Sunday, September 29, 2013

Plight of kampung land owners


Where’s the prosecution against the 205 unlicensed housing developers?
ABOUT two years ago, an English daily highlighted the plight of land owners who had entered into joint ventures with unlicensed developers to build houses on their (home owners’) land.
Most of these deals involved land in the kampung (or villages). When these partnerships turned soured and were subsequently highlighted in the press, theHousing Ministry warned it was going to catch these businessmen, most of whom were small-time developers out to make a quick buck.
However, until today, no action seems to have been taken on these errant developers while the victims continue in their miseries and financial nightmares due to abandoned projects and botched joint ventures.
The Housing Ministry had warned that it was going to catch many businessmen, even small-time ones, as it was going to make it a requirement that all those who wished to develop a housing estate of only five houses should get a developer’s licence.
The Ministry seems rather proud of its wide-ranging powers and had a swooping determination (to weed out these unlicensed developers). It is really unfortunate nothing seems to have come out of that incident.
Swarms of entrepreneurs of the kampung variety, and some city slickers too, had invaded the countryside, and signed on owners of kampung land on the promise of turning them (the land owners) into developers. The wish was to turn idle kampung land into properly-built houses to sell to kampung people, usually by having joint ventures with the land owners.
“Give me your land to develop and I will give you X number of houses, and I shall take Y number of houses for my troubles; no cost to you, no hassles with government servants, no bank loans; no worries at all.” The current deal is 30:70; 30 % for the land proprietor and 70% for the housing developer.
Tricks of the trade
Kampung people as usual were wary; they were not going to buy till the project had got under way, and the proof to them was to give at least a house to the land owner and an enormous upfront deposit as the most convincing evidence of the developer’s sincerity. Perhaps, an upfront RM500,000 would be an ideal bait.
Firstly, said the developer, he needed the money to start building the land owners’ houses so it was not difficult to persuade them to charge their lands for the purpose. The other houses will have to wait including mine, said the developer most sweetly: no risk there you see, the land is still yours.
The developer then left for the city to apply for his licence which required the payment of a deposit to the Housing Ministry, and, of course, there were other payments to be made to various parties in the Government and arrangements had to be made with a construction company; all of which helped to collect the loan money from the land-owner-chargor.
However, the developer has not been heard from for some time now. The land owner/ would-be kampung entrepreneur/chargor went to the Housing Ministry to complain and demanded action to be taken and he was confident this will be done. You see, he knows the wakil rakyat.
Alas, said the legal officer to the kampong man: “So sorry, you had dealt with a person who has no license to be a developer. Under the law, we have no powers to prosecute an unlicensed developer who has abandoned the project.”
“Take action against him (the housing developer) for not having a licence; he has done all that a developer does including (entering into) contracts with intending purchasers and collecting deposits from them. There are at least 10 of them,” said the kampung man.
It is said, “the law is an ass” or that seems how we have made it out to be.
What the Housing Ministry’s legal officer could not bring himself to say is that the legal officers had tied their own hands by adopting a strange, restrictive reading of the law that to qualify as a housing developer, he should have undertaken to build and actually sell, at least, five houses, and to the legal officers it meant producing at least that number of house buyers to testify that they had indeed bought houses from a bogus housing developer!
The sale and purchase agreements and other documentary evidence and the evidence even of the developer’s own staff do not constitute evidence; the developer must plead guilty or there must be at least five buyers coming forward to give evidence; till then there is going to be no legal action against the bogus housing developer.
A request made by the Housing Ministry to the Bar Council for its advice on the professional liability of solicitors who act for unlicensed developers, sent more than a year ago, is still under consideration. At the latest count, there were at least 115 law firms, according to the records of the Housing Ministry, who did not seem to care to find out if their developer-clients were licensed or not.
The irony is it does not seem to matter whether the developer is licensed or not; they all abandon their projects with impunity.
Sadly, most of the lands in the rural areas are Malay Reserve Land which come under greater protection from the state but the banks are now gearing up to foreclose the only wealth the would-be kampung entrepreneur ever had, and had intended to bequeath to his children the way he had inherited it, coming from nenek moyang days.
Cry of the naive victims
Now, where do we go from here when the very people who initiated the housing laws shun their responsibilities? Shouldn’t buyers from unlicensed housing developers have the same protection as those buying from licensed ones? Where are the rescue plans for the naive victims of these Malay Reserve Land? Mind you, there are mostly current and retired civil servants.
Note: It has been two years since the list of the unlicensed housing developers has been unearthed.
Chang Kim Loong is the honorary secretary-general of the National House Buyers Association (www.hba.org.my), a non-profit, non-governmental organisation (NGO) manned by volunteers. He is also a NGO Councillor at the Subang Jaya Municipality Council. - The Star

