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Saturday, April 7, 2012
Tuesday, April 3, 2012
10-20pc increase in house prices healthy, says Donald Lim
By Lee Wei Lian
The Malaysian Insider
KUALA LUMPUR, April 3 — Malaysia is not experiencing a property bubble and price increases of up to 20 per cent per year is acceptable, said Deputy Finance Minister Datuk Donald Lim today.
This comes as increasing numbers of Malaysians, especially city dwellers, have become concerned over the affordability of housing.
Lim said the government wanted to ensure healthy growth in the property market which would give better returns than money parked in fixed deposit accounts.
“An average increase in house prices of 10-15 per cent per annum is healthy as compared to fixed deposits in the bank,” Lim said in a press conference today. “For areas like KL, a 20 per cent increase is quite acceptable.”
When asked whether such a high annual increase in property prices is out of sync with annual income increases in the general population, Lim said that KL is still cheap compared to some of its Asean neighbours.
“We know at the moment that prices are low compared to Thailand and Singapore,” he said. “We are talking about the coming three to five years (for house price increases) after which there is a stabilising period.”
Lim said that the government was monitoring the situation and had taken pro-active steps to avoid a sub-prime crisis from happening in Malaysia.
“We will intervene when we find the figure (for property) has shot up too high,” he said.
He said, however, that one of the measures introduced last year to combat rampant property speculation — the increase of the real property gains tax (RPGT) from five to 10 per cent for houses sold within two years — had not met with stiff resistance.
“A lot of people find it (the increase in RPGT) reasonable,” he said.
Property prices in urban areas such as Penang and Kuala Lumpur rose by up to 40 per cent in 2010 fuelled by low interest rates and a surge in speculative buying, although prices grew slower last year due to dampened sentiment from tightening measures such as a hike in the real property gains tax for early disposals.
Some reports have also estimated that property prices jumped from 5.9 times income in 1989 to 10.9 times in 2010.
The Demographia International Housing Affordability Survey rates markets, whose property prices are 5.1 times median income or more, as “severely unaffordable”.
The House Price Index (HPI), as prepared by the Valuation and Property Services Department, rose 7.5 per cent in the second quarter of last year as compared with the same period in 2010.
For urban centres like KL, to which young working adults are gravitating, the HPI has seen a rapid increase since 2004, growing relatively slowly from 100 in 2000 to 108 in 2003, before rising sharply from 115 in 2004 to 167 in the second quarter of last year.
Lim said in a speech today that the overall HPI has increased 6.6 per cent to 156.9 in the fourth quarter of last year.
He said that the value of All House Price in Malaysia hit RM217,297 in the fourth quarter.
Kuala Lumpur had the highest All House Price at RM487,219 followed by Selangor at RM327,237.
While Asia appeared to have escaped the house price crash that affected the US and parts of Europe, some governments in the region took steps to cool the rapid increase in house prices in an effort to avert a property bubble.
The value of Singapore’s private homes suffered their first quarterly drop in nearly three years following government-imposed measures to cool the property market.
Advance estimates from the Urban Redevelopment Authority (URA) yesterday showed that private home prices fell 0.1 per cent in January-March as compared to the last three months of 2011.
Chinese Premier Wen Jiabao was also reported as saying on March 14 that home prices in the world’s second largest economy were still far too unreasonable and the Chinese government could not relax curbs on the property market as it could result in “chaos”.
Wen also said that reasonable housing prices should reflect personal income, investment and reasonable profits.
----------Vulcan agreed----------
HBA Secretary General Chang Kim Loong said in October last year that the increase of RPGT from five to 10 per cent for houses sold within two years of purchase would be meaningless to short-term speculators looking to flip houses for profit.
He pointed out that properties are typically not allowed to be sold during the construction stage, which takes two to three years, and therefore, raising the RPGT from five to 10 per cent for properties sold within two years would have little impact.
