PETALING JAYA: Developers are generally expecting a challenging market for 2014 as a result of the cooling measures introduced by the Government in Budget 2014, a survey conducted by the Real Estate and Housing Developers’ Association (Rehda) revealed.
The survey, which polled 150 Rehda members from 12 states across peninsular Malaysia, revealed that 87% of the respondents were “pessimistic or neutral” on the outlook for the real estate industry for the first half of 2014.
As for the outlook in the second half of 2014, a total of 75% of the respondents were “either neutral or pessimistic” .
Rehda president Datuk Seri Michael Yam said the various cooling measures were “gaining traction” and would have an impact on the local property market.
“Due to the cooling measures, developers will scale back on their launches. Supply is being held back but the demand is there,” he said at a media briefing yesterday onRehda’s property industry survey for the second half of 2013.
According to Rehda chairman of communications, public relations and publication committee cum national treasurer, Datuk NK Tong, the number of project launches also dropped in the second half of 2013 compared with the previous corresponding period.
“Overall cost of doing business had also increased in the second half of last year,” he said, adding that unreleased bumiputera lots remained the number one reason for unsold units during the period.
“We’re hoping that during these trying times, the Government will look at the bumiputera quota issue, especially in Malacca, where there were 852 units completed with CFO (certificate of fitness for occupancy) as at Dec 31,” he said.
Yam said the quota allocation for bumiputera units in Malacca was at 60%.
“If you use an average price of RM250,000 per unit, at 850 units, that’s over RM200mil trapped in the system, which the developers have to bear.
“It’s not as though the bumiputera units will remain empty.
“Eventually they do get sold.
“But because there is no official regulation, developers are fearful and hold back these units,” he said, adding that bumiputera units did not appreciate as much as the non-bumiputera ones.
The survey also revealed that 74% of the respondents believed that the implementation of the Goods and Services Tax (GST) would have an adverse impact on the property industry once it is implemented in April 2015.
According to Rehda’s immediate past president and finance and investment committee chairman Datuk Ng Seing Liong, the association had submitted various proposals to the Government concerning the GST.
Among the proposals is for the Government to have the stamp duty on transfer of real property to be maintained at the current maximum 3% instead of the proposed 4%. - The Star