The exemption of RPGT between 2007 and 2009 and the entry of DIBS in early 2009 created fertile ground for speculation. Home prices have increased by between 20% and 30% annually in urban centres, a situation PEPS president Lim Lian Hong said was “unhealthy” and needed to be corrected.
“Research by RAM (Ratings Agency Malaysia) into the past 50 years shows that a steady annual growth of 7% is healthy for the market,” said Lim, who is also the executive director of Raine & Horne International Zaki+Parners Sdn Bhd.
He said the property sector was an important part of Malaysia’s economy – or any other country for that matter – and that excessive speculation had a destabilising effect on the overall economy.
“The RPGT is an important anti-speculation tool, and with the removal of DIBS, we expect the market to self correct in the next six to 12 months,” Lim said, adding that affordable houses must be build as quickly as possible.
On the impact of the 6% goods and services tax (GST), buyers will try to complete transactions before April 1, 2015 when the GST is enforced. There may be a dearth of launches after the GST is in place.
He said the imposition of GST, the removal of DIBS and the RPGT must be considered in totality.
Although housing is GST-exempt, there will be an impact on house prices. At the same time, the RPGT will weed out speculative elements and remove the artificial element in the market.
A check with a developer showed that they have removed DIBS packages starting yesterday.
The developer will discuss with its bankers and lawyers as there is a lack of clarity when the scheme is prohibited. The move would not be retrospective, a marketing personnel said.
Separately, in a statement, C H Williams Talhar & Wong Sdn Bhd managing director Foo Gee Jen said it was “surprised at the quantum”.
Foo said he had reservations that foreigners had been discriminated against with a 30% RPGT imposed for all five years.
“Considering that foreign investments in Malaysian properties have been consistently encouraged, RPGT should have been equally applied to Malaysians and foreigners at the same rate.” he said.
