30 October, KUALA LUMPUR – New homebuyers could be looking at discounts between 5% to 10% on house prices in the coming months due to the exemption of the Sales and Services Tax (SST) on construction materials.
Finance Minister, Lim Guan Eng however said that this is only applicable to newly launched housing developments and housing units.
This discount will not be applicable to low cost housing projects, as prices for these projects are sold at a controlled price.
“As for discounts on existing units, we will have to wait this Friday when the Budget 2019 is tabled,” he said at a press conference in Parliament.
Lim also thanked the Real Estate and Housing Developers’ Association Malaysia (Rehda) for agreeing to this.
This is partly attributable to 2.5% to 5% of savings for developers after the exemption of the sales and services tax (SST) on basic construction materials and all construction services.
“Together with other discounts and rebates that most developers are currently offering in view of the soft market for new launches, house purchasers can look forward to lower prices of minimum 5% depending on the location and type of product,” said Rehda president Datuk Soam Heng Choon in a statement on Monday.
Lim however expressed his desire to have the discount at 10%.
“I would like to fix it at 10% and we will discuss it further with Rehda,” he said.
Lim has repeatedly asked developers to cut property prices and threatened to review the SST waiver on construction materials if developers refuse to lower property prices.
He also stressed that what the government wants to see is house price reduction and not additional perks such as freebies and rebates by developers.
He also clarified again that he did not say the SST implementation will cause prices to drop as he always stressed that should price increased but the impact would be far lesser than the Good and Services Tax.
The Bagan MP also asserted that the government would reimpose SST on developers who do not lower down their prices after being exempted.
– THE SUN