SLIGHT ADJUSTMENT: Photo shows (from left) Siti, Sim, Lau and Noelle during the press conference. Sim says there could be a ‘slight adjustment’ to the cost of property development due to higher cost of building materials during the implementation of the GST period. — Photo by Lee Hui Joo
KUCHING: Sarawak Housing and Real Estate Developers’ Association (Sheda) foresees that the state’s property market could see a mixed outlook next year due to several ongoing initiatives waiting for implementation by the government to cool down the property market amid rising property prices.
These include the 30 per cent of Real Property Gains Tax (RPGT) for properties disposed within three years, 20 per cent for properties disposed within four years, 15 per cent for properties disposed within five years; as well as the removal of the Developers Interest Bearing Scheme (DIBS) on property sales by property developers.
Sheda secretary general Sim Khiang Chiok believes these measures being implemented would reduce the supply of properties for the secondary market, thus causing prices in the secondary market to go up.
“There could be a shortage of supply for properties in the secondary market (due to the measures that is going to be implemented by the government).
“As a result, prices for properties in the secondary market could potentially go up while demand for properties remains consistent,” he told reporters on the sideline of a seminar by Sheda in partnership with The Royal Malaysian Customs Department at a hotel here yesterday.
Sim highlighted this during the seminar organised by Sheda in collarboration with The Royal Malaysian Customs to brief industry players on the implementation of the GST.
As for residential properties, he believes that there is still healthy growth given that there is about two per cent of population increase in Sarawak every year, urbanisation and the migration of people from rural areas to town and city in search for employment opportunities which could sustain the demand for residential properties.
Sim is optimistic that demand for properties in the primary market next year will continue to grow and provide support to the growth momentum of the property market in the near term.
He noted that the situation is unavoidable given that the GST will cause prices of the building materials to increase slightly adding that some of the costs could be borne by property developers while not ruling that it might be pass on to property buyers.
“There could be a slight increase for the cost of property development (during GST). “However, the prices of the properties will depend on the location and other factors such as desirability, accessibility, facilities available at the property development and so on,” he said.
Sim highlighted this during the seminar organised by Sheda in collarboration with The Royal Malaysian Customs to brief industry players on the implementation of the GST.
He added the seminar was to prepare industry players and to equip themselves with the various administrative guidelines and understanding of the GST when it comes into force in April 1, 2015.
Also present at the event were The Royal Malaysian Customs GST Unit assistant director Siti Zaleha Osman, The Royal Malaysian Customs assistant director Lau Thye Mun, Kuching head of customs Noelle Lily Morse, Sheda members, contractors and real estate agents who made up more than 300 guests at the event.