Written by: Guo Zhenhao

Desiring to live closer to work used to be a given. Who wouldn’t love shorter commute hours and more downtime?

Gardening Spaces Now a Sought-After Feature

A UK survey revealed that 63% of potential home-movers want access to gardening spaces within their homes. When viewing new property, buyers used to look at kitchen photographs to judge if they wish to buy homes. But recently, property agents have been receiving more requests to view pictures of gardens and outdoor spaces.

Buyers Demand More Functional Space In and Out of the Home

The 43% of prospective buyers wish to live in bigger property, and 36% of respondents cited better working space as a major criteria in their home hunt.

Other space related issues included living closer to parks and green spaces (31%), and living in pet-friendly homes (22%). Surprisingly, only 8% of home-movers wish to live closer to work. Proximity to work has been replaced by other coveted features, such as a good internet and a spare room.

A New Norm That Will Influence Property Price Bargaining

An implication that may arise is that sellers living closer to transportation might fetch less of a premium compared to before, while space and home functionality are set to become major bargaining chips in the property market for years to come.

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Written by: Guo Zhenhao

Redefining affordability could be the next step in providing tax rebates for Malaysians.

Perumahan Penjawat Awan Malaysia (PPAM) is an affordable housing scheme launched in early 2013 to enable low and medium income civil servants to afford homes in major towns. Since then, a slew of initiatives to make housing more accessible in Malaysia has been rolled out. Recently, a Valuation and Property Service Department (JPPH) report revealed that many of Malaysia’s Bottom 40 (B40) income earners experience difficulty buying homes priced between RM200,000 and RM300,000.

These homes consist of up to 43% of the property overhang in the first half of 2019.

Affordability Standards Vary Between States

Property consultants have weighed in, stating that the standard for affordability is subjective to each state. Land scarcity, population growth, and an ageing population are all factors that can cause housing prices to fluctuate.

Redefining Affordability Standards for Wider Housing Loan Accessibility

On the ground, Malaysians bemoan that buying a home is unfeasible even after working for years on end. Some Malaysians cite difficulty and shortage of aid when it comes to down payment.
The good news is, there’s better classifications to redirect tax dollars.
Some ministers have suggested classifying housing submarkets based on affordability. Arranging property in terms of value, and subsequently planning taxes, incentives, and income distribution could be the way forward for making homeownership accessible to Malaysians.

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Source: Free Malaysia Today

Written By: Henny Maherah

The Malaysia My Second Home (MM2H) Programme will freeze till December this year.

Foreigners Affected by Halt of MM2H Programme

Immigration laws continue to tighten in view of COVID-19. A staggering 90% of new MM2H applications have been rejected. This amounts to over 1,000 rejected applications, a sharp increase over the usual 10% rejection rate last year.

One of the factors that might have contributed to the sudden MM2H programme halt is the ongoing disagreement between the Tourism and Immigration Ministry in Malaysia. While health concerns may arise from letting foreigners enter the state, the MM2H initiative has also been an integral pillar of the local economy. This has left officials ambivalent in the decision making process, as both the health and economy of Malaysia took a hit as a result of the coronavirus.

MM2H Programme Remains Crucial to the Malaysia Economy

Since the introduction of the MM2H programme in 2002, RM40.6 billion has been pumped into the Malaysian economy, mostly through property purchases and compulsory fixed deposits in local banks.

Despite such uncertainties, foreigners looking to relocate to Malaysia need not worry in the long run as it is highly probable that the suspension of the MM2H programme is only temporary. Tourism, Arts, and Culture Minister Nancy Shukri reports that while the programme is currently under review, it is unlikely for it to be entirely cancelled given the significant economic benefits to the country.

Property plans in Malaysia affected by the MM2H Programme cease? Talk to our trusted in-house agents for professional advice about how we can help you achieve your property goals.

