KUALA LUMPUR: Sales of properties in Malaysia slightly declined in the first half of 2014 despite the high demand due to the cooling measures announced by the government in Budget 2014, says the Real Estate and Housing Developers’ Association (Rehda).Its president Datuk Seri Fateh Iskandar Mohamed Mansor said among the key measures affecting the sales were the 70 per cent loan-to-value ratio, the impending implementation of the Goods and Services Tax and the higher real property gains tax as well as responsible lending guidelines introduced by Bank Negara.
Speaking at a media briefing on the findings of the Rehda Property Industry Survey 1H2014 yesterday, he said close to 90 per cent of respondents experienced a slowdown, although the numbers of unsold units were manageable.
He said although the Malaysian economy is growing, the property sector is facing difficulty now, with unreleased Bumiputera lots cited as the major problem besides low demand or interest in certain areas and odd corner or special lots.
“We support the Bumiputera quotas but we are also hoping for an automatic release mechanism when developers have met the criterium of putting in enough effort to sell the properties to Bumiputera buyers,” he said.
Some municipal councils have increased the quota, increasing the cost of doing business, he said, adding the move is not practical as certain areas have lower demand from buyers of certain races.
Of the unsold properties, 34 per cent were priced between RM250,000 and RM500,000 and located in Perak and Pahang, with 31 per cent in the RM500,000 to RM1.0 million bracket in Selangor and Johor, he said.
Financing difficulty was cited as the main reason the units were unsold though they were in the affordable bracket, he said.
He urged banks to relook at the term ‘responsible lending’, saying the property sector makes up 40 per cent of loan disbursements and contributes substantially to the gross domestic product. — Bernama