/// West Malaysia Property News
Johor Government to Slap 2% Levy
on Foreign Property Buyers
Andaman Upbeat on Property Market
Andaman currently owns
land in Kota Damansara,
Ampang and Subang,
which will be developed
and launched over the
next few years as mixed
developments.
The property player
is targeting to achieve
above RM1 billion in
sales from all its projects
in 2014.
Andaman Property Management Sdn Bhd managing
director Datuk Seri Dr Vincent Tiew: “After buyers grasp
a better understanding of the central bank guidelines,
many will want to keep investing”
The Johor government has
plans to impose a 2% levy
on foreign buyers across
all property segments
including the secondary
property market from May
in addition to the recent
cooling measures announced
in the Budget 2014. The rate
is lower than the 4% to 5%
mooted earlier. The current
flat rate is RM10,000 for all
types of properties.
Knight Frank Research, in
its report titled Real Estate
Highlight Second half 2013
noted that the recent cooling
measures announced in
the Budget 2014 to curb
speculation in the local
property market may have a
slight impact on demand for
the Johor property market.
However, foreigners
particularly Singaporeans, will
continue to buy properties
within the state as most of the
existing high-end properties
available in the market are
already being priced above
the RM1 million threshold
level and there is still a huge
disparity in property prices
between Malaysia and their
home countries.
The strong Singapore dollar
and growing interest from
other foreign purchasers
particularly in the locality
of Nusajaya and Medini will
continue to drive the growth
of the residential market.
Medini will continue to
76
be the ‘hotspot’ due to its
special economic zone
status whereby it is granted
a substantial tax break
and is exempted from
the RM1 million minimum
price threshold for foreign
purchase.
“The implementation of the
Transportation Blueprint
(2010 to 2030) which includes
forming an integrated transit
terminal network to link
major towns and gateway
terminals; developing a bus
rapid transit system linking
Johor Baru with Skudai, Johor
Jaya and Nusajaya is set to
transform the Iskandar region
into a bustling business
district and enhance its global
competitiveness.
Going forward, the Johor
Baru property market is
expected to remain firm in
the medium term with more
Malaysian and Singaporeanbased developers expected
to venture into the Iskandar
region.
“Development activities will
continue to be concentrated
within the city centre, Danga
Bay and the Nusajaya/Medini
locality within Zones A and B
of Iskandar. Besides highend condominiums and
apartments, with growing
demand for good quality
prime office space and retail
space, the region is expected
to see more retail malls and
purpose-built offices coming
up in the Iskandar skyline.
www.PropertyHunter.com.my
The local property
market will pick up in
the second half of the
year, following further
announcements from
the central bank on
lending guidelines, said
Andaman Property
Management Sdn Bhd
managing director Datuk
Seri Dr Vincent Tiew.
“From my observations
of the industry in
the past, I anticipate
further announcements
following these five
months or so post
budget 2014.
“People are somewhat
confused and prefer
to wait this period out.
Once buyers grasp a
better understanding
of all the guidelines,
many will want to
keep investing,” he
said at the sidelines
of Andaman Group’s
Loyal Buyers Reward
Programme ticket
distribution ceremony
for its Property Outlook
Conference 2014, which
took place over the
weekend.
To recap, Bank Negara
had set the brakes on
interest capitalisation
schemes and the
developer interest
bearing scheme last
year in an effort to cool
speculative activities in
the property sector.
Among other guidelines
announced during the
Budget 2014 included
the use of the net selling
price of a property –
which excludes rebates
and discounts – to obtain
bank loans , as well as
the reimposition of the
real property gains tax
(RPGT) of 30% for the
first three years upon
disposal.
“Further announcements
by the central bank
will not necessarily
be negative news to
investors. They could
be measures to curb or
better manage certain
classes of property
assets in t erms of loan
financing,” he added.
Tiew speculated that
sub-urban areas will
perform better in 2014
as small-town residents
still had cash to invest.
Andaman Property
started in 2005 with
its first residential
condominium project
in Subang USJ, worth
RM150 million in gross
development value
(GDV).
To date, Andaman
Property manages
more than 15 projects
in the residential and
commercial market in
the peninsula totalling
RM3 billion in GDV.
On the RPGT, Tiew said
the 30% levy on a profit
amount was fair.
“It would affect property
holders in the first half
of the year to hold on
longer to their real
estate but to me, it’s
an acceptable amount
to pay compared with
Singapore,” Tiew said.
Currently, the challenge
for property developers
was to manage the
consistency of business
flows and billing, Tiew
said.
“I expect prices to
increase by 10% as more
development charges
are being imposed on
new projects,” he said.
“As such, property prices
will not fall except in
the event of a world
economy slump.”
In view of cautious
consumer sentiments in
the face of rising costs,
Tiew urged investors
to hedge their financial
portfolio by investing into
real estate.
“Property players
targeting the middle
income group will
have to restrategise
because that market is
suffering. Seeing as the
affluent are not affected
by new rulings and
guidelines, the middle
income group – whose
household income sits
between RM2,000 and
RM10,000 – needs a lot
of reasoning,” Tiew said.