit RM10k already. Gen Y should appreciate the good times they are enjoying now. Be more patient. Don't expect to buy property right after graduation. Your turn will come eventually

3 subtle event occurred this week....

1) Crackdown on immigrants,
2) Petrol price increase,
3) Announcement on slowdown of infra projects by Gov

so what is the future impact???

I just got a call from concerto.... Telling me that phase 3 got choiced units at additional discount, making it similar pricing as phase 2.... "only 20 units sold, so hurry up".

😎😎😎🐟🐟🐟🐟

No need for OPR increase, exchange rate increase etc to cool market and increase foreign confidence...

Dun think BNM will raise interest rate in Q1/2014

From STAR today

-------------------------------------

Hot Issues For Consideration

07 Sep 2013
OF late, there has been talks that the real property gains tax (RPGT) may be be reinstated in the coming Budget 2014 to be tabled next month. Real Estate and Housing Developers Association (Rehda) has written to the authorities to state their views. Bank Negara is also studying the possibility of banning interest bearing schemes. The Developers' Interest Bearing Scheme (DIBS) is said to encourage speculation as buyers need only to pay 5% or 10% downpayment and need not pay anything until the property is completed. The return of RPGT and the possible removal of DIBS are signs to prepare the property sector for the challenging times ahead, as seen by the volatile stock markets in South-East Asia. While Malaysia has to tackle a number of issues in the greater framework of the economy, there are three issues befuddling the property sector - bubbles, speculative elements and affordability. Developers want a benign RPGT regime and the DIBS to be maintained while certain quarters want the return of the old tax structure of 30% tax on profits on disposal in the first year. The RPGT is both an anti-speculative and revenue-generating measure. RPGT will play its role to curb speculation, says property consultant Elvin Fernandez of Khong & Jaafar group of companies and the House Buyers Association (HBA). During the last two budgets, HBA had anticipated a tax regime with more bite and was sorely disappointed. There was a time when not all developers offer interest absorption schemes. Today, most are pressured to do so. Says Rehda president Datuk Seri Michael Yam: "It helps people get on the house-ownership ladder." "It also nurtures speculative tendencies," says Elvin. Incidentally, interest absorption scheme was the first to be banned by the Singapore government as early as 2009 in a series of measures to cool the property market. DIBS aside, the larger issue is transparency, says Elvin. When developers offer DIBS plus a host of other incentives - rental guarantee, cash back payment, free furniture, free stamp duty and legal fees - banks and lending institutions provide mortgage loans based on the larger headline figure inclusive of these discounts. A mortgage based on the real price, without discounts, would reduce the loan amount and lessen household debt. Discounts tend to bloat up the loan amount by another 10% and 20%, says Elvin. The provision of the real price, without the discounts, gives a true and real picture of the housing market. DIBS and discounts have also resulted in a buoyant primary market. In 2009, the National Property Information Centre recorded a total of 211,600 residential transactions, of which 12.24% were purchases from developers and 87.76% from the secondary market. Three years later, in 2012, out of 272,669 transactions, slightly more than a fifth (22.09%) were purchases from developers. "This has never occurred before. This is an extraordinary jump, and this is because of DIBS and the discounts given," says Elvin. The shift in the market is clear and this represents risk, he says. On the issues of housing beyond the reach of many, about a third of housing in the country is below RM150,000. Some of them are in enviable locations, for example near Jalan Maarof in Bangsar Kuala Lumpur. But these are not well-maintained and young professionals do not want to live there. It boils down to an overall property management issue. PR1MA Corp Malaysia CEO Datuk Abdul Mutalib Alias says more than 20,000 homes will be built under 15 affordable housing projects in Greater Klang Valley, Johor, Penang, Sabah and Sarawak in Phase 1.

Huh? Do u know what u r actually saying? Do u know that salary hasnt moved much but property prices have moved so much that gen Y cant catch up? And the loan period, we only have 35 years, not 40 years now, mind you. Even with 35 years, u think that is good affordability? We have to pay until we are old, liao. Yeah our salary hit rm10k by 30 years old. So what? A rm7k earner also finds it hard to afford normal houses these days. Not like last time. There is this thing called inflation too. Look it up. Remember, it is the gen x that shaped this screwed up malaysia for gen y. Not to mention that gen x inherited most of the lands from previous generation freely and sell and used the money gao2. Gen y got nothing mah. Check la which generation that boasts about having so much of land. Gen x or gen y? Gen x was imho the right generation to make money because they came in just after merdeka and development was quite rapid. Now gen y peeps have to be more creative to get the same wealth. Gen x gets scholarship easily with stupid results. Gen y no way. Gen x easily gets a job with a degree. Gen y not easy to get a job with just a degree. Just because u r not gen y, dont think that situation is easier for us. I am speaking in general by not considering some exceptional cases.

This post has been edited by AMINT: Sep 9 2013, 08:43 AM

You forget another important stuff to compare to. Malaysia property can't be compared to HK or SG. Know why? We don't have massive quality skill foreign worker come over to work here and become PR. The price is drive by those who work oversea, speculator, investor that take advantage on cheap currency. One day, they will have their profit taking.

if they really having that good sale, they won't even bother to call you up.

Fun event coming soon.

