'Budget 2016 offers little to catalyse property market'

PETALING JAYA: Real estate agents from The Property Expert (TPE) Realty say Budget 2016 offers little to catalyse the property market. “Budget 2016 isn’t doing much for the property market,” said TPE Realty principal Chong Ngee Teng. “We expect next year to be quite slow, and quite similar to this year, because not much has been done to assist the market right now.”

He was speaking at a briefing for TPE Realty agents on theedgeproperty.com at The Edge Communications office in Mutiara Damasara, Selangor, yesterday.

Budget 2016 allocates RM1.6 billion for 175,000 affordable units of PR1MA houses, and RM200 million for a fund that helps first-time homeowners with paying a down payment on a piece of property.

However, the agents’ hoped-for reinstatement of the developer investment bearing scheme (DIBS) and a reduction in real property gains tax (RPGT) have not materialised under Budget 2016.

However, homebuyers might be able to look forward to lower property prices. “We do expect price corrections [from developers] to stabilise the market, as transactions have been on a decline in such a challenging market,” Chong said.

TPE Realty director Fan Yea Jye said agents had generally expected more encouraging policies in Budget 2016 because of the current sluggish market.

“We notice that funds allocated [under Budget 2016] lean towards the administrative side of the market rather than construction works,” said Fan.

“There isn’t anything encouraging in Budget 2016 where the real estate market is concerned except for the PR1MA homes.”

The government has also allocated RM200 million for 10,000 units of Mesra Rakyat houses, which will be subsidised by RM20,000 each. However, Fan makes the distinction between ‘low cost’ and ‘affordable’. “Low-cost houses weren’t mentioned [in Budget 2016]; they aren’t the same as the ‘affordable houses’, as these affordable properties could easily cost up to RM400,000 to RM600,000, which isn’t low-cost by today’s standards,” he noted.

On how property agents can deal with the slower market next year, Fan said high standards of professionalism in dealing with clients would be even more important, because buyers are now able to obtain information and services online.

Towards this end, TPE Realty agents were introduced to the powerful and free research and analytical tools on theedgeproperty.com, a complete property portal for professionals and ordinary buyers and sellers.

The portal aims to integrate the expertise and personal touch offered by agents and negotiators with cutting-edge technology and data via analytics tools such as The Edge Reference Price, and Location Scan.

The site also offers access to the latest news and updates on the market’s overall performance.

“The website is very comprehensive and is a good tool for agents. It’s also useful as all the data provided is complete and informative,” Chong said.

“The website is a great idea; it’s comprehensive and complete,” Fan agreed. “Agents used to have to spend time, effort and money to collect and analyse data, but now with this portal, it can be done with one click.”

This article first appeared in The Edge Property, a pullout that comes free every Friday with The Edge Financial Daily, on Oct 30, 2015. Download this week's and past issues of The Edge Property pullout here for free.