Offer grants to first-time house buyers: Rehda

The government should offer housing grants to first-time buyers to lessen their burden amid the current economic turbulence, a top property official said.

Real Estate and Housing Developers' Association (Rehda) Malaysia president Datuk Ng Seing Liong said the grants will help stimulate the sector, which is depressed with selective buying.

"The policy has worked in Australia and we hope that the Malaysian government will look into it.

"We have proposed it many times. Tens of thousands of new home buyers will directly benefit from the fund," Ng told Business Times at a Rehda Open House in Bandar Utama, Selangor, last Friday.

In Australia, buyers benefit from savings with grants of up to A$10,000 (RM24,100) per home, reducing their holding costs.

Ng said the biggest challenge for developers this year would be gaining buyers' confidence.

"We expect their confidence level to drop in the first six months of the year. People are more cautious because of rising global economic uncertainties. Investors and buyers are thinking of spending more on essential items over property," he said.

Rehda expects property launches to slow 15-30 per cent this year.

According to Ng, developers in the country launch on average between 100,000 and 200,000 new homes a year.

"Without doubt, the market is slow. With this economic downturn, definitely, there will be a drop in demand and launches," he said.

"We maintain that property prices will drop by 5-15 per cent, but not in all locations. Choice locations will still be Mont'Kiara, Damansara, Bangsar and the KLCC enclave."

In May last year, there were shouts from developers that property prices would increase by 30 per cent as building materials became more costly.

But when the prices of raw materials dropped in the second half of the year, it brought down cost, which enabled developers to continue their projects.

However, buyers have adopted a wait-and-see attitude, resulting in slower sales. - By Sharen Kaur (Business Times)

No comments