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  • Will New Property Curbs Affect Iskandar Malaysia?
  • Will new property curbs affect Iskandar Malaysia?

    FOR many property developers, Iskandar Malaysia remains a hugely lucrative market. Projects keep mushrooming throughout the area as developers launch their prized, high-end houses to a crowd of waiting buyers.

    Property sales appear to be robust there, and now UEM Sunrise Bhd, the company with huge tracts of land in Southern Johor, says it’s going to be better.

    The company’s CEO yesterday said the weaker ringgit against the Singapore dollar and Singapore’s continued drive to keep the lid planted on the boiling pot that is property prices in the republic should drive up the company’s revenue and sales.

    In fact, newcomer Eco World Development Sdn Bhd is launching its maiden project in Iskandar Malaysia by selling cluster homes and semi-detached houses to buyers predominantly from Malaysia and overseas.

    Malaysia-based developers have found that a lot of sales of property in Iskandar Malaysia are by residents but foreign purchases are also rising.

    Country Garden Holdings Co Ltd, one of the largest property companies in China, has been marketing its properties at Country Garden Danga Bay project to eager buyers from China.

    Yesterday, Tan Sri Danny Tan finalised a deal to sell US$621mil worth of property toAlbedo Ltd in a reverse takeover of the company. That will change the iron and steel company into a Singapore-based property company that will market Iskandar properties to buyers in the island. With so much supply of new houses being planned and more in the pipeline, all eyes though will be on Budget 2014 and the possible measures to cool down the property market in Malaysia.

    What policy makers are concerned about won’t be the million dollar plus homes being built for rich Malaysians and foreigners.

    They will be concerned about just how Malaysians will be able to fork out an ever-increasing percentage of their monthly take-home pay to purchase a slice of a humble Malaysian dream.

    As it stands the average price of homes in the Klang Valley makes it difficult for a lot of people to buy a residential unit.

    The idea on correcting that is to hike the real property gains tax, a move that is designed to penalise speculators instead of real home buyers.

    Also being talked about is raising the floor price of homes foreigners are eligible to buy. Right now that’s at RM500,000 and talk is that it may be raised to RM1mil. A boss of a property company remarked recently that maybe the Government should look at having a tiered floor price, where a higher price could be set for larger homes instead of a flat price for all units.

    Whatever the case may be, maybe homes in Iskandar Malaysia may get an exemption. Precedence in giving preferable income tax rates for businesses inIskandar Malaysia has been made and any punitive measures to bring property prices in check may not be applied fully for homes there. There will be pros and cons if that is done.

    What is needed though are moves to rein in property prices.

    Business Editor (features) JAGDEV SINGH SIDHU is looking to see if property cooling measures will be more than just a slap on the wrist.