Financing

Questioning DBKL’s move on KLites

Justifying the proposed assessment rate hike THE media has reported that two former mayors – Tan Sri Ahmad Fuad Ismail and Tan Sri Elyas Omar – have questioned the Kuala Lumpur City Hall (DBKL) on its proposed assessment rate hike. Ahmad Fuad, predecessor to the current mayor Datuk Seri Ahmad Phesal Talib, pointed out that he had raised reserves amounting to RM3bil prior to retiring last year. This means Ahmad Phesal inherited RM3bil when he took over. Ahmad Fuad reportedly said that DBKL must provide a detailed budget for 2014, with a breakdown of how much money was needed and how it would be spent. Elyas, meanwhile, noted that DBKL had “bigger revenue compared to what it had 30 years ago”, adding that there was no need to increase rates “even by 10%”. DBKL must be selective and make a di...Read More

Purchasers’ risk in progressive payment

THE National House Buyers Association (HBA) has complained to the Minister and those under his charge about purchasers becoming victims when they lose their homes as a result of foreclosure proceedings taken against them by banks to recover loans taken by developers secured by purchasers’ houses bought from the same developers, because the said developers did not settle the loans taken by them. The crux of the problem is that the Housing Ministry-prescribed sale and purchase agreement (SPA) allows the developer to build the purchaser’s house with the instalments of the purchase price paid by the purchaser from the day the SPA is signed. On top of this, and even more seriously, the developer is allowed to borrow from the developer’s banks on the security of the purchaser’s property. The pur...Read More

New government, new hope for Malaysian property market?

Pakatan Harapan’s policies and programmes as outlined in The People’s Manifesto provide great anticipation for homebuyers, developers and investors alike. If done right, these strategies will go a long way in curbing the housing affordability conundrum.  The 14th Malaysian General Elections (GE14) on 9th May 2018 will go down in history as one of the most memorable days for millions of locals nationwide. The majority voted in favour of the opposition alliance to serve as the country’s new government – the Pakatan Harapan (PH) coalition trumped Barisan National (BN), which has been in power for 6 decades. We are all excited to see how PH will bring forth positive change; the new government has promised a reformation of Malaysia’s administration and politics as well as sustainable growth and...Read More

Buyers: Cheap homes too small, too few, too far away

PETALING JAYA: So-called affordable homes are too small, too far away and too few, the national house-buyers’ association said today, disputing a claim by developers of an oversupply of affordable homes. The National House Buyers Association (HBA) also criticised the unrealistic definition of “affordable homes” used by the Real Estate and Housing Developers’ Association (Rehda). HBA secretary-general Chang Kim Loong concurred with Bank Negara Malaysia that most Malaysians could not afford homes costing between RM300,000 and RM500,000, which falls within Rehda’s definition of affordable housing. Chang said the price should be between RM150,000 and RM300,000. Speaking to FMT, he pointed out that Bank Negara had in fact estimated the maximum price of an affordable home to be only RM282,000, d...Read More

Malaysia’s property market in 2016: What to expect & predictions

INDUSTRY EXPERTS Warrick Singh Director of Business Development/Training of Asian Realty Sdn Bhd, Asian Land Auctioneers Sdn Bhd/Starfish Training Sdn Bhd  As we move into 2016, the ‘cloud of uncertainty’ hanging over the Malaysian economy would settle somewhat preceding several recent capital measures, such as the purchase of Malaysian bonds, intra-trade in Chinese Renmimbi instead of US Dollar and the offer of RMB50 billion of a protected Chinese capital market. Also, the development of the LRT/MRT lines which enhances connectivity to Greater Klang Valley including Seremban, Rawang and Klang will bode well for the residential and commercial property market. Malaysia generally has a young population where 80% of Malaysians are below the age of 50, which means the demand for houses is only...Read More

Is RENT-TO-OWN the answer to home ownership?

Let’s face the elephant in the room, shall we? For most Gen Ys out there, obtaining a home loan in the current economic condition seems like ‘Mission Impossible’. When you cannot purchase a house, rent instead, some people would advise. However, unbeknown to many Malaysians, there is a third option available – the rent-toown (RTO) scheme. The RTO concept operates based on a lease-purchase contract, between a buyer and developer. The buyer will first rent a property from the developer with an option to purchase at the end of the contract period, which could range from 20-30 years. There is also an option fee involved which must be paid by said buyer; a typical figure is roughly 5% of the property price. In RTO deals, a certain percentage of the monthly rent paid will be credited to the prop...Read More

HBA Maintains Easing Lending Guidelines is not the Solution to the Inaccessibility of Affordable Housing Loans

  PETALING JAYA: Relaxing banks’ lending criteria is not the solution to address the issue of access to affordable housing loans, said the National House Buyers Association (HBA) secretary-general Chang Kim Loong. “The current problem is that house prices are too expensive in relation to the buyers’ income. This has resulted in some prospective house buyers having their loan applications rejected. However, the solution is not to relax lending guidelines but to find ways to lower property prices. The relaxation of lending guidelines will surely worsen the situation and speed up the road to a ‘homeless generation’ that HBA has been warning about for years,” he told SunBiz, addressing the Real Estate and Housing Developers Association’s (Rehda) call for banks to be less strict in their l...Read More

Moneylender licence ‘ill-advised’ proposal

HBA says scheme will drag house buyers deeper in debt THE National House Buyers Association (HBA) views with grave concern on the statement by the Urban Well-being, Housing and Local Government Minister Tan Sri Noh Omar that eligible housing developers can now apply for moneylenders licences to provide loan facilities of up to 100% to property buyers. Instead of assisting house buyers get a “soft loan”, it seems that house buyers are dragged into deeper debts unwittingly. Such a “scheme” will only bring more harm than good and we will attempt to elaborate why. Interest rates The effective interest rate for a conventional housing loan, from banks and financial institution, ranges between 4.6% and 5% depending on various factors such as the amount borrowed, risk profile of the borrower, dura...Read More

HBA proposals for Budget 2016

THE National House Buyers Association (HBA) was invited to attend the annual Budget Consultation last Monday at PutraJaya International Convention Centre (PICC). This year’s theme was “Strengthening Growth, Enhancing Inclusiveness, Ensuring Fiscal Sustainability”. Although HBA has submitted our proposals to the secretary-general of the Federal Treasury for next year’s budget to enable our Government to consider them from the house buyers’ perspective, we thought it necessary to bring this up at the public forum. Having accorded the usual salutation to our Prime Minister who is also the Finance Minister, we begin to describe Budget 2014 and 2015 vis-à-vis housing as an ‘excellent mathematical formula’ to curb the unbridled escalation of house prices, which has in the last five years skyrock...Read More