PETALING JAYA: Various
stakeholders in the property sector hold divergent views on the new set of
guidelines governing property purchases by foreigners in Selangor, with some
believing it will prevent them from sweeping up properties and driving up prices.
National
House Buyers Association secretary-general Chang Kim Loong applauded the state
government's move to set a minimum purchase price of RM1mil for the Hulu
Selangor and Sabak Bernam districts (Zone 3) and RM2mil elsewhere (Zones 1 and
2).
According
to an Aug 28 circular, the guidelines, effective Sept 1, apply to foreigners,
permanent resident holders and foreign companies.
It
added that the land office also only permits these groups to buy strata and
landed strata properties.
Chang
said this rule would prevent foreigners from grabbing up properties, using
their superior exchange rate, which would result in increased prices and
depriving Malaysians the opportunity to own such properties.
"Take,
for example, the Singapore dollar against the ringgit. It's peanuts to them," he told StarBiz, urging other
state governments, especially Penang and Johor, to follow Selangor's footsteps
to stop the steep rise in property prices.
Chang
said Kuala Lumpur City Hall should also increase the minimum threshold to
RM2mil, as RM1mil was considered a basic level entry price of a new property
with a Kuala Lumpur address.
Meanwhile,
the Real Estate and Housing Developers' Association Malaysia opined that the
new set of guidelines would not have much impact because the total number of
foreign buyers here was minimal.
Its
vice-president Sivanyanam Sinnathamby said that according to statistics from
Malaysian Properties Inc, the number of foreign buyers on a national basis
stood at a mere 4% to 7%.
"The
number of foreign buyers in Selangor is even smaller. In short, the Selangor
state authorities are making rules which affect such a small part of the
market," he said.
He
added that foreign buyers were concentrated in Kuala Lumpur, Penang and
Iskandar Malaysia, Johor.
Association
of Valuers, Property Managers, Estate Agents and Property Consultants in the
Private Sector president Siders Sittampalam opined that it was an "overall fair
move", but expected little impact.
He said
Zone 1, which includes the districts of Petaling and Sepang, was the main
attraction for foreigners, but said this number was very small even in these
areas.
He said
that the policy itself was fair in terms of quantum and structure, as prices
had indeed moved up quite a bit in the last several years.
"So,
even with the RM3mil threshold for the commercial and industrial sub-segments,
it is fair. This move is not something that should shake the market,"he said,
adding that it was also fair to limit Malaysia My Second Home participants to
one property.
Property
consultant Khong & Jaafar group of companies managing director Elvin
Fernandez said this was a pre-emptive strike to prevent foreign developers from
Johor from entering Selangor because they had been scouting around Kuala Lumpur
for land.
"This
policy is a deterrent to foreign developers," he said.
Alzac
Viva Sdn Bhd project director Mak Foo Wei agreed, saying this move was to deter
foreign Chinese developers in Johor from operating here.
He said
the move would also protect the locals should property prices go up further,
pointing out that an RM800,000 property might move into a range eligible for
foreigners to purchase had the threshold not been moved up to RM2mil.
However,
Ken Holdings Bhd group managing director Sam Tan said the Selangor market was
very different from Johor's and questioned the need for the new guidelines.
"There
are foreigners who just need a small pad. They don't need to buy a RM2mil
property," he said.
