Highlights of 2016

Highlights of 2016

TRANSPORTATION INFRASTRUCTURE

The RM337 million Bayan Lepas Expressway comprising an elevated structure of 3.2 kilometres and a street-level route of 4.2 kilometres linked to Sultan Abdul Halim Muadzam Shah Bridge (2nd Penang Bridge), was opened to traffic in early April.

Phase 1 of the MRT Sungai Buloh-Kajang is expected to be operational from 16th December 2016, covering 12 stations between Sungai Buloh and Semantan. It is part of the ongoing Klang Valley Mass Rapid Transit (KVMRT) project, which is expected to benefit decentralised office locations along its route.

The governments of Malaysia and Singapore signed an MoU on 19thJuly 2016 setting out how the HighSpeed Rail (HSR) project is to be developed for opening by 2026. The 350km line is expected to reduce travel time between Singapore and KL to 90 minutes.

 

FOREST CITY JOINS DUTY-FREE CLUB

The 1,386-hectare mixed development project spread over four man-made islands by Chinese heavyweight developer, Country Garden, was officially launched by the Sultan of Johor and PMt on 6th March 2016. An entire city designed from scratch, Forest City is set to include extensive green landscaping and to utilize clever design to create a green ‘smart’ city. At the launch, the PM announced that Forest City will be accorded dutyfree status, joining Labuan, Langkawi and Tioman. In addition to that, further tax incentives for green developers, tourism, health and education sectors were bestowed upon Forest City.

 

BREXIT SMEXIT

Many were surprised by the outcome of the June 2016 ‘Brexit’ referendum, whereby British citizens voted to exit the European Union. The referendum roiled global markets, including currencies, causing the British Pound to fall to its lowest level in decades.

How are UK properties performing post-Brexit? According to global real estate services provider, Savills UK, the July to September 2016 period saw a rise in foreign investments. The uncertainty created post announcement, affected property prices, with buyers getting a 5-6% discount on pre-Brexit asking prices. Besides discounts from developers, the significant drop in the value of the Pound has led to an uptick of interest by Asian investors – with the majority coming from China, Hong Kong and Singapore.

HELP FOR HOMEBUYERS                                                                                                                 

The Budget 2017 saw the announcement of several incentives, aimed at boosting home ownership. These include a stamp duty exemption for first-time home buyers who purchase homes costing not more than RM300,000.

Besides that, the government will provide vacant lands at strategic locations to government-linked companies and affordable housing scheme PR1MA to build more than 30,000 homes with the selling price between RM150,000 and RM300,000.

SOHO SQUEEZE

Property developers will have to allocate up to 30% of affordable units for their serviced apartment and boutique office projects, depending on type and location, according to the Selangor Housing and Property Board (LPHS).

Under the new guidelines, effective 1st September 2016, selling prices for affordable serviced apartments and small office home offices (SOHOs), small office versatile offices (SOVOs), or small office flexible offices (SOFOs) are capped at RM270,000 and RM230,0000, respectively.

Applications for these affordable units have to be made through LPHS. Developers will be fined 10% of the selling price if they do not sell affordable commercial apartments/boutique offices to buyers approved by LPHS and an additional 5% will be imposed if the Bumiputera quota is not adhered to.

DEVELOPERS CRY FOR HELP

At the REHDA first half year review held in September, REHDA president Datuk Seri FD Iskandar Mohamed Mansor voiced out that if the Government wants developers to build more affordable housing, they should be given cheaper premiums, if not charged at all.

Datuk Seri FD Iskandar is seeking government cooperation to reduce or waive development charges and other charges, collectively known as compliance costs, in order to bring down prices as this is too challenging for private developers to go it alone, considering today’s high land prices.

 

This article was first published in the iProperty.com Malaysia December 2016 Magazine. Get your copy from selected news stands or view the magazine online for free at www.iproperty.com.my/magazine.Better yet, order a discounted subscription by putting in your details in the form below!

 

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