Hunza plans to start RM7bil project in Bayan Baru in 2015


AFTER its Gurney Paragon project, Hunza Properties Bhd plans to focus on the development of commercial projects on the island and in Seberang Prai.
The group plans to start a RM7bil commercial city project in 2015 in Bayan Baru in the south-west district, a RM700mil commercial-cum-residential development in Juru, and a hotel in Tanjung Tokong.
Group executive chairman Datuk Khor Teng Tong tells StarBizWeek that the commercial city project, to be located on 16.1ha in Bayan Baru, would take 10 years to complete.
“There will be at least two four-to-five-star hotels, a shopping mall, college, high-end condominiums and office towers.
“We have engaged Australian and Singaporean architects to provide consultation on the design and concept of the project,” Khor says.
The shopping mall would be twice the size of the present Gurney Paragon shopping mall.
The project site is four times the size of the Gurney Paragon land.
“We are now building 690 units of flats to relocate the squatters on the site,” he adds.
While the group had expected the Gurney Paragon project to place Hunza in Penang’s development spotlight, the Bayan Baru project would propel Hunza to the national level, according to Khor.
The group expects demand for high-end schemes in Penang to rise, as the infrastructure on the island is improving with the completion of the second bridge, slated by October.
“There is also the RM8bil infrastructure package which includes the 6.5km undersea tunnel project linking Gurney Drive and Bagan Ajam, the 4.2km Gurney Drive-Lebuhraya Tun Dr Lim Chong Eu bypass, the 4.6km Lebuhraya Tun Dr Lim Chong Eu-Bandar Baru Air Itam bypass and a 12km road connecting Tanjung Bungah and Teluk Bahang, which are being planned to take the infrastructure in Penang to the next level,” Khor says.
The group is also planning a high-end hotel project in Tanjung Tokong, according to Khor.
In Juru, the group plans to develop a RM700mil commercial-cum-residential scheme which will include a RM60mil to RM70mil four-star hotel on 14.9ha.
“This will be the group’s first hotel, which will have 250 to 300 rooms. The scheme also includes a hypermarket, leisure facilities, and commercial and residential properties,” he says.
Khor says the planning proposal for the scheme would be submitted to the local authorities soon.
“We hope to commence work by the third quarter of 2014. The whole project will take three to five years to complete.
“The hotel will be managed by professionals and will provide steady revenue stream for the group besides the Gurney Paragon Mall,” Khor adds.
On the group’s residential schemes, Khor says it will launch the RM500mil Alila 2 project on 4ha in Tanjung Bungah next year.
“There will be 270 condominium units. We will apply for the green building index and construction quality assessment system certifications for the project.”
In Seberang Prai, the group has launched in the third quarter some 173 two-storey terraced houses in Bandar Putra Bertam, Kepala Batas.
“The project has to date achieved sales of more than 50%,” he adds. - The Star

1MDB embarks on Penang affordable housing project


WHILE Penang’s soaring property prices have become a conversational topic, the federal and state governments have pledged to make affordable housing available on the island.
On Tuesday, 1Malaysia Development Bhd (1MDB), a government-owned development company, bought 9.5ha from Farlim Group (M) Bhd for RM112.5mil through one of its subsidiaries. The deal marks 1MDB’s first public land deal in Penang, and when contacted by StarBizWeek, the company says it is part of 1MDB’s plan to develop affordable housing in Penang as announced earlier.
During a visit to Penang in May, Prime Minister Datuk Seri Najib Tun Razakannounced that the federal government will build 2,222 low-medium cost houses and 1,111 affordable houses in Air Putih, Air Itam and Paya Terubong. It was a pre-election political pledge to the people of Penang by the federal government.
A property developer reckoned that the affordable housing scheme could cost about RM300,000 per unit, depending on the development.
“If assuming the plot ratio is four, then it will work out to RM50 per sq ft of gross floor area. Construction cost circa 200 per sq ft, and that would work out to a total development cost of RM250 per sq ft.
Therefore cost of a three bedroom 1,200 sq ft unit would be around RM300,000. This is just the cost price,” he says.
He, however, said development cost could come down to RM150 per sqft if its based on a lower cost structure.
If we scrutinise the deal more, the said land is strategically situated within an established township known as Bandar Air Itam (formerly known as Ayer Itam) and is sited at the north-eastern part of the island.
“This township is located along Jalan Air Itam and Jalan Paya Terubong, the main thoroughfares leading to the Kek Lok Si temple as well as the Penang Hill funicular railway station,” says Farlim in a filing on Tuesday.
But the main caveat for 1MDB is that the land is presently occupied by squatters and structures comprising residential units (semi-concrete, concrete, wooden and zinc houses), foundries, temples, a recycle centre, factories, workshops and shops.
Simply, that would mean more time and capital exhausted to relocate these squatters to other suitable areas.
The company might have to allocate a number of units as settlement, narrowing down the supply of units for eligible owners.
From past experience, dealing with squatters is a sensitive issue as people have a natural resistance to change and eviction notices aren’t welcome.
“This might just be the beginning of high density flats ala the Singapore Housing Development Board (HDB) flats style,” says a market observer.
Speculation is also that 1MDB could be snapping up remaining portion of the land from the other owners, as Farlim have just a fraction of ownership rights to the said three parcels of land.
Farlim did not respond to queries by StarBizWeek over the identity of the other owners of the said land.
The Penang state government has earmarked seven projects in August for affordable housing where 4,145 low-medium-cost, 3,148 medium-cost homes and six shoplots would be built.
Meanwhile, the federal government has also proposed to redevelop the Rifle Range flats, Penang’s first affordable housing project. However, this is still pending approval by local authorities.
When the Rifle Range flats were completed in the early 1970s, they were the tallest buildings in Penang.
The units in the nine blocks of 16-storey dwellings were only about 400 sq ft and provide housing for some 25,000 people.
Besides its property venture, 1MDB has also gone extensively into the energy sector, buying up power plants to beef up its cash flow.
It currently holds 100% of Powertek Energy Sdn Bhd and 75% in Jimah Energy Ventures Holdings Sdn Bhd and Kuala Langat Power Plant Sdn Bhd (KLPP), respectively, involving an investment totalling RM12bil.
1MDB had acquired Powertek and KLPP in a portfolio of power plants with a total generating capacity of 4,600 MW in Malaysia, Bangladesh, Pakistan, Egypt, Sri Lanka and Abu Dhabi.
1MDB is also known to be actively bidding for a 2,000MW coal-fired power plant, dubbed Project 3B, as well as other greenfield and brownfield developments in the region.
It is taking the lead in the development of government land in prime areas of Kuala Lumpur. Some 70 acres in Jalan Tun Razak, the project of which is likely to be delayed, will be shaped into a financial district called the Tun Razak Exchange, while the old airport in Sungai Besi, renamed Bandar Malaysia, is being converted into a mixed development. - The Star

