By BUSINESS TIMES
A SURVEY of local property developers indicates that the recently introduced policies to revitalise Malaysia’s real estate sector have yielded initial returns.
More than a fifth of respondents (22 per cent) said sales enquiries have increased, with 18 per cent having turned potential purchasers into actual buyers.
Among the factors contributing to the healthier sentiments were the bullish local stock market and accommodative policies, including the withdrawal of the real property gains tax (RPGT) and less bureaucracy for foreign buyers.
The survey, by the Real Estate and Housing Developers’ Association (Rehda), was conducted from April 21 to May 8 this year, and involved 153 Rehda member companies.
Respondents said enquiries from locals and foreigners rose an average 35 per cent and 10 per cent respectively, while sales to local and overseas buyers increased 32 per cent and 8 per cent respectively.
“These are visible signs of improvement. But the survey also identified stumbling blocks,” Rehda president Ng Seing Liong said at a media briefing in Kuala Lumpur yesterday.
He said respondents felt that regulatory inconsistencies could hamper efforts to generate more confidence in the country’s real estate market.
Furthermore, players are hit with costlier building materials like steel and cement, which may squeeze profit margins as well as make properties more expensive to buy.
Meanwhile, analysts said that although the abolition of the RPGT may boost property transactions, it could also affect the pricing of newly-launched houses as buyers can sell their units quickly without being taxed.
“Malaysian property developers tend to sell the first phase of development at cheaper prices and subsequently increase the prices for the next phase.
“Now, the owner who bought a unit in the first phase can make quick cash by selling at a lower price compared to the developer’s, hence affecting the developer’s pricing power,” TA Securities Holdings Bhd analyst Kamarulzaman Hassan said in a recent property sector report.