/// West Malaysia Property News
No RM1 Million Price Floor for Foreign
Buyers in Iskandar, Says Report
Foreigners planning to purchase
property in Johor’s Iskandar
region will soon be exempted
from the minimum purchase
rule of RM1 million, Singapore’s
Straits Times reported.
Quoting an industry source, the
daily said that projects approved
by Johor authorities before May
1 this year would be exempted
from the ruling, first announced
by Prime Minister Datuk Seri
Najib Razak when tabling the
Budget 2014 last October.
Under the new rule, the
minimum value of properties
that foreigners could buy is
doubled to RM1 million, from
RM500,000, as a measure to
address rising property prices.
Najib had also announced
that Real Property Gain Tax,
or RPGT for non-Malaysians, is
imposed at 30% on the gains
from properti es disposed within
5 years, while for disposals in
the sixth and subsequent years,
RPGT is imposed at 5%.
The deferment of the ruling will
come as a relief to property
developers in Malaysia who have
already started on their projects,
reported The Straits Times.
“They (Johor’s state authorities)
understand that the market is a
bit shaken by these measures,
particularly the projects that
have gone quite far ahead,” the
paper quoted a source as saying.
“There’s a tendency now to let
them go through and extend
the cut-off point to May 1. So
developers that have submitted
and received approval before
that should be safe.”
62
www.PropertyHunter.com.my
Penang Developer Gets Show-Cause Letter
for Jacking Up House Price
The exemption is expected to be
announced in a few weeks.
According to The Straits
Times, the minimum price
announcement had “sparked
frustration” among developers,
upset that they would be forced
to amend their projects, and
leaving them no choice but to
build bigger units to price the
property at RM1 million.
Smaller property developers
could be the hardest hit as they
have limited land space.
“(These developers) have smaller
parcels of land with limited
capital. Although their traditional
market is local buyers, foreigners
could still be potential buyers,”
the daily quoted an executive
from a property firm in Malaysia.
“But now they have to make the
hard choice between making
bigger units which could erode
margins to woo foreigners or
completely lose out on the
foreign buyer segment. They are
in a dilemma.
A developer in Penang has been
slapped with a show-cause letter
from the state government for
charging low-medium cost house
buyers more than double the price
of the units.
Jagdeep Singh Deo, who is state
housing exco, said the Penang
government will not tolerate
developers not following the
requirements for low-medium cost
housing.
“We want to hear what the
developer has to say to explain this
issue,” he said.
“We have asked the buyers who
face this problem to meet with state
housing committee representatives
to resolve their problems,” said the
Datuk Keramat assemblyman.
Yesterday, a group of house
buyers protested outside the state
administration offices in Komtar
with one man getting down on his
knees to beg the Pakatan Rakyat
government for help.
The paper also reported of
speculations that RPGT could
also be adjusted as developers
worry about property market
affected by the new measures
announced by Putrajaya.
The buyers were angry with the
developer of Centrio Avenue for
increasing the prices of the lowmedium cost houses they had
signed to buy from RM72,500 to
RM168,000 last November.
“The main thing here is that the
policy makers need to make
sure they don’t kill the market
by making potential investors
nervous about Iskandar,”
a senior executive from an
Iskandar told The Straits Times.
The extra charges were for
parking lots at RM28,500 each and
RM60,000 for a renovation package.
“We are comforted that, to
some extent, they are being
considerate to the businesses by
making these adjustments.”
Jagdeep said the developer could
not force the buyers to pay extra for
renovations they did not ask for.
He said the state government had
met with the developer, who has
agreed to resolve the matter.
“I am not satisfied that after two
months of meetings, many of the
cases are still unresolved.
“We know that the group of buyers
had meetings with the developer.
We are aware of what transpired
during the sessions held in
December and two meetings on
January 13 and 24.
“I have been calling the developer for
updates,” he said.
The Centrio Avenue project was
launched in 2008. The low-medium
cost units with a built-up space of
650 square feet each are expected
to be ready for occupation in March
2014.