Tuesday, September 24, 2013

谢诗坚:客家村将设各族文物馆 浮罗山背拟建土楼酒店


(槟城23日讯)马来西亚客联会署理总会长拿督谢诗坚博士宣布,浮罗山背客家村联委会将在浮罗山背设立一座具有现代化和符合酒店业需求的具有土楼特 色的酒店供游客住宿,以享受浮罗山背与众不同的自然美景和清新空气。这座圆形的土楼酒店,内部有浮罗山背各民族文物馆,用三语呈现,也有艺术走廊,供画家 展销精心杰作。
谢诗坚也是浮罗山背客家村联委会总策划,他说一个新的旅游景点,一个命名为“浮罗山背客家村”的宏伟计划,即将在浮罗山背离开双溪槟榔不远的大路旁的一块20依格的土地上建立起来。
首个海外客家村
“感谢热心客家文化的企业家,在知悉我们有一个客家梦后,便在年初与我们接头,希望我们能一起合作,把浮罗山背打造出第一个马来西亚客家村,也是世界上第一个海外客家村,以共同推动旅游业。”
“参考土楼结构只是因为土楼一望即知客家,无需再作解释,并不具其他用心。其中我们也将与台湾大学的客家学院合作,设立客家文化基地,为学者及学界提供文库资料。同时我们也会设立一间客家餐馆;也会设立槟城美食的小贩中心、土产销售中心、旅游产品及精品店等。”
“更为出色的是,我们保留了榴梿园、也会建立豆蔻、丁香和橡胶品种供参观者了解浮罗的特产。我们要让来自世界各地的人真正享受浮罗山背的自然生态和具有价值的文化生态。”
谢诗坚是在槟州客家公会周日举行74周年(客家情,浮罗梦),青年团33周年,妇女组15周年及浮罗山背客家村联委会5周年联欢宴上致词时这么表示。- 

Sunday, September 22, 2013

产业投机有过热迹象 业界建议加强管制


(吉隆坡21日讯)最近,有关谈论房地产收益税(RPGT)可能会恢复在下月出炉的2014年财政预算案中讨论。房地产和住房开发商协会(REHDA)已书面向有关部门陈述它们的观点。国家银行也研究禁止发展商在建筑期间负担买家利息的可行性方案。
发展商的利息负担计划(DIBS)就是鼓励投机行动,因为购房者只需要支付5%或10%的首期,然后无须负担任何费用,直到该物业落成为止。
重新推出RPGT以及可能取消DIBS,显示房地产领域准备面对未来挑战的迹象,就好像东南亚股票市场出现动荡一样。
然而马来西亚在较大的经济框架中,必须解决一系列问题,例如有3个问题一直困扰着房地产领域,分别是泡沫、投机因素和负担能力。
发展商希望能够有一个温和的RPGT制度,而DIBS则维持不变,而有某部分希望返回旧的税制,即是在首年内出售产业就要缴交30%的产业盈利税。
购房者协会(HBA)兼Khong & Jaafar地产代理公司产业顾问埃尔文费尔南德斯说,RPGT是一项既反投机又能增加税收的措施。在过去两个预算案中,HBA所预期的税制改革令它大失所望。
曾经有一段时间,并不是所有发展商提供免收利息计划。今天,大多数都是受到这样压力下而做。REHDA主席拿督斯里任志刚称:“这个计划可以帮助购房者买入房屋。”
埃尔文指出:“不过,这也产生投机的趋势。”
顺便一提,新加坡政府是第一个国家实施取消免收利息计划,早在2009年因为当地的房地产投机活动过热,因此政府推行上述计划来冷却市场。
埃尔文表示,除了DIBS之外,最大的问题是透明度。当发展商提供DIBS加上其他奖励:例如租赁担保、现金付款回扣、附送家具,免收费印花税及法律费用,而银行和贷款机构提供抵押贷款是基于大型发展商的信誉以及这些折扣而订。
提供一个没有折扣的实际价格,正好反映房产市场真实的一面。
DIBS和折扣也会导致初级市场蓬勃发展。在2009年,全国房产资讯中心共录得21万1600宗楼宇成交个案,当中12.24%是从发展商购买,而87.76%则从二手市场购买。
此外,3年后的2012年,成交个案增至27万2669宗,当中从发展商购买的比率高达22.09%。
埃尔文透露:“这种情况从来没有出现过。这是一个不寻常的跳升,主要是发展商给予DIBS和折扣的关系。”
他说,市场的转变是明确的,而这也代表了风险。
住房问题非常复杂,因此无法达到许多人的要求,而国内大约有三分之一的房屋,其价格是15万令吉以下。其中一些房屋坐落在令人羡慕的地区,例如吉隆坡的孟沙。
但是这些房屋都没有得到适当的维修,而且年轻专业人士不希望在那里生活。它可以归结为一个整体的产业管理问题。
大马PR1MA机构首席执行员拿督阿都慕达立阿利亚斯说,超过2万家房屋将在大巴生谷、柔佛、槟城、沙巴和砂拉越的第1阶段15个可负担住房项目下建成。- 