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Written By: Henny Maherah

Malaysia has been swept by new changes as the economy begins its recovery since the relaxation of the Movement Control Order (MCO). Key developments include revisions designed specifically to respond to the impact of COVID-19 on the property market.

PENJANA Stimulus Package and the Reintroduction of the Home Ownership Campaign

On 9 June 2020, the Malaysian government issued its fourth economic stimulus package, the Pelan Jana Semula Ekonomi Negara (PENJANA) package. Valued at 35 billion ringgit (US$8.1billion), the package aims to help Malaysians who have lost their jobs or experienced pay cuts as a result of the pandemic. The measures included in PENJANA include job protection and tax incentives as well as financial assistance for small and medium-sized businesses (SMEs).

The Home Ownership Campaign (HOC) will also be reintroduced as part of the PENJANA package to encourage more property buyers among Malaysians. Previously, the HOC successfully ran in 2019, clearing 31,415 residential units, valued at RM23.2 billion as of November 2019, surpassing the initial target of RM17 billion.

Malaysians will be able to benefit from the HOC in 2020 in several ways:

• Tax exemptions when purchasing property
• 10% discount from participating developers on the price of the property
• All properties sold from 1 June 2020 till 31 December 2021 will be exempted from real property gains tax

Since the introduction of these measures, there has been increased interest from homeowners looking to sell their property. “We are seeing more motivated sellers willing to negotiate prices as they know buyers have more choices,” stated Lim Boon Ping, president of the Malaysian Institute of Real Estate Agents reports.

Malaysian Tourism Sector amid Nationwide Tourism Campaign

Prior to the outbreak of COVID-19, the Ministry of Tourism, Arts and Culture (MOTAC) announced the fifth Visit Malaysia 2020 (VM2020). According to Minister Datuk Seri Nancy Shukri, the campaign aims to “strengthen the country’s competitiveness and sustainability in tourism while ensuring the industry is inclusive.”

Unfortunately, the pandemic resulted in the immediate cancellation of VM2020 as both domestic and international travel are prohibited worldwide. Within the first quarter of the year, the tourism industry suffered a loss of RM9 billion.

In a recent survey, about 15% of the hotels in Malaysia voiced apprehensions that they will not survive the impact of the outbreak and will have to resort to permanent closure. Several hotels ceased operations for good during the MCO, among them the Holiday Inn Resort in Batu Ferringhi. Despite its four-decade history as a tourist favourite in Penang, this landmark hotel was not spared from the economic impact of the pandemic.

Property Developers Change Strategies in New Normal

Property developers are encouraged to follow a two-pronged approach in managing the property market as demand gradually picks up.
Developing more affordable housing priced at RM500,000 and below
Continued efforts to clear overhang units, 80% of which come from the premium real estate sector

More Affordable Housing Units

Ceiling prices of affordable houses will face a reduction in an attempt to ensure housing remains accessible to all. In Penang, a 10% reduction for affordable homes priced beyond RM72,500 has been applied in June 2020.

Property developers in Malaysia are also adopting business strategies to fit the new normal. Some of them are focusing on competitively priced essential homes in strategic locations.

Essential homes refer to developments that focus on sustainability. Eco-friendly features would be integrated into these developments. Proposed locations of such developments include Melawati in Selangor, Sentul in Kuala Lumpur and Rubika in Butterworth.

Efforts to Clear Overhang Units

Speaking at a press conference after the launch of Grand Marais Suite, Housing and Local Government Minister Zuraida Kamaruddin explained that plans to revise property sales price and terms for foreign buyers have been made with the government in order to address the backlog of overhang units.

Responding to these revisions, the Penang local government has reduced its minimum price threshold for foreign property ownership. This reduction will aid in the clearance of the remaining 3,043 overhang units worth RM2.6 billion total.

As the property market continues to grapple with the effects of COVID-19, targeted incentives and state initiatives will continue to help the Malaysian economy recover fully in the new normal.

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