Budget 2023: HBA’s concern and suggestions

• In comparing the revised budget and the previous October budget, the honorary secretary-general of HBA Datuk Chang Kim Loong has expressed the association’s support, concern and disappointment on matters relating to the Malaysian property sector.

KUALA LUMPUR (Feb 24): The National House Buyers Association (HBA) acknowledges the challenges faced by the Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim in the tabling of the revamped Budget 2023, in view of the post Covid-19 pandemic affecting the global and regional economies as well as the financial health of Malaysia.

In comparing the revised budget and the previous October budget, the honorary secretary-general of HBA Datuk Chang Kim Loong has expressed the association’s support, concern and disappointment on matters relating to the Malaysian property sector.

RM10 stamp duty for property transfer among family members

Chang said HBA is disappointed that the proposed incentive of a nominal stamp duty for transactions on transfer of real property between immediate family members has been not been made a reality.

“In fact, this will alleviate the burden on the parents having to bear stamp duties which can be saved for other purposes,” he said.

Even though there is now full exemption on the first RM1 million and 50% exemption on the balance of the property value, Chang opines that this still poses unnecessary burdens on homeowners.

“For instance, a parent who wants to transfer an old property in Bangsar [Kuala Lumpur], which could now be valued at RM2.5 million, would still have to pay as much as RM30,000 on stamp duty!” says Chang.

(RM1.5 million x 4% stamp duty = RM60,000

RM60,000 x 50% = RM30,000)

“We hope the Government will take heed of this proposal by revisiting the request for nominal stamp duty of RM10 on transfers within family members,” he adds.

People’s Housing Projects

Anwar announced an allocation of RM50 million to ensure a safe condition in People’s Housing Projects (PPR) and RM367million have been allocated to build new PPR homes that will benefit 12,400 new residents.

“HBA is of the opinion that PPRs should remain as transit homes for rental and not for sale or ownership,” Chang said.

He said that PPR units built are only temporary living quarters for those looking to, in future, to buy their own houses and they should only be rented out by the relevant agencies.

“The objective and aspiration of the government is for these transit homes to provide a temporary living place for those who want to save enough money before embarking on buying their own homes.

“The PPR residents should not regard the flats as their permanent homes but merely temporary abodes to shelter their families and have roofs over their heads while they endeavour to look for permanent homes,” he said.

Chang noted that PPR flat tenants are supposed to self-occupy until they improve their economic standings and move out, and allow those on the “waiting list” to take over possession of their units. Those who flout the rules by subletting their units for obvious gains should be evicted and enforcement should be meted without delay.

“HBA has been calling for stricter enforcements of existing rules to ensure that low- cost housing and PPR flats are not rented out to third parties and are allocated to the correct target groups,” he said.

Chang suggested that the tenants to go through a process of “means testing” – the process of measuring the income level of a person in order to decide if they qualify for PPR “handouts”.

“These social benefits and welfare offered to PPR tenants should be reviewed every three years by a committee within the agencies so that the tenants do not overstay but should gradually allow those incoming target families to take up occupation,” he suggested.

Housing Credit Guarantee Scheme

HBA welcomes the announcement of the RM5 billion allocation for the Housing Credit Guarantee Scheme (SJKP) to guarantee housing loans to help those without stable incomes – such as those in the gig economy, to buy properties. 

“The gig economy has been a life saver to many of the rakyat who lost their jobs and resorted to becoming ride-hailing drivers, food-delivery riders and other forms of freelance work,” Chang said.  

He said these employees are still economically productive and as such, should have access to financing to buy assets such as property.

However, he said, HBA hopes this SJKP will be limited to only first-time house buyers and affordable properties.

“It should also be made available for purchase of secondary properties (i.e. completed properties), not just primary properties directly from developers,” Chang added.