Thursday, September 19, 2013

Rehda sees rise in real property gains tax


KUALA LUMPUR: Real Estate and Housing Developers’ Association Malaysia (Rehda) expects the Government to increase real property gains tax (RPGT) by 15%-20% in the 2014 Budget to be tabled on Oct 25.
Its chairman of finance and investment committee, Datuk Ng Seing Liong, said buyers should not worry about the increase in RGPT as it would only affect buyers who disposed of their properties within five years after their purchase.
“At least when buyers buy property, they must hold it for five years before they let it go,” he told a media briefing.
According to news reports, the Government was considering an increase in RPGT to curb excessive speculation which has led to the increase in the prices of houses. — Bernama

Thursday, September 12, 2013

RM1.5bil affordable housing project


PETALING JAYA: Construction company Pesona Metro Holdings Bhd is a frontrunner for a massive RM1.5bil housing project under the Government’s1Malaysia People’s Housing Scheme or better known as PR1MA.
Sources said the company, which was listed via a reverse takeover last October, is likely to be chosen due to its “expertise” and “track record”.
There were four other bids that were submitted for the job, which should take some 30 months to complete once it is awarded, a source noted.
An announcement on this will be made earliest in two weeks’ time.
Since its debut on Bursa Malaysia, Pesona has been relatively quiet until recently, that is.
In June, it announced that it had obtained an RM87mil job for the proposed construction and completion of the remaining and rectification works of a government office building.
Pesona had declared last October that it was bidding for construction projects under the PR1MA programme.
If this RM1.5bil job does go to Pesona, then it would more than triple its current orderbook of about RM570mil, making it a major construction concern.
Shares in Pesona ended 6% higher to 50.5 sen on a volume of 20.7 million shares at yesterday’s close.
It was announced last month that more than 20,000 homes would be built under 15 affordable housing projects in Greater Klang Valley, Johor, Penang, Sabah and Sarawak.
These 15 projects come under Phase 1 of the PR1MA programme, an affordable housing scheme announced under Budget 2013.
PR1MA Corp Malaysia chief executive officer Datuk Abdul Mutalib Alias had said last month that specifications of the houses, including pricing and floor plans, would be announced in the next few months.
However, it has been reported that the homes would be priced under RM350,000 per unit.
Recall, Pesona took over the listing status of financially-beleaguered Mithril Bhdlast year amid a restructuring exercise.
It had raised more than RM10mil for working capital via the issuance of 40 million new shares of 25 sen each then.
While Pesona may not immediately be a recognisable name, it has completed more than 30 projects valued at more than RM1.5bil.
Among its completed projects are a flood mitigation project in Sungai Kerayong, Kuala Lumpur, the construction of the Timah Tasoh Dam in Perlis and the Zehn Luxury Condominium at Jalan Bukit Pantai, Kuala Lumpur.
The company is also responsible for the construction of the Customs, Immigration and Quarantine Complex in Melaka, which it completed and handed over in the last financial year ended Dec 31, 2012 (FY12).
Citing internal projections, sources said the PR1MA project is expected to yield Pesona some RM202.5mil in net profit based on a projected 13% profit margin.
This is huge in comparison to its current earnings. For its six months ended June 30, Pesona’s net profit stood at RM8.39mil on a revenue of RM154.32mil.
For FY12, its net profit was at RM11.78mil on a revenue of RM220.78mil.
The group’s current net assets per share stands at 14.50 sen per share. It has cash and bank balances of RM25.5mil with minimal borrowings. - The Star

