Wednesday, April 11, 2012

Malaysia to raise floor prices for foreign home buyers

In an effort to control rapidly increasing home prices, Malaysia is planning to raise the floor prices for residential properties bought by foreigners. As such, Singaporeans who are keen on Malaysian properties may have to think twice.
A report by The Star yesterday revealed that existing guidelines may be revised to raise the existing minimum price of RM500,000 (S$204,667.29) to RM1 million (S$417,000).

The decision is now “in the pipeline” and an announcement will likely be made by Nor Mohamed Yakcop, Minister in the Prime Minister's Department who will lead the Economic Planning Unit, added the report.

Citing a source, The Star also noted that selected growth corridors such as Iskandar Malaysia could feel less of an impact from the proposal, as a lesser minimum threshold will likely apply to foster development in those areas.

The looming increase in floor price for foreign buyers is likely to be a welcome move, especially to young middle-class Malaysians who have been burdened by fast rising home prices, amid slow salary growth.

On the other hand, foreigners have little difficulty with the RM500,000 floor price for homes, as their currencies are usually much stronger.

Although property consultants are aware of the possibility of revised rules, they believe it is still at the proposal stage.

“It's a flyer to check public response. Not all states will agree,” said Kumar Tharmalingam, Chief Executive at Malaysia Property Inc.

Foreign buyers of Malaysian property are mostly from China, Singapore, Japan and South Korea. But they only account for around two percent of the residential market.

View the original article here

Source From Property Guru

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