Chang said that under the revised RPGT, speculators could purchase properties from developers during a launch and flip the properties on completion after two years and would have to pay only the same existing five per cent up to the fifth year, after which all profits are not taxable.
----------Vulcan agreed----------
Source reference link: http://www.themalaysianinsider.com/mobile/malaysia/article/10-20pc-increase-in-house-prices-healthy-says-donald-lim/
Lim said the government wanted to ensure healthy growth in the property market which would give better returns than money parked in fixed deposit accounts.
The Malaysian Insider
KUALA LUMPUR, April 3 — Malaysia is not experiencing a property bubble and price increases of up to 20 per cent per year is acceptable, said Deputy Finance Minister Datuk Donald Lim today.
This comes as increasing numbers of Malaysians, especially city dwellers, have become concerned over the affordability of housing.
Lim said the government wanted to ensure healthy growth in the property market which would give better returns than money parked in fixed deposit accounts.
“An average increase in house prices of 10-15 per cent per annum is healthy as compared to fixed deposits in the bank,” Lim said in a press conference today. “For areas like KL, a 20 per cent increase is quite acceptable.”
When asked whether such a high annual increase in property prices is out of sync with annual income increases in the general population, Lim said that KL is still cheap compared to some of its Asean neighbours.
“We know at the moment that prices are low compared to Thailand and Singapore,” he said. “We are talking about the coming three to five years (for house price increases) after which there is a stabilising period.”
Lim said that the government was monitoring the situation and had taken pro-active steps to avoid a sub-prime crisis from happening in Malaysia.
“We will intervene when we find the figure (for property) has shot up too high,” he said.
He said, however, that one of the measures introduced last year to combat rampant property speculation — the increase of the real property gains tax (RPGT) from five to 10 per cent for houses sold within two years — had not met with stiff resistance.
“A lot of people find it (the increase in RPGT) reasonable,” he said.
Property prices in urban areas such as Penang and Kuala Lumpur rose by up to 40 per cent in 2010 fuelled by low interest rates and a surge in speculative buying, although prices grew slower last year due to dampened sentiment from tightening measures such as a hike in the real property gains tax for early disposals.
Some reports have also estimated that property prices jumped from 5.9 times income in 1989 to 10.9 times in 2010.
The Demographia International Housing Affordability Survey rates markets, whose property prices are 5.1 times median income or more, as “severely unaffordable”.
The House Price Index (HPI), as prepared by the Valuation and Property Services Department, rose 7.5 per cent in the second quarter of last year as compared with the same period in 2010.
For urban centres like KL, to which young working adults are gravitating, the HPI has seen a rapid increase since 2004, growing relatively slowly from 100 in 2000 to 108 in 2003, before rising sharply from 115 in 2004 to 167 in the second quarter of last year.
Lim said in a speech today that the overall HPI has increased 6.6 per cent to 156.9 in the fourth quarter of last year.
He said that the value of All House Price in Malaysia hit RM217,297 in the fourth quarter.
Kuala Lumpur had the highest All House Price at RM487,219 followed by Selangor at RM327,237.
While Asia appeared to have escaped the house price crash that affected the US and parts of Europe, some governments in the region took steps to cool the rapid increase in house prices in an effort to avert a property bubble.
The value of Singapore’s private homes suffered their first quarterly drop in nearly three years following government-imposed measures to cool the property market.
Advance estimates from the Urban Redevelopment Authority (URA) yesterday showed that private home prices fell 0.1 per cent in January-March as compared to the last three months of 2011.
Chinese Premier Wen Jiabao was also reported as saying on March 14 that home prices in the world’s second largest economy were still far too unreasonable and the Chinese government could not relax curbs on the property market as it could result in “chaos”.
Wen also said that reasonable housing prices should reflect personal income, investment and reasonable profits.
