by FARA AISYAH/ pic by MUHD AMIN NAHARUL
THE government’s decision to waive the Real Property Gains Tax (RPGT) for Malaysians effective this month is expected to boost sentiment during the current challenging market that is very much affected by the Covid-19 pandemic.
CBRE Group Inc and CH Williams Talhar & Wong Sdn Bhd MD Foo Gee Jen said the incentive is akin to the RGPT exemption that was initiated during the post-global financial crisis in 2008, which helped boost the market.
“The RPGT exemption will definitely be able to help stimulate a lot more activities.
“There was a period when the RPGT was waived, but there was no limitation during that time, while the current exemption is only for residential properties,” he told The Malaysian Reserve.
Foo added that the RPGT exemptions in 2008 and 2019 had kicked off the bull run from 2010 to 2014.
As such, he said the reintroduction of the Home Ownership Campaign (HOC) from June 1, 2020, to May 31, 2021, could be another impetus for growth.
“HOC needs to be extended to the secondary market as 65% of total value and volume transacted in the residential market is from the subsale segment.
“We could help the upgraders by extending the HOC to the secondary market,” Foo said.
The incentives under the new HOC — announced by Prime Minister (PM) Tan Sri Muhyiddin Yassin last week under the short-term National Economic Recovery Plan — include stamp-duty exemption on the instruments of transfer and on loan agreements for the purchase of residential homes priced from RM300,000 to RM2.5 million.
The exemption on the instrument of transfer is limited to the first RM1 million of the home purchase price, while full stamp-duty exemption is given on loan agreements for sale and purchase agreements signed between June 1, 2020, and May 31, 2021.
An additional discount from developers of only 10% on the approved purchase price of a property is also offered during the HOC.
Meanwhile, the RPGT exemption is for the disposal of residential properties by Malaysian individuals from June 1, 2020, to Dec 31, 2021, limited to three properties per individual.
An industry expert who declined to be named does not expect the waiver to impact the property market.
“The majority of Malaysians do not have three homes,” he said.
In addition, the PM also said the 70% margin of financing limit for the third housing loan onwards for property valued at RM600,000 and above will be lifted during the nine-month HOC period, subject to the financial institution’s internal risk management.