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PROPERTY SECTOR
My First Home Scheme launched
• It was reported in the media today that a scheme ‘My First Home Scheme’ has been launched officially by the Prime Minister. Recall that this scheme was announced during the
Budget 2011 in October.
• This scheme would enable young working adults - whose salary are less than RM3,000/month – to obtain up to 100% financing to buy their first home costing between
RM100,000-RM220,000 with a repayment period of up to 30 years.
• Basically, Cagamas Bhd will bear the costs of the initial 10% deposit for the house while normal interest or profit rates for Islamic banks apply under the scheme.
• The scheme would see the participation of 25 conventional and Islamic financial institutions including AmBank, CIMB, Hong Leong, Maybank, Public Bank, RHB and Standard
Chartered.
• We understand that to qualify for the scheme, house buyers must be those working in the private sector and are confirmed employees with a minimum of six months in the job.
• Further to that, the monthly financing repayment sum must also be not more than one-third of the applicants’ monthly gross income.
• While this is positive as this should encourage stronger transaction volume in the market, we see a marginal impact on the listed property companies given that they do not have
exposures in residential properties within the RM100,000-RM220,000 range.
• We maintain our OVERWEIGHT stance on the property sector with SP Setia (FV:RM7.38) as our top pick as we are bullish that the group would be generate new sales of at least RM3bil – a record high. New sales would be underpinned by two key commercial projects, KL Eco City (GDV:RM6bil) and Setia City (GDV:RM5bil-6bil), apart from its bread and butter
residential projects.
• We also have BUYs on IJM Land, Ivory Properties, Axis REIT and CapitaMall Malaysia Trust. We have a HOLD for Bandar Raya Developments, Sunway City, Glomac and IGB Corp while
Hektar REIT is under review.