----------Vulcan agreed----------
HBA Secretary General Chang Kim Loong said in October last year that the increase of RPGT from five to 10 per cent for houses sold within two years of purchase would be meaningless to short-term speculators looking to flip houses for profit.
He pointed out that properties are typically not allowed to be sold during the construction stage, which takes two to three years, and therefore, raising the RPGT from five to 10 per cent for properties sold within two years would have little impact.
Chang said that under the revised RPGT, speculators could purchase properties from developers during a launch and flip the properties on completion after two years and would have to pay only the same existing five per cent up to the fifth year, after which all profits are not taxable.
----------Vulcan agreed----------
Source reference link: http://www.themalaysianinsider.com/mobile/malaysia/article/10-20pc-increase-in-house-prices-healthy-says-donald-lim/
Lim said the government wanted to ensure healthy growth in the property market which would give better returns than money parked in fixed deposit accounts.
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Eden Ferringhi, Batu Ferringhi Penang MALAYSIA
Double Storey Semi Detach @ Eden Ferringhi for sale.
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Wednesday, March 28, 2012
Singapore Real Estate | Foreign buyers retreat from property market
Friday March 23, 2012
THE hefty new stamp duty imposed late last year seems to have cooled foreign demand for property here.
The share that non-permanent resident (PR) foreigners have of the private housing sector fell by about 10 percentage points this year compared with November — right before the Dec 8 measures kicked in.
In November, foreigners bought 385 units, including new sales, resales and subsales, for a 16% slice of the entire market, excluding executive condominiums (ECs).
But they bought only 53 units in January and 96 units last month, giving them a market share of about 6.5%, according to analysis of Urban Redevelopment Authority data by consultancy Savills Singapore. In 2010, foreign buyers comprised 12% of the market, rising to a record 17% last year. Sales by PRs have held steady at about 13% for both 2010 and last year.
Experts say the 10% additional buyer’s stamp duty applied to all foreign purchases was the main cause of the steep drop.
The measures would have caused a reaction, making foreigners think twice about whether Singapore was still an attractive investment destination.
Ku Swee Yong, chief executive of International Property Advisor, said the frequent shifts in policy could also have dampened demand.
The slew of policy changes over the past two years may have prompted foreigners to opt to rent before deciding on whether they want to buy, he noted.
Some of his Malaysian clients are considering investing in commercial space or smaller homes with lower overall prices, to completely avoid the duty or pay a smaller fee.
Ku expects foreign demand to be subdued for the rest of this year.
Tan Kok Keong, OrangeTee’s research and consultancy head, also noted that with no major bad news between November and last month, the additional stamp duty was clearly the main cause.
Some experts say the drop might be a temporary lull as foreign buyers take time to get used to the idea of the higher tax.
Alan Cheong, director of research and consultancy at Savills, believes foreign demand will inch up over time.
“Foreign buyers at the moment may baulk at the extra 10% premium, but once they see this as the new norm, they may merely treat the additional buyer’s stamp duty as sort of a ‘cover charge’ for parking their funds in a safe haven,” he added.
OrangeTee’s Tan said foreign buyers could creep back in the second half of the year but they are unlikely to match the figures seen before the measures.
Chinese buyers made up about 28% of all foreign purchases — by PRs and foreigners — last year, bypassing Malaysians, the traditional leaders. Tighter home-buying policies in China, such as restrictions on residents in major cities buying a second or third home, prompted more Chinese to look further afield.
Despite the dip in foreign demand, home sales remained strong in the first two months of the year as Singaporean buyers continued to power the market. Last month, a record 3,138 homes, including ECs, were sold as buyers flocked to mass market projects with affordable, small-sized units. — The Straits Times / Asia News Network
Source reference link: http://thestar.com.my/news/story.asp?file=/2012/3/23/asia/10969572&sec=asia
Back to Main Page: www.VulcanInternational.blogspot.com
THE hefty new stamp duty imposed late last year seems to have cooled foreign demand for property here.
