Rehda: Biggest hurdle for property market is strict lending conditions by banks

 

PETALING JAYA (April 16): The Real Estate and Housing Developers’ Association (Rehda) said the strict conditions imposed by banks on home loan applicants is the biggest hurdle in the property market.

Free Malaysia Today reports that Rehda says the "tight-fisted" bank conditions remained an obstacle, amidst the government's measures to encourage home ownership by waiving stamp duty fees and providing other incentives and discounts as part of the Home Ownership Campaign (HOC) which ends in June.

Rehda president Soam Heng Choon was quoted as saying that banks should gauge an applicant’s ability to repay their loan using aspects of his financial background outside the debt-service ratio.

“A 25-year-old who just started working might not be eligible for a loan but banks must take other factors into consideration such as parental financial support,” Soam said.

“Banks should be more robust at credit profiling."

Rehda has announced that it aims to sell over RM3 billion worth of properties  during the six-month HOC.

Rehda added that as of March 19, incentives for home buyers who buy properties registered under the HOC include stamp duty waiver for loan agreements for properties priced up to RM2.5 million, stamp duty waiver for Memorandum of Transfer (MoT) for properties under RM1 million and a reduction of 1% for properties priced RM 1 million to RM2.5 million to 3% from the current 4%.