News & Articles How Budget 2016 Affects the Property Market
How Budget 2016 Affects the Property Market
3 Nov 2015
The 2016 budget was recently presented by our Prime Minister, Datuk Seri Najib Razak on live television and there were many who wondered exactly how they would be affected by it. In this article we try to cover the property related aspects that the budget touches and how they might change situations relating to agents, property owners, property buyers and the like.
Resources Pooled Towards Developments in the South
There has been a lot of budget channelled towards developments in the area of south Selangor and Negeri Sembilan. Firstly, the Malaysia Vision Valley project that spans from Nilai to Port Dickson which is projected as the next growth region. Additionally, there is the planned Cyberjaya City Centre which is 141 acre commercial area planned in Cyberjaya and Aeropolic KLIA which is a 1300 acre urban centre in Sepang.
More Affordable Housing
RM 200 million has been allocated to subsidize homes built under the PR1MA and Program Perumahan Rakyat home scheme for first time home buyers and an estimated 20,000 to 30,000 potential house owners will benefit from this scheme as more than 300,000 affordable housing units have been planned.
Reducing Speculation
Continuing from previous year’s budgets, the government is maintaining several steps in order to reduce speculation that is driving up the property market price. These steps include continuing the Developer interest-bearing scheme (DIBS), where developers are required to bear the loan interest of their buyers until their project reaches completion.
Another step is to maintain the interest of the Real Property Gains Tax (RPGT) at about 30% to discourage price flipping by developers upon a project’s completion.
Exemptions on Syariah Compliant Loans
Those that opt for Islamic banking based home loan and are taking this loan for their first home will be given an exemption of 20% off stamp duty during the loan application and processing.
High Income Buyers
The buying propensity of high income earners may be reduced as the government plans to increase their income tax rates, discouraging them from spending on extra property.
The Pan Borneo Highway
This is especially good news for East Malaysians as the announced highway is expected to increase accessibility across Sabah and Sarawak, thereby spurring residential, commercial and industrial developments along its route.
Properties near the LRT
With several new stations ready and several more in the works, the value of property around these new stations can be expected to rise dramatically in the coming months and years.
Resources Pooled Towards Developments in the South
There has been a lot of budget channelled towards developments in the area of south Selangor and Negeri Sembilan. Firstly, the Malaysia Vision Valley project that spans from Nilai to Port Dickson which is projected as the next growth region. Additionally, there is the planned Cyberjaya City Centre which is 141 acre commercial area planned in Cyberjaya and Aeropolic KLIA which is a 1300 acre urban centre in Sepang.
More Affordable Housing
RM 200 million has been allocated to subsidize homes built under the PR1MA and Program Perumahan Rakyat home scheme for first time home buyers and an estimated 20,000 to 30,000 potential house owners will benefit from this scheme as more than 300,000 affordable housing units have been planned.
Reducing Speculation
Continuing from previous year’s budgets, the government is maintaining several steps in order to reduce speculation that is driving up the property market price. These steps include continuing the Developer interest-bearing scheme (DIBS), where developers are required to bear the loan interest of their buyers until their project reaches completion.
Another step is to maintain the interest of the Real Property Gains Tax (RPGT) at about 30% to discourage price flipping by developers upon a project’s completion.
Exemptions on Syariah Compliant Loans
Those that opt for Islamic banking based home loan and are taking this loan for their first home will be given an exemption of 20% off stamp duty during the loan application and processing.
High Income Buyers
The buying propensity of high income earners may be reduced as the government plans to increase their income tax rates, discouraging them from spending on extra property.
The Pan Borneo Highway
This is especially good news for East Malaysians as the announced highway is expected to increase accessibility across Sabah and Sarawak, thereby spurring residential, commercial and industrial developments along its route.
Properties near the LRT
With several new stations ready and several more in the works, the value of property around these new stations can be expected to rise dramatically in the coming months and years.
Source: DurianProperty.com