Tuesday, September 10, 2013

UK House Prices Rise Further, Sales Jump


British house prices recorded their fastest rise in almost seven years last month and a measure of sales volumes also jumped to a multi-year high, a survey showed on Tuesday.
The Royal Institution of Chartered Surveyors' seasonally adjusted house price balance climbed to +40 from a slightly upwardly revised +37 in July, staying at its highest since November 2006.
The balance reflects the percentage of property professionals saying that prices rose minus those reporting falls.
Britain's housing market has shown signs of a revival this year, spurred by a healing economy and help from the government and the Bank of England to ease access to finance. But the scale of the recovery has raised concerns about a new property bubble.
The RICS survey found that a net balance of +45 of surveyors expect further price growth over the next three months. Over the coming year, house prices are forecast to rise by 2.2 percent.
"Momentum is increasingly broad-based across the country; this isn't just a London story," RICS said.
The average number of sold properties per surveyor rose to 17.9 over the last three months, the highest since January 2010.
The number of properties going on sale also increased markedly in August, with the relevant balance jumping to +26 from 16 in July.
"With positivity starting to return to areas right across the UK, it seems those who may have been waiting for the right time to sell are choosing now to do so," RICS said.- Reuters

Thursday, September 5, 2013

House buyers to shoulder burden of impact of fuel price hike, crackdown on illegals, say developers


Prospective house buyers face forking out at least 10% more for their dream home, with developers bound to push additional costs caused by an increase in fuel prices and worker absenteeism.
The Star reported that the construction industry had been hit by a double blow, higher costs of building materials due to the RM0.20 increase in the price of RON 95 petrol and a nationwide crackdown on illegal immigrants by authorities.
The Star quoted Real Estate and Housing Developers Association of Malaysia president Datuk Seri Michael Yam Kong Choy as saying the failure of foreign workers to turn up for work was causing delays, which added to costs.
He said developers had experienced this in the past when continuous raids by authorities resulted in legal migrant workers not turning up for work or delaying their return to Malaysia.
Yam said migrant workers, even those with proper documents, were intimidated by these raids.
"The shrinking supply of labour will force developers to pay workers more to meet contractual deadlines. Failure to meet these deadlines will result in financial penalties as developers are bound by the sales and purchase agreements signed," Yam added.
The Star reported that sales and purchase agreements stipulated that compensation will have to be paid by the developer to buyers if delivery of the said property is late. Contracts in the private sector also have no provisions for price adjustments.
Despite the call by Prime Minister Datuk Seri Najib Razak last week for businesses and traders not to increase their prices following the increase in petrol prices, Yam said it had affected the entire supply chain of the industry, involving more than 100 types of businesses.
Master Builders Association of Malaysia president Matthew Tee warned of a scenario similar to 2002, when the construction industry grounded to a standstill due to a shortage of workers.
He said their members were already complaining that their legal workers whose documents were being processed hadn't turned up for work.
"Our understanding is that all foreign workers will be detained unless they can prove that they have proper documentation. This can be difficult as their documents may still be with their employer or immigration pending the affixing visa of stickers by the authorities," Tee said.
In Penang, the Penang Master Builders and Building Materials Dealers Association says it expected construction costs to rise by 3 to 5%. The cost of transportation was likely to rise 10 to 20% and the prices of sand and cement by between 5 and 10%. - The Malaysian Insider

Wednesday, September 4, 2013

... But it is beyond our means, say youngsters


KUALA LUMPUR: Malaysian youths, who have been encouraged by the Real Estate and Housing Developers Association to buy a house before a car, say houses are too expensive and beyond their means.
Marketing executive Omar Islam Akhiruddin, 26, bought a second-hand car last year and lives with his parents in Puchong.
“I need a car because I need to move around and houses are expensive,” said Omar, adding that since he lived with his parents, a house was not a necessity yet.
Omar said he would prioritise buying a house if there was an LRT station nearby, adding that he would not depend on buses as a form of public transportation.
SEGi University lecturer Alex Chan, 28, says that even with the 1Malaysia Housing Programme (PR1MA), houses were too expensive for fresh graduates.
“As the Government has raised the ceiling price for PR1MA houses, they are too costly for fresh graduates who have loans to pay and other living expenses to meet,” he said.
Earlier this year, the Government raised the ceiling price of PR1MA homes to RM450,000 while the maximum household income eligibility was increased to RM7,500.
Chan, who bought a car earlier this year, said a vehicle ranked higher in necessity than a house in Malaysia.
“I can always rent a place but my house can’t take me places. People need transport,” said the Ipoh native, who has been renting rooms since he started working in 2010.
According to Chan, the public transportation system here was unreliable.
“KTM is not that good. The LRT is okay but it doesn’t go everywhere.
“When we have an efficient transportation system, which is also affordable and easily accessible, people can perhaps prioritise where their financial responsibilities lie,” he said.
Broadcasting student Joshua Nicholas Aeria, 24, said he was looking forward to moving out from his relatives’ house and buying a car once he finds a job.
“I want to rent a place and slowly save up for a car but finding a job is the top priority at the moment and having a car helps,” said Joshua. - The Star

