BY VIKTOR CHONG
viktor@mystar.com.my

Priority on first-time homebuyers and lowering the cost of business

Iskandar (centre) with members of the press

PETALING JAYA: The Real Estate and Housing Developers’ Association (Rehda) proposed several changes to be considered by the government, mainly to address affordability issues for first-time homebuyers as well as developer’s cost of business. The budget 2018 wish-list was revealed at a closed luncheon with the media last Thursday.

Rehda president Datuk Seri FD Iskandar is optimistic that the government will consider the 11 proposals that were made under the theme “Negaraku: Shaping The Future”.

“The government will have to balance our request with the financing of the country as over hundred other organisations are asking for something. However, looking at how important housing is, especially affordable housing, we hope that they will look at three or four important points in the wishlist, such as the cost of doing business, financing and GST,” he said.

According to the Budget 2018 wishlist, Rehda proposed a Home Ownership Assistance Programme (HOAP) to the Ministry of Urban Wellbeing, Housing and Local Government (KPKT). The HOAP targets first-time homebuyers, including those who have sold their previous home to upgrade and relocate. This new scheme is directed towards houses below the RM500,000 mark and for those whose household income is RM10,000 and below. This scheme will not be applicable for cash buyers.

Concerning the stamp duty financing scheme, Rehda also suggested that this exemption is extended to more properties of higher threshold but falls under the category of affordable housing. Currently, the 100% stamp duty exemption is only applicable to houses below RM300,000 in Budget 2017.

Another proposal addressed the assistance that can be provided by the Account II of EPF to pay developers for the 10% downpayment. Rehda also appealed for the percentage of contribution to be accredited to Account II be increased from 30% to 50%, applicable only to first-time homebuyers.

“However, there is a concern that people will not have enough money when they retire. This is because the lifespan of Malaysians has increased. The average life expectancy is now at about 74 years old,” Iskandar said.

Touching on the PR1MA houses, Rehda applauded the government for introducing a Special End-financing Scheme during the 2017 budget last year which provides buyers with end-financing up to 90 to 100%. Rehda suggested that a similar scheme to be extended to private developers.

Iskandar also believed that the government should attempt to waiver GST for homes under the RM500,000 category. “Currently developers are paying 6% GST for bricks, cement and roofing materials. They should charge them only if it’s above the RM500,000 mark,” he said.

“There has been a levy on steel introduced February this year. Previously we are paying RM1,700 per tonne, but now it is at RM 2,728 per tonne. This cost will be passed on to potential homebuyers. We are looking at the cost that can be controlled such as conversion premium, development charges and infrastructure contribution funds,” Iskandar said.

Further assessment included the suggestion to utilise government and state-owned land for the provision of affordable housing, especially if the land is not used optimally. Issues like standardisation of Bumiputera Quota Policy across states and the reduction of threshold price for foreigners were also being addressed.