The share that non-permanent resident (PR) foreigners have of the private housing sector fell by about 10 percentage points this year compared with November — right before the Dec 8 measures kicked in.
In November, foreigners bought 385 units, including new sales, resales and subsales, for a 16% slice of the entire market, excluding executive condominiums (ECs).
But they bought only 53 units in January and 96 units last month, giving them a market share of about 6.5%, according to analysis of Urban Redevelopment Authority data by consultancy Savills Singapore. In 2010, foreign buyers comprised 12% of the market, rising to a record 17% last year. Sales by PRs have held steady at about 13% for both 2010 and last year.
Experts say the 10% additional buyer’s stamp duty applied to all foreign purchases was the main cause of the steep drop.
The measures would have caused a reaction, making foreigners think twice about whether Singapore was still an attractive investment destination.
Ku Swee Yong, chief executive of International Property Advisor, said the frequent shifts in policy could also have dampened demand.
The slew of policy changes over the past two years may have prompted foreigners to opt to rent before deciding on whether they want to buy, he noted.
Some of his Malaysian clients are considering investing in commercial space or smaller homes with lower overall prices, to completely avoid the duty or pay a smaller fee.
Ku expects foreign demand to be subdued for the rest of this year.
Tan Kok Keong, OrangeTee’s research and consultancy head, also noted that with no major bad news between November and last month, the additional stamp duty was clearly the main cause.
Some experts say the drop might be a temporary lull as foreign buyers take time to get used to the idea of the higher tax.
Alan Cheong, director of research and consultancy at Savills, believes foreign demand will inch up over time.
“Foreign buyers at the moment may baulk at the extra 10% premium, but once they see this as the new norm, they may merely treat the additional buyer’s stamp duty as sort of a ‘cover charge’ for parking their funds in a safe haven,” he added.
OrangeTee’s Tan said foreign buyers could creep back in the second half of the year but they are unlikely to match the figures seen before the measures.
Chinese buyers made up about 28% of all foreign purchases — by PRs and foreigners — last year, bypassing Malaysians, the traditional leaders. Tighter home-buying policies in China, such as restrictions on residents in major cities buying a second or third home, prompted more Chinese to look further afield.
Despite the dip in foreign demand, home sales remained strong in the first two months of the year as Singaporean buyers continued to power the market. Last month, a record 3,138 homes, including ECs, were sold as buyers flocked to mass market projects with affordable, small-sized units. — The Straits Times / Asia News Network
Source reference link: http://thestar.com.my/news/story.asp?file=/2012/3/23/asia/10969572&sec=asia
Back to Main Page: www.VulcanInternational.blogspot.com
UNESCO Penang | Penang City | Heritage at a crossroads
Tuesday March 27, 2012
By JUDY CHENG-Hopkins
IN THE 1980s, when I’d go home to Penang once a year for the holidays, I would always visit my old amah, who was retired and ran her kongsi on Love Lane.
She would ask me in her characteristic, deadpan manner, “What are all these scruffy white people doing in my neighbourhood?”
This was obviously the start of the budget backpacker onslaught into that part of town and well-heeled Penangites began to avoid if they could.
Fast forward to 2012. The article “Skyrocketting Shophouses” by Johnni Wong in MetroBiz on March 21 says it all.
It may sound really strange and inexplicable that people would pay RM3mil to buy three derelict shophouses on Rope Walk and do it up with another RM10mil, but this phenomenon of young or not-so-young professionals moving back to “old towns” is actually quite common in many cities in Europe and even in the hutongs in old neighborhoods in Beijing.
So, as a true daughter of Penang, despite having left Malaysia some 40 years ago to work for the United Nations (UN) in Africa, Switzerland, Italy and the US, I feel excited and proud that this phenomenon is happening in good ol’ Penang.
I believe the root cause of this awakening is the fact that Unesco bestowed the honour of World Heritage Site on Penang in 2008. This status is a godsend in many ways.
