HBA: Not hoping for prices to come down suddenly

The National House Buyers Association (HBA) said that whatever it has been proposing is for the government to stop property prices from going up too fast. It said that is is not hoping for prices to drop suddenly. This is because if it does, it will trigger a property bubble to burst which is a very bad situation. It’s secretary general, Chang Kim Loong said that the affordable homes schemes will only help more people to own homes but would not be pushing prices down. However, for some property speculators who do not have holding power, they may be forced to sell their property cheaper with the competition from these affordable properties. Majority of the buyers should not be affected.
HBA has proposed to the government to increase the stamp duty and real property gains tax (RPGT) for the purchase of the third and subsequent property. This is because most buyers are only able to afford two properties in their lifetime. One for own stay and another for long-term investment. I think the HBA is of the opinion that the third one is not encouraged as it may be more speculative in nature. There are some truths to this but I am not sure if this is a good move as it would really limit some people who are only concentrating on property as their investment vehicle for retirement. Not everyone may want to dabble in unit trusts or stocks too.
Chang also hoped that the affordable homes are only offer to first-time home buyers and should be in a good location and with reasonable prices of between RM150,000 and RM300,000 and not more than RM400,000 for prime locations. It should never be offered to second-time house buyers at all. Besides that, he opines private developers are the best agent for delivery and government can help fasten the ownership and delivery by offering rebates and incentives like lower conversion premiums, lower corporate tax rates and expedite the release of unsold bumiputra units.
I personally feel that private developers can help in really pushing for faster deliveries for these affordable homes compared to just government agencies. Let’ face the truth, if the developers are not doing this fast enough, they are only delaying the profits that they may earn. In fact I think many of the developers would love it if the units were fully sold immediately after launch so that they can quickly start building. Today, their main worries are more of not enough buyers. In fact where profits are concerned, I think many developers may be better off building these affordable homes instead of taking more risks by launching properties which are deemed ‘expensive’ under the current situation. Let’s see if the government listens to HBA’s recommendation for the third property onwards.
written on 25 Oct 2015
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  1. Hello HBA,
    If the cost of material had gone up 30% of course the property price will do so if not more. In certain places, the cost of developing had increase more than that, so what do you expect”? Don’t punish the wrong party, in this case 3rd home buyers. We can control the housing price, but everyone seems to be not interested.. For example, when the developer submit an application for housing to the Jab.Perumahan Negara and local municipal, they should analyze the housing prices first. If it is way too much, the developer should be summoned to give an explanation on what ground did they put such the high price. If nobody bothers, then it will be in the hands of any buyers/speculators to buy and the locals would be benchmarking the price for them to sell their property as well. In the end, the price would be climbing steeply higher because there are always buyers for whatever price. In that sense, we will see a steep price mark-up for every development year by year. Khazanah had already told the government to reduce the building materials but there seems some politicians that reluctantly to take action or think about it. They are smiling because their properties had appreciate in value and said bye-bye to anyone who missed the bus. Don’t be glad if your property had gone up too much because who knows it might be a bubble.

    1. Good point of view Im. I do not prefer steep increase. I m scared of bubble. I think buyers must also stop aiming at only that usual areas. This creates artificial demand which pushes up prices faster. Spread out. Think duration, not just distance. Think what you need, not what others may think of u…. cheers.

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