HOC in Hong Kong could clear premium property overhang, says minister

It is to curb abandonment as the properties would end up an eyesore to the public and would be detrimental to the country’s image


THE government’s proposal to bring Home Ownership Campaign (HOC) to Hong Kong and China is envisioned to clear the current property overhang that has been plaguing the market for the past few years.

Housing and Local Government (KPKT) Minister Zuraida Kamaruddin (picture) said the initiative is made to particularly clear the more premium properties that are valued at more than RM1 million per unit.

She said the option is to curb abandonment as the properties would end up an eyesore to the public and would be detrimental to the country’s image.

“We are only talking about houses that are in the RM1 million and above bracket. It would be very bad for the country’s image to have empty buildings everywhere.

“I’m sure you wouldn’t want people to see this country as a place of dilapidated and empty houses,” she told a media conference at the soft launch of the Seventh Asia-Pacific Urban Forum (APUF7) in Putrajaya yesterday.

Currently, the premium segment comprises 4,331 unsold residential units valued at RM8.74 billion, according to the Valuation and Property Services Department first-quarter 2019 (1Q19) market report.

The value makes up half of the total RM19.96 billion overhang houses reported in the quarter, up 0.5% compared to 1Q18.

Zuraida said the government could not just tell or demand the developers to give hefty discounts to make it possible for locals to own such homes.

“If I ask developers to reduce the price to RM200,000, it would be impossible,” she said.

Zuraida was earlier criticised by certain quarters after she suggested developers to woo more Hong Kong and Chinese investors to buy unsold premium market homes in the country under the existing Malaysia My Second Home (MM2H) programme.

MM2H, under the Culture, Arts and Tourism Ministry, is an initiative that allows foreigners to stay in Malaysia on a multiple entry social visit pass for a period of ten years, a term that is also renewable.

According to the ministry’s official website, 42,271 approved participants were recorded between 2002 and 2018 in the MM2H scheme.

The HOC, spearheaded by KPKT, began in January. It is aimed at increasing homeownership among Malaysians, especially among the B40 (Bottom 40%) income group, and clearing up the overhang that was reported worth RM19.86 billion in 2018.

Zuraida said the announcement that she made on Wednesday was a result of her earlier visit to Hong Kong and China.

She said the proposal to bring HOC to Hong Kong would also cater to buyers from other countries who wish to purchase houses in Malaysia.

“We are riding on the existing MM2H programme. It has also been applied by other citizens. The mechanism and regulation aspects of this HOC will be ironed out later,” Zuraida added.

Meanwhile, Zuraida said Malaysia is expected to host the APUF7 between Oct 15 and Oct 17 this year in Penang.

The forum is expected to address four topics — namely urban and territorial planning, urban resilience, data and technologies for smart cities, and urban finance.

“We are also organising the Local Government Convention at the event to provide the city and local government councillors and their staff with knowledge exchange among the AsiaPacific representatives,” she said.

Zuraida said it is the first time for Malaysia to host APUF, which is also aimed at getting 7,000 participants from 60 Asia-Pacific countries.

The event is expected to be officiated by Prime Minister Tun Dr Mahathir Mohamad.