Buy house first, youths told


PETALING JAYA: These days, it has become a trend among the young who enter working life to place priority on owning a car instead of a home.
Perhaps buying a vehicle which gels with their current lifestyle is cheaper for them, compared to purchasing a house.
Nevertheless, Real Estate and Housing Developers’ Association’s (Rehda) immediate past president Datuk Ng Seing Liong said the trend should be reversed.
“Buying a property, such as an affordable house, should be the main priority for youngsters and they should not wear out their salary on owning a car,” he told Bernama when met at Wisma Rehda here yesterday.
Thus, he suggested that youngsters begin buying property early in their careers, especially for those located in hotspot areas.
“I understand that a car is a necessity for the younger generation, but bear in mind that property prices will always go up. Take this as an investment and in the meantime commute via public transportation,” advised Ng.
He said there were affordable houses away from the city centre which were in high demand.
“Higher prices are only in the hot-spot areas, but it seems to reflect the whole market.
“If they look at the bigger areas, such as in Malacca, Pahang and Kelantan, the prices are still affordable.”
He also explained that the property value rise could be attributed to “people are not just buying a house, but they are purchasing the lifestyle that comes with the property”.
According to Rehda’s Property Industry Survey for the first half of this year, the top five hotspots in the Klang Valley are Puchong, Cheras, Kota Damansara, Kuala Lumpur City Centre and Shah Alam, with landed property ranking at the top followed by condominiums and serviced apartments. - The Star

Rehda wants monitoring of buyers of affordable homes


KUALA LUMPUR: The Real Estate and Housing Developers’ Association (Rehda) has called on the government to monitor buyers of affordable housing, saying there is no mechanism for this at present.

Rehda president Datuk Sri Michael Yam said while developers have done their best to provide houses in an affordable price range, it is also the government’s duty to monitor house buyers to make sure that affordable houses are going to the right people.

“I think as a responsible organisation, our developers have provided a million low- to medium-cost houses. But there has been no monitoring of the sub-sales of subsidised housing, and something has to be done in order to prevent profiteering.

“Under the context of the social housing system, developers are being responsible. But who monitors who gets the houses later? Going forward, if the government wants to reach the target audience for affordable housing, there has to be a body to control  subsequent transfers,” he told a media briefing yesterday.

Rehda immediate past president, Datuk Ng Seing Liong, said there has been a misconception among buyers in general with regard to rising house prices.

“There have only been a few hotspots where property prices have gone up. However, it must be understood that people are not buying homes, but rather a lifestyle. There are many second-hand houses that have not seen much of a take-up rate due to financing issues,” said Ng.

According to recent Rehda research findings, residential selling prices averaged between RM500,000 and RM1 million during the first half of the year, mostly in Selangor, Kuala Lumpur, Johor and Penang.

The survey, which sampled 150 Rehda association members across 12 states, found that the number of respondents that will be offering houses priced within the RM250,000 to RM500,000 range is expected to increase to 25% of total units in the second half of 2013 after falling to 23% in the first half.
Yam: ... something has to be done to prevent profiteering.
The survey also showed that some 95% of buyers were local, whose main purpose was for their own occupation. The remaining 5% were foreign buyers who purchased the units  for investment purposes.
The survey respondents were optimistic of the outlook for the second half of 2013, with the sentiment expected to continue into the first half of 2014.

Future launches are expected to increase to 63% or 18,181 units year-on-year for the second half of 2013, with strata properties expected to dominate launches in KL, Selangor and Johor.

The survey also found that the local property market is facing its fair share of challenges, which could change sentiment.

Yam said rising labour costs and shortages, inconsistent supply and the increasing cost of building materials were the main challenges plaguing the construction side of the industry.

Almost half the respondents have reported a 5% to 10% increase in the cost of doing business.

“There was also a significant increase in the buyers (about 62%) reporting to our members that they were having issues with end-financing, as a result of the stricter borrowing requirements imposed by the banks,” Yam said.


This article first appeared in The Edge Financial Daily, on September 03, 2013.

Tuesday, September 3, 2013

Looking after the affordable housing community


PETALING JAYA: Measures to curb speculation in the property market and cross-subsidisation do not make for a healthy property sector in the medium to long term, according to the Real Estate and Housing Developers’ Association of Malaysia (Rehda).
Rehda president Datuk Seri Michael Yam drew attention to the affordable housing segment, which suffers the brunt of such measures like the real property gains tax (RPGT) as well as the impact of cross-subsidisation from the low-cost segment.
“Property speculation is in hotspots, not among the affordable housing community, but if the Government continues to have tightening measures, then it could affect 95% of the market,” he said at Rehda’s 2013 first-half property industry survey, noting that the secondary property market, for example, would not be able to sell well.
“We need to examine carefully the various categories of buyers and speculators and prescribe a more focused action plan against the right people,” he said, explaining that the broad brush-stroke approach of dealing with speculators had unjustly impacted other asset classes as well.
Past president Datuk Ng Seing Liong added that the hoo-hah about property price hikes was not reflective of the whole market, as steep rising prices occurred only in certain hotspots.
“Price hikes in these hotspots were reflected in the media and then caught by house buyer associations, which started asking the Government to clamp down on property speculation via the RPGT and other tightening measures,” he said, “Remember, these people are buying into a lifestyle, and hence, the price has to go up.” Ng noted that there were reasonably priced basic houses out there and that there was supply in the secondary property market. “The choice is still with the buyer, they should not just claim that prices keep going up.”
He also commented on the build-then-sell (BTS) mechanism, which he believes will negatively affect house buyers in the end, as supply falls subsequently.
“With BTS, when we start restricting supply, house prices would go up.”
Aside from the curbing measures, Yam also pointed out a need to revise the cross-subsidisation, which has also led to swelling property prices across the board.
“The low-cost subsidised housing is sold for RM42,000 when the building cost is RM100,000. So, who is paying the difference? The subsidy is passed through to other housing categories and subsequently, those who buy in these other categories,” Yam said, adding, “Thus, prices have gone up.”
To address this issue, he recommended that the Government focus on affordable housing, which could be built without a loss so that developers need not pass the cost to other buyers. “Now that low-cost housing is no longer required, the Government should focus on affordable housing, be it through the 1MalaysiaHousing Programme, or PR1MA, or even developers,” he said. - The Star

