Kota Kinabalu: The "softening property market" in Sabah can be improved if the Federal Government change its policies and introduce attractive incentives to the house buyers.

Secretary-General of Sabah Housing and Real Estate Developers Association (Shareda) Datuk Susan Wong Siew Guen said by increasing the affordability of local house buyers, it would help to boost the property market in the state.

Under this proposal, she said Shareda proposed nine-rescue plan with a view to enhance the buyers' purchasing power starting with a grant of RM20,000 for first time house buyers.

Citing the Australian government, he said it provide incentive of AUD$21,000 to buyers who are purchasing their first house.

"Apart from Australia, the US, UK and other countries also offer similar cash grant or supporting packages for their first time home buyers," she said when presenting her views at the roundtable discussion organised by the Institute for Development Studies (IDS) Sabah recently.

She said the grant should only be temporarily implemented for one or two years until the property market has been improved.

Shareda also suggested that the government allow EPF contributors who are purchasing their first house to withdraw 50 per cent of their total savings in EPF instead of the present limit of 30 per cent.

Susan said this practice would enable the buyers have sufficient fund to pay for part of the property price.

To further decrease the buyers burden, she said the stamp-duty for houses that cost RM500,000 and below should be totally waived while houses with price more than RM500,000, only 0.5 per cent stamp duty should be levied.

"We propose that the stamp duty waiver be implemented for a fixed period of one or two years from now," she said.

She reminded that during the severe Asian financial crisis in 1997, the Malaysian Government had waived the stamp duty for purchase of all types of properties at any amount for a period of one year.

She said it had been proven at that time that such practice had successfully enhanced the property market by boosting up sales.

Shareda also, she said appeal to Bank Negara Malaysia (BNM) to further reduce the Base Lending Rate (BLR) to four per cent citing the US and Japan who reduced their respective interest rates to almost zero since the financial crisis started more than six months ago.

The BNM recently reduced its BLR from 6.5 per cent to 5.95 per cent.

To another suggestion, Susan said the housing loan repayment period ought to be extended to 40 years or longer and the maximum age of borrowers increased from the present 65 years old to 75 years old.

She said it would enable the borrowers to pay at an affordable and lower monthly repayment of their housing loans.

For families who are in the prospect of losing their houses to foreclosure due to insufficient fund to meet the monthly loan repayment, she said Shareda appeal to the government to introduce a special plan to restructure and refinance the existing non-performing housing loan.

She said the government could introduce a longer repayment period with lower bank interest.

"This will allow borrowers to lower their monthly loan repayment to affordable levels.

"Subsequently, this will reduce the foreclosure rate in Sabah property sector so that families are given a chance to rebuild," she said.

Susan, who is slated as the incoming president of Shareda, said the government also should consider tax deduction on housing loan interest incurred for all types of residential property as well to reduce individual and corporate taxes.

"This will get everyone to enjoy more take home pay and in turn encourage spending," she said.

The Federal Government has also been urged to expedite the implementation of the Sabah Development Corridor (SDC).

Susan said that by doing so, it would create more job opportunities that would become key driver for the property market growth.

To stimulate the property market even further, she said the government must strive to attract foreign property buyers.

She suggested that the Federal Government allocate special fund to include property sector road shows by Sabah Tourism Promotion in order to attract more tourists from all over the world to travel and invest in Sabah.

"We would also like to request the government to allocate more funds to improve the infrastructure and public transportation system in Sabah because this play an important role in promoting tourism and property development in the state," she said.

She said the government should consider extending the multiple entry visa to qualified foreign applicants under the Malaysia My Second Home (MM2H) to 20 years or more so that foreigners would feel more at home here.

Susan said it is imperative that the government fast track the approval for MM2H applications.

If the government accepts Shareda's proposals, rescue plans and suggestions, she voiced confidence that Sabah property market and Malaysia's economy as a whole would be strengthened.

The association, she said hoped all that would be included into the government's next stimulus packages.

She envisioned that the positive effects of the stimulus packages would take between six and 12 months for the results to be in effect after implementation.

Also present were Shareda President Kong Kwok Wah, Associate Director of IDS who represented the organising chairman of the roundtable discussion, Chong Vun Thein, Managing Director of Sabah Urban Development Corporation Sdn Bhd Abu Bakar M. Yahya and Chairman of Institution of Surveyors Malaysia (ISM) Liaw Lam Thye.

Source: Daily Express

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