+1 (all para except last para)

The highest contributor to our GDP is property sector. IF they cool it down, GDP might shrink which stakeholders might not want to see. Hence, i don't think gov will do much on this & if they do the effect/impact is unlikely to be significant/temp. Eventually, the % increase prop px will more than the % they try to curb.

Agree that some Gen-Y earns alot but spending like "waterfall" or like "big water supply" - spending habits

This post has been edited by Curious Guy: Sep 9 2013, 10:38 AM

Dont think the ban on DIBS will prevent developer from coming up with reimbursement plan for purchasers. I heard a few developers are cooking up this scheme. Whether or not they will fulfill the reimbursement is another question.

last time RM1 can buy 5 karipaps
Now RM2 only buy 5 karipaps
So RM10k now is RM5k for the prveious generation. Inflation inflation inflation.

And talking about previous generation screw us up, Who the hell agree with the existence of PROTON? Stupid morons! Should have known better. I was a small kid, so I dont know and cant say much. Previously I heard from people good branded cars were quite affordable by Malaysians after Merdeka. Then came PROTON and screw everything up for the new generations. Now good luck for us to buy good reliable cars that is worth the money. Good luck ever for the government to really do what they say and decrease the car price. They talk only, but they wont do it. Stupid previous generation.

Actually car prices did not go up for the past 10 to 15 years. It used to be very expensive compared to properties. Now, it is quite affordable RELATIVELY. Obviously, still expensive compared to other countries.

If you can't afford to buy then rent. Until you can afford to buy. That simple.

gen Y, Z.. , pls read this

http://www.starproperty.my/index.php/artic...-concrete-step/

car prices before the existence of Proton which is more than 20 yrs ago was much cheaper. That was what I am trying to say.

This was what I have been trying to say from the start when I entered Low Yat forum...I said dont buy a car at all. Buy property first and worry about how you will want to go anywhere later....and can always buy a motorcycle.

Dude, i am not talking about me. My case is exceptional. I started buying when i was 23 years old. We should talk about general gen y.

This post has been edited by AMINT: Sep 9 2013, 02:04 PM

Car is the basic necessity for any youngsters starting to work unless you can rent/buy properties near to LRT and your working place is near to train stations too. Even if you take LRT and rent a room, it can be quite dangerous also as many snatch thief cases happened while walking back to the rented place. In this aspect of ensuring safety and ease of access to public transport, the 50 plus years government had failed us. Kudos for them for building LRT extension and MRT, but it is 10 or 15 years behind schedule really.

Not safe riding a motorbike though. Guys can ride but how many working office ladies ride motor to work?

Same advise. Rent until you can afford to buy. Buying a property is not a necessity. One can always rent

Another option... parents send you to work so don't need car...



Can feel this forum getting very emo nowadays... my observation only la...

Actually, Asians are really peer pressured in buying properties. Most of the Chinese couple I know will buy a property b4 tying the knot. Only seen one or two couples renting - instant marriage cases. Yeah, with rental still affordable in Malaysia compared to buying, agree with you. Back 4 or 5 years ago when condominiums were really affordable, couples should just buy. But now, just buy according to your capacity.

Give a few examples:
Rent - RM1,400 - RM1,500
Instalment + maintenance if buying own unit: RM2,400. Don't forget all the yearly assessment fee.

Better put the extra of close to 1k in other types of investment I think.

why not renting? do you have the pros of renting?

Another option, move to SG and enjoy the good access to transport. Work SG buy KL.

Basic necessity is a home first than a car. Youngsters should get that priority straight. Always have an option of a bike. And everything is dangerous, not just snatch thieves. People can still rob you while you are in the car. Happens a lot lately.

Ok if you want to put ladies into the mix, I will say dont worry it is the husbands job to provide for you a homke. Then ladies buy a car if you want....but then use the LRT better. Anyway a lady fren of mine got robbed while she was in the car. A tip for ladies, if you are a lady driving a big car like a BMW, these robbers will like to target you. Easy prey with a lot of money they will think. True story. Well, just be vigilant.

Oh yeah remember the story of the people who got robbed in the parking lot in shopping complex? Everything is negative if you really want to look at the worst side of things. If you want to look at it that way, everything is bad, nothing is good. Might as well dont live. And dont eat at McDonals, lots of calories, gonna get a heart attack...stuff like that.

But if you're working in SG with better pay, living quality (much lower crime, lower tax, cleaner, efficient transport)... would you still want to return to KL? And if you do return to KL, at what stage of your life (retirement?) and If its retirement, would you want to buy near city (investment?) or outskirts (retirement?)... currency so low nowadays, boleh-land is becoming the place to retire... the high crime rate also guarantees your retirement will end here... lmao!!!

A lot of my friends in SG have already decided only to return when they retire... salary levels here are just pathetic... apologies and no offense intended towards those earning a living in boleh-land.

That is besides the point isnt it? That like saying if I employed a maid and the maid cooked lousy meal, then the maid said back to me," if u dont like the meal that i cook, u dont eat la. u go eat bread only". Also same like," you tak suka, you keluar malaysia la. sapa suruh u stay. nobody ask u to stay".

This post has been edited by AMINT: Sep 9 2013, 02:34 PM

Many pros
1) no debt
2) no lock in location. Can move out as and when you want
3) no risk of interest rates increase
4) more disposable income as rent <instalments
5) no risk of property bubble