HOC sales to take a hit despite positive outlook

by FARA AISYAH / pic by MUHD AMIN NAHARUL

SALES under the latest Home Ownership Campaign (HOC) are expected to take a hit this year, trailing a dismal first