More property launches expected in H2


PETALING JAYA: The number of property launches expected in the second half of 2013 will be higher compared with the first half, trending towards smaller and affordable units according to Real Estate and Housing Developers’ Association of Malaysia’s (Rehda) property industry survey.
The survey showed that 63% of respondents have product launches in the coming months with 18,181 units in the pipeline, which is 11% higher than the first half of this year.
Rehda’s findings also found that smaller and affordable units are expected to be the trend of the future as landed property launches drop from 53% in the first half to 38%.
“There are more strata property in upcoming launches in the second half of 2013, with 15% increase in numbers compared with the first half, coming from Kuala Lumpur, Selangor, Penang and Johor,” Rehda president Datuk Seri Michael Yamsaid.
“This is because as property prices go up, developers have to shrink the unit sizes so that the absolute value is within the reach of first-time homeowners and young professionals,” he said. While two and three-storey terrace houses were the most popular property types launched in the first half, condominiums and apartments will take the lead in the coming period.
In the commercial segment, 48% of upcoming launches will be SoHo (small office home office), SoFo (small office flexible office) or SoVo (small office versatile office) units. - The Star

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Sunday, September 1, 2013

‘Minimum RM1m property purchase not a blanket policy’


KUALA LUMPUR: Raising the minimum purchase price for foreign property buyers to RM1 million is not a blanket policy, said Minister of Urban Wellbeing, Housing and Local Government Datuk Abdul Rahman Dahlan.

Speaking at a press conference yesterday, Rahman stressed that the ministry would not implement it as a blanket policy throughout the country, “because it’s not going to be fair to developers.”

He said the government would advise developers or state governments to increase the minimum purchase price for foreign buyers to RM1 million if there is a chronic problem with affordability issues in the particular areas.

“There are areas where the RM500,000 minimum purchase price for foreigners does not have a direct impact on the issue of affordability in the local market,” he said after giving a keynote address at the 16th Malaysia Housing and Property Summit 2013 organised by the Asian Strategy & Leadership Institute (ASLI).

Overall, only 5.5% of property throughout the country are owned by foreigners, he said.

“I don’t think we should deprive developers of the potential business they can get from foreign buyers,” he added.

Meanwhile, he said the ministry may consider raising real property gains tax (RPGT) to stabilise the price of houses in the country.

Nevertheless, its effectiveness as a measure to curb housing speculation has been questionable, he said.

He noted that the current low RPGT has not been effective in stabilising house prices, although it has been raised from 5% to 10% in 2011 for properties sold within two years. In 2012, this rate was further increased to 15%.

The house price index by the National Property Information Centre (Napic) recorded the highest increase for the last five years, showing the ineffectiveness of the current RGPT mechanism.

On the progress of the one million affordable housing units by the government, Rahman said the ministry has established a coordination committee to monitor its implementation by 1Malaysia People’s Housing Program (PR1MA), Syarikat Perumahan Negara Bhd (SPNB) and other agencies.
What’s in store... Asli chairman and Sunway Group chairman Tan Sri Dr Jeffrey Cheah (right), Minister of Urban Wellbeing, Housing and Local Government Datuk Abdul Rahman Dahlan (centre) and Asli CEO Tan Sri Dr Michael Yeoh at the 16th National Housing & Property Summit 2013 in Kuala Lumpur yesterday
“Under the first-time home buyer scheme, there is a huge demand but the supply is not there. PR1MA is our answer to that problem,” he added.

PR1MA is a programme dedicated to providing affordable quality housing for the middle-income group living in the country’s urban areas.
In his keynote address, Rahman said that the one million affordable housing units include 500,000 units under PR1MA Corp Malaysia, which will be 20% cheaper than similar units in the market.
“The proposed one million affordable housing units announced by the government would have an impact on market supply and would affect prices of affordable houses in the market,” he added.

He pointed out that the committee aimed to coordinate the efforts by all the government agencies and state governments to ensure that the target of one million housing can be achieved.

“It’s not so easy to pinpoint problems with regard to the runaway prices, it’s not fair just to simply point at property developers. There are many other reasons including some policies of the government that need to be looked at,” said Rahman.

“It cannot be resolved by one party alone, it has to be a collaboration involving everyone.”


This article first appeared in The Edge Financial Daily, on August 28, 2013.

‘Higher RPGT does not work’

KUALA LUMPUR: Imposing higher real property gains tax (RPGT) will not be effective in arresting rising property prices, say industry players.

Urban Wellbeing, Housing and Local Government Minister Datuk Abdul Rahman Dahlan said on Tuesday that his ministry is studying the imposition of a higher RPGT next year to stabilise housing prices.

