below is latest "market" situation - from developers' perspective mostly.
u decide what they are really saying.
well, wat wud they say if it's actually hothothot bbbb like some are still saying?
M'sians holding back on the purchase of property
Posted on 05/01/2014 - 17:05
Joseph Wong
PETALING JAYA: Malaysians appear to be holding back on the purchase of property while owners are hesitating to sell, instead taking a wait-and-observe stance that is reminiscent of the period prior to the general election in May last year.
The cooling-down measures announced in Budget 2014 and those taken by Bank Negara Malaysia to end special schemes offered by developers like the developer interest-bearing scheme (DIBS) appear to have slowed down the market.
And, in the wake of the recent revision of real property gains tax (RPGT) under the Budget, there is a substantial leap in tax rates which will drastically affect sellers if they dispose of their property within five years from the purchase date.
As for new property – what developers noticed last month was that while buyers were willing to place a refundable booking fee of RM10,000 for a property, they were not too concerned about rushing their loan approvals to meet the DIBS deadline of Dec 31, 2013.
This move has struck developers as unusual because it was assumed that buyers would make the last-minute dash to secure the DIBS.
Bukit Kiara Properties Sdn Bhd co-founder and group MD Datuk NK Tong says home buyers appear to be holding back due to uncertainty in the property market.
This market sentiment, coupled with the government’s cooling measures, will stall sales for at least until Chinese New Year, he says.
“The buying mood is not there for the time being. There is a lot of uncertainty,” says Tong, adding that in every dark cloud, there is a silver lining.
“Buyers become more discerning in times of uncertainty and that is good for us,” he says.
And that is because of the many value-added features to Bukit Kiara Properties’ offerings like that of Verve Suites – which comprise four towers, namely Viva, Vibe, Vogue and Vox – that will make the developer’s property more appealing to others.
Buyers will make comparisons in uncertain times and Bukit Kiara Properties already has a good reputation with its many value-added features, he says, citing Verve Suites’ Sky Beach.
Tropicana Corp Bhd’s sales team has also noted the cautious trend. A source close to the property developer admits that buying interest is there but getting would-be buyers to commit to the purchase is another story.
During the launch of its latest property, the Paloma service residences and courtyard villas, which is phase two of the 37.2ha Tropicana Metropark, over a third of the property was booked by buyers.
“However, we do not consider it a sale until the sale and purchase (S&P) agreement has been signed,” says the source.
“It could be the coming holidays. With Christmas, New Year’s Day and school holidays, many buyers are away on vacation so it is hard to get them to commit to the sale at the moment,” he adds.
For sub-sales, a property agent says owners who are selling their property right now are those who have owned it for more than five years, so they are unaffected by the RPGT.
“Those whose properties are under five years are hesitant to sell right now for fear that they will lose a substantial amount of their investment,” he says.
From Jan 1, 2014, for property sold within three years of purchase, the RPGT is raised to 30%. Until Dec 31, property disposed of within the first two years are subject to 15% tax and those disposed of during the third year, a 10% tax.
For property sold during the fourth year, the rate has been increased to 20% and for those sold in the fifth year, 15%. Only disposals in the sixth year and beyond are RPGT-free. Companies will still be required to pay a RPGT of 5% even after the fifth year.
However, interest in owning a home is still strong despite buyers’ concern over rising prices.
The property agent believes that the slowdown in the property market is short term.
“Some buyers are waiting to see if price will drop or to see what will replace the DIBS, whether it is in terms of add-ons like free furnishings and appliances or other attractive measures,” he says.
Bukit Kiara Properties’ Tong says property prices will continue to rise despite the measures to curb speculation because demand still outstrips supply.
“The measures will slow down the property sector, which is not good when increasing the supply of property should be encouraged,” he says.
By slowing down the property market, the likely scenario is a sharp spike in prices once the market rebounds, he warns.
Property prices will always rise but it would be better if the rise is steady rather than the sharp spikes that Malaysia has been experiencing, he says.
The property agent predicts the possibility that owners may hike up the selling price of their property to offset the higher RPGT that they would have to pay.
If this happens, it will further push up property prices, he says, adding that the government measures are meant to stop speculation and slow the hike in prices but it appears that it may have the reverse effect.
“This will hurt the market and the buyers as they may be forced to bear the brunt of the increase in the RPGT,” he says.
http://www.theantdaily.com/news/2014/01/05...rchase-property
Jan 5 2014, 02:40 PM
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