Budget 2022: Hardly any goodies for the property market

PETALING JAYA (Oct 29): Overall, there is no 'creativity' in Budget 2022 with regards to the property sector, said said KGV International Property Consultants (Johor) Sdn Bhd executive director Samuel Tan (pictured).

Budget 2022 was unveiled by Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz today and it is the nation's largest Budget to date at RM332.1 billion. It is also the first under Prime Minister Datuk Seri Ismail Sabri Yaakob's administration.

Among the measures announced for the property sector include the abolishment of the Real Property Gains Tax (RPGT) for property sales from the sixth year onward and a RM1.5 billion allocation to ensure the continuity of Rumah Mesra Rakyat and other aid schemes for the upkeep of affordable housing projects.

Plus, there will be a RM2 billion allocation under a housing credit guarantee scheme to assist those without a steady income, such as gig economy workers, to buy homes.

"Apart from the abolishment of the RPGT for properties held from the sixth year onwards, there was hardly any good news for the property market. [RPGT abolishment] is a long-awaited measure as many see [RPGT] as an unjust way to penalise long-term property owners based on inflation," Tan told EdgeProp.my

With the abolishment, Tan hoped property owners will be motivated to upgrade to their desired homes without any tax penalty.

"It would be better if the RPGT rates are reduced progressively for transactions of properties below five years to inject some vibrancy to the property market," suggested Tan.

Furthermore, he was anticipating an announcement on the extension of the Home Ownership Campaign (HOC) till at least June 2022. "This is disappointing to many potential homebuyers hoping to purchase their dream homes, now that the pandemic is better controlled. I hope during the Budget debate stage, [the extension] could be announced," noted Tan.

Meanwhile, he lauded the move to ensure loan accessibility for those without fixed income and RM1.5 billion allocation for affordable housing -- welcoming moves to ensure greater homeownership. 

"The effectiveness of the RM1.5 billion allocation depends on many other factors such as location and quality of such affordable housing. In other words, implementation is the key. It is time to take stock of the effectiveness of such a policy by looking at the occupancy rate of affordable housing.

"As for the RM2 billion housing credit guarantee, it will really help those from the gig economy to own a house, especially first-time homebuyers. Still, there is a need to scrutinise the details such as percentage of loan guarantee, property price cap and etcetera. Once again, implementation is key to ensure the success of this scheme," stressed Tan.

As for the Johor property market, Tan hoped that the RPGT will spur some upgrading and restructuring of property ownership in the state.

"Johor’s property market will depend vastly on the opening of the international borders so that our local economy can grow. This will spur organic growth which will impact the property market favourably," said Tan.

Get the latest news @ www.EdgeProp.my

Subscribe to our Telegram channel for the latest stories and updates 

Click here for more property stories