Currently, an RPGT of 15% is imposed on properties sold within two years of ownership and 10% if sold within three to five years. Properties sold after five years are exempt.

“Politically, the government needs to be seen as doing something about property prices. The RPGT is a good hint to speculators that the government plans to cool the property market without affecting genuine homeowners,” said DTZ Malaysia director Eddy Wong.

“Singapore has so far imposed eight rounds of cooling measures. It can mean that the previous seven rounds did not quite achieve the intended effect and that’s why there is an eighth round. But this time, the Real Estate Development Association of Singapore is saying the Singapore property market is approaching ‘inflexion point’, so perhaps this time it will work?

“Two of the fundamental drivers of property prices are a growing young population who are setting up their own households and income growth. Some people may speculate but so long as these drivers are there, prices will go up,” he said. 

CH Williams Talhar & Wong Sdn Bhd managing director Foo Gee Jen proposed some changes to the existing RPGT structure and additional measures to curb rising prices.

“The government may want to consider raising the RPGT quantum and period, and impose a stamp duty on property sellers who have a lot of transactions in a certain timeframe,” he told The Edge Financial Daily.

“I am in favour of a further 5% increase in the RPGT and stretch the disposal period from two years to three years. For example, the RPGT on disposals made during the first three years is raised to 20%. 

“Most speculative transactions happen around the second and third year. The third year is when most properties are completed. So this longer period will cover a wider basket of speculators,” Foo explained.

On the imposition of stamp duty on sellers, he said: “For example, you can impose a 3% stamp duty on sellers who have sold more than four properties in the last five years.”

Foo urged the government to monitor other trends in the primary market. These are bulk purchases, group discounts, rebates and freebies such as waiving legal fees and offering partially furnished units, which are usually included into the price tag.

“I think there is a need to make sure property prices are sustainable and affordable. If prices are sustainable, in line with the income of the rakyat, there is no need to reduce prices,” Foo said.

Real Estate and Housing Developers’ Association national treasurer Datuk NK Tong said raising the RPGT may work in the short term but will backfire.

“To introduce cooling off measures, including raising RPGT, at a time like this will slow down the construction of houses. While this will stabilise prices in the short run, the shortage of supply will further drive up prices in the medium to long run,” he said.

Tong said cities in Australia — Melbourne, Adelaide, Sydney and Perth — are ranked among the top 10 most livable cities in the EIU Global Livability Survey 2012. Kuala Lumpur ranked 77 out of 140.

Australia has 22 million people living in 9.1 million homes in the city, while Malaysia has 20 million people living in only 4.8 million homes in urban areas.

“If we are to be a truly developed nation, Malaysia needs more houses.

“There will be a higher number of people per household, which could also be due to multi-generational homes rather than married couples moving out,” Tong said.

Assuming no further population growth, he estimated that Malaysia would need 8.3 million homes or a new supply of 100,000 homes per annum over 35 years for the 20 million urbanites in Malaysia for the country to be as livable as Australia.

“Everywhere in the world, the need for affordable housing has been one of the key responsibilities of the government. Malaysia tried to address this through many agencies in the past but the numbers are still way behind. Hopefully with the advent of PR1MA [1 Malaysia Housing Programme], it can finally catch up with the demand of the people.

“Governments are also challenged to find ways to increase the incomes of people in order to keep up with inflation. Artificial price controls are not sustainable in the long run. What should be done is to address the need for us to move ahead to be a high-income nation, and this is in line with Malaysia’s aspiration to be a truly developed nation,” said Tong.


This article first appeared in The Edge Financial Daily, on August 30, 2013.

文秀打造高品质房屋 Raffel Residence 18.18将获入伙准证


(槟城讯)由文秀产业集团在槟岛甘密山打造的“Raffel Residence 18.18”房屋计划,近日获新加坡建筑业评估机构,通过建筑质量评估体系(CONQUAS),在100分中的评分为85.2分,这个分数也是槟州有史以来,获最高分数的房屋计划。
这间来自新加坡的建筑机构(Building & Construction Authority),是国际权威的建筑评估机构,该机构主要检测建筑的质量及手工。
骆南辉:CONQUAS评分获高分 深表荣幸
文秀产业集团企业总监骆南辉受询时说,该集团是国内历史悠久的房屋发展商,拥有极其丰富的房屋发展经验,所推出每一项房屋计划,都会关注建筑的质量及手工。
他说,该集团如今其中一项的“Raffel Residence 18.18”房屋计划在CONQUAS评分系统中获得高分,这是对文秀产业集团的一种肯定,槟州不曾有过一项房屋计划获得如此高分,文秀产业集团就做得到。
他强调,新加坡建筑机构是受到国际认同的房屋评估机构,该机构的CONQUAS系统也在房屋发展业中具有权威性,能够在此系统下获得如此高分,文秀产业集团深表荣幸。
他也借此机会,感谢主要承包商钟建筑工程有限公司、工程与绘测师Arkitek Permata、一众顾问等合作伙伴。“文秀产业集团能够获得这项荣誉,也是因为有这些合作伙伴的配合,所以我非常感谢他们。” - 光华