Boost needed for soft property market in 5th year of subdued outlook: REHDA

GEORGE TOWN: Penang's Real Estate Housing Developers Association (REHDA) hopes the Finance Ministry can find new initiatives for builders to weather the soft property market which has entered its fifth year of a subdued outlook.
Its chairperson Datuk Toh Chin Huat said there is nothing much to celebrate for now although the economy has shown positive signs of a rebound.
"Poor sentiments and the uncertainties continue to grip the market," he said. "Although the economy is showing some positive indications, a period of uncertainty has descended in terms of the impending general election. It prolongs the wait-and-see stance of many potential investors."
Toh was speaking at the 43rd-anniversary celebrations of REDHA in Penang.
There is also a concern whether tomorrow's tabling of Budget in Parliament would see a proposed one percent increase in stamp duty for properties transacted at above RM1 million, Toh revealed.
The increase may impact corporate manoeuvres as at times, conglomerates transfer their assets among the subsidiaries and this means there is an increase in cost as they need to purchase stamp duties as part of the process, he said.
Developers are also hampered with having to subsidise all forms of affordable housing, as it sometimes may not be tailored to the market demands. For example, a developer may need to build the 30% requirement for low medium costs units on its project site where there is no demand for such units, he added.
"It creates an indirect glut capacity," Toh said.
He said that developers are an integral part of nation-building; their companies are partners with the government in creating adequate housing, social amenities and infrastructure to power the economy.
"We are a huge industry with over 20,000 jobs created in Penang alone."
"It is important for the public and private sectors to work together; to bring a harmonious progress without compromising the environment."
Penang Chief Minister Lim Guan Eng, who was present with most of his state executive councillors, said the state will listen to the grievances of the developers, but stressed that some matters lie in the federal hands.
He said the root evil of a slowdown, was the rising living costs, worsened with the dependence of the government on the Goods and Services Tax (GST).
"I heard there would be a surprise during the unveiling of the Budget. Perhaps, the Government may revoke this consumer-driven tax."
If the government does not do it, Lim promised that if Pakatan Harapan was given a chance to govern at the federal level, it would be the first item that they would revoke.