Firstly, it provides George Town with breathing space and a sort of legal basis to stop the wanton destruction of many of its treasures with deep historical significance reflecting the many waves of migration, and yes, even the different periods of colonisation with its effects, both good and bad, which contributed to the rich and unique heritage of this Straits settlement.
Secondly, it became a wake-up call for Penang’s citizenry, rousing them from a sort of comfortable lull and apathy (chin-chai mentality), to one of cultural and environmental consciousness and pride. “Hey the world recognises us, the world actually sat up and noticed us! Wow we do have something unique to offer the world!”
And, thirdly, it had a spillover effect onto other parts of Penang, raising people’s consciousness on environmental and aesthetic issues ranging from the decrepit and horrible living conditions of the poor in Ayer Itam, for instance, to the overdevelopment of mega-complexes on hills, cliffs and beaches in Batu Ferringhi.
I do not want to be misunderstood. I am not against developers or development. We do not need to live in the past.
We do not have to romanticise the past to the point that time stands still nor, as a friend of mine put it referring to overzealous heritage types, should we “live like folks in the 18th century!”
Penang’s citizenry have the gift, and a reputation, of sometimes being overly frugal, but, at the same time, they are generous, enterprising and savvy.
Surely the heritage types and developers can rise above their differences to recognise the comparative advantages Penang has — a unique heritage history, the best food in the world, rich cultural diversity and beautiful hills and beaches.
Instead of an antagonistic relationship, developers and conservationists should have a grand alliance, exploiting our comparative advantages for the sake of the prosperity of our citizens through more and better tourism products.
Although Penang has been successful in attracting foreign direct investment and the creation of manufacturing jobs, we may no longer have the comparative advantage of cheap, quality labour with competition from the Indonesias, Vietnams and Myanmars of this world.
Tourism, on the other hand, will only grow as more countries become developed and rich and choose leisure and wanderlust over labour.
Sometimes tourism can wreak havoc on a country by affecting local mores. But quality tourism, the kind that comes from well-educated, history- and culture-loving tourists who can afford to spend more than a few days exploring the cultural wealth of a country, can prove to be a wonderful engine of growth.
But you need something to attract these quality tourists — and we have it all in Penang!
Four years after the Unesco recognition, we are, I believe, at a crossroads, one that will be painfully clear in hindsight.
We may find out too late that we took the wrong course. Penangites, we have a choice — we can have a bustling, prosperous planned city, with architecturally aesthetic buildings and charming heritage quarters or we can have a haphazardly put-together city, with a lot of the charm of its heritage replaced by random buildings, incongruously placed here and there.
In the Penang Heritage Trust, we have a group of dedicated, brilliant historians, culture experts and conservation activists.
Georgetown has an organisational structure dedicated to conservation matters.
We now need an umbrella organisation to bring together all stakeholders — conservationists, developers, businesses, the diaspora and interested citizens to create a sustained heritage movement for a good 10 years when it will hopefully put itself out of business because there will no longer be a need for such an organisation.
Picture: Judy Cheng-Hopkins is the UN Assistant Secretary-General for Peacebuilding Support and has over 30 years experience in key UN organisations.
Source reference link: http://thestar.com.my/metro/story.asp?file=/2012/3/27/north/10991976&sec=north
By JUDY CHENG-Hopkins
IN THE 1980s, when I’d go home to Penang once a year for the holidays, I would always visit my old amah, who was retired and ran her kongsi on Love Lane.
She would ask me in her characteristic, deadpan manner, “What are all these scruffy white people doing in my neighbourhood?”
This was obviously the start of the budget backpacker onslaught into that part of town and well-heeled Penangites began to avoid if they could.
Fast forward to 2012. The article “Skyrocketting Shophouses” by Johnni Wong in MetroBiz on March 21 says it all.
It may sound really strange and inexplicable that people would pay RM3mil to buy three derelict shophouses on Rope Walk and do it up with another RM10mil, but this phenomenon of young or not-so-young professionals moving back to “old towns” is actually quite common in many cities in Europe and even in the hutongs in old neighborhoods in Beijing.
So, as a true daughter of Penang, despite having left Malaysia some 40 years ago to work for the United Nations (UN) in Africa, Switzerland, Italy and the US, I feel excited and proud that this phenomenon is happening in good ol’ Penang.
I believe the root cause of this awakening is the fact that Unesco bestowed the honour of World Heritage Site on Penang in 2008. This status is a godsend in many ways.
Firstly, it provides George Town with breathing space and a sort of legal basis to stop the wanton destruction of many of its treasures with deep historical significance reflecting the many waves of migration, and yes, even the different periods of colonisation with its effects, both good and bad, which contributed to the rich and unique heritage of this Straits settlement.
Secondly, it became a wake-up call for Penang’s citizenry, rousing them from a sort of comfortable lull and apathy (chin-chai mentality), to one of cultural and environmental consciousness and pride. “Hey the world recognises us, the world actually sat up and noticed us! Wow we do have something unique to offer the world!”
And, thirdly, it had a spillover effect onto other parts of Penang, raising people’s consciousness on environmental and aesthetic issues ranging from the decrepit and horrible living conditions of the poor in Ayer Itam, for instance, to the overdevelopment of mega-complexes on hills, cliffs and beaches in Batu Ferringhi.
I do not want to be misunderstood. I am not against developers or development. We do not need to live in the past.
We do not have to romanticise the past to the point that time stands still nor, as a friend of mine put it referring to overzealous heritage types, should we “live like folks in the 18th century!”
Penang’s citizenry have the gift, and a reputation, of sometimes being overly frugal, but, at the same time, they are generous, enterprising and savvy.
Surely the heritage types and developers can rise above their differences to recognise the comparative advantages Penang has — a unique heritage history, the best food in the world, rich cultural diversity and beautiful hills and beaches.
Instead of an antagonistic relationship, developers and conservationists should have a grand alliance, exploiting our comparative advantages for the sake of the prosperity of our citizens through more and better tourism products.
Although Penang has been successful in attracting foreign direct investment and the creation of manufacturing jobs, we may no longer have the comparative advantage of cheap, quality labour with competition from the Indonesias, Vietnams and Myanmars of this world.
Tourism, on the other hand, will only grow as more countries become developed and rich and choose leisure and wanderlust over labour.
Sometimes tourism can wreak havoc on a country by affecting local mores. But quality tourism, the kind that comes from well-educated, history- and culture-loving tourists who can afford to spend more than a few days exploring the cultural wealth of a country, can prove to be a wonderful engine of growth.
But you need something to attract these quality tourists — and we have it all in Penang!
Four years after the Unesco recognition, we are, I believe, at a crossroads, one that will be painfully clear in hindsight.
We may find out too late that we took the wrong course. Penangites, we have a choice — we can have a bustling, prosperous planned city, with architecturally aesthetic buildings and charming heritage quarters or we can have a haphazardly put-together city, with a lot of the charm of its heritage replaced by random buildings, incongruously placed here and there.
In the Penang Heritage Trust, we have a group of dedicated, brilliant historians, culture experts and conservation activists.
Georgetown has an organisational structure dedicated to conservation matters.
We now need an umbrella organisation to bring together all stakeholders — conservationists, developers, businesses, the diaspora and interested citizens to create a sustained heritage movement for a good 10 years when it will hopefully put itself out of business because there will no longer be a need for such an organisation.
Picture: Judy Cheng-Hopkins is the UN Assistant Secretary-General for Peacebuilding Support and has over 30 years experience in key UN organisations.
Source reference link: http://thestar.com.my/metro/story.asp?file=/2012/3/27/north/10991976&sec=north
Back to Main Page: www.VulcanInternational.blogspot.com
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