PEPS hopes for Budget 2024 to promote rent-to-own scheme

• It added that this RTO scheme shall also be applicable to PRIMA homes, where there is an oversupply, as this will give an opportunity for the B40 income group to own homes for the first time.

KUALA LUMPUR (Oct 10): Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia (PEPS) proposed that the government to promote rent-to-own (RTO) scheme as part of its wishlist for the upcoming Budget 2024

In a statement issued on Tuesday, the association noted that with the stagnant economy and the increase of overnight policy rate (OPR) rates resulting in the increase in housing loan interest, many Malaysians will still be unable to afford to buy a house.

“PEPS Wishlist is for Bank Negara to provide a revolving fund to the commercial banks to work with developers to purchase unsold house units at a discount and for the commercial banks to finance the home buyer for a period of five years and at the end of the 5th year, for the tenant to exercise the option to purchase the house at a predetermined price,” PEPS noted in the statement.

It added that this RTO scheme shall also be applicable to PRIMA homes, where there is an oversupply, as this will give an opportunity for the B40 (Bottom 40%) income group to own homes for the first time.

The association also highlighted that the property industry is compounded with many complex problems such as oversupply, particularly in the office, retail and service apartment sectors, labour shortages, increasing material costs and high compliance costs.

Some of the other key proposals that PEPS have suggested have touched upon the topics of affordable housing, industrialised building system (IBS) and assisting the ageing population.

Addressing the issue of affordable housing, PEPS proposed the state government and its agencies and government linked companies to joint develop their surplus land with private developers; to set up a unit within the Ministry of Housing to purchase unsold affordable housing units and resold it to private companies for their staffs or for RTO scheme for B40.

For IBS, PEPS wished for the government to extend investment incentives to property developers who have adopted the IBS system to promote the adoption of the IBS system. To note, incentives were only given to manufacturers of IBS building components and none to IBS players. 

In a bid to reduce property overhang, PEPS wishlist to curb the issues are to review the condition of Malaysia My Second Home programme; encourage developers to lease unsold units to tenants under RTO and selling the units after five years at a pre-agreed price; and to provide RM25,000 one-off grant as initial deposit for first-time homebuyers.

With only a small number of senior house accommodation with aged care facilities, the association wished for the government to assist developers involved in senior living to provide grants for construction, depreciation allowance on capital expenditure and tax relief in the first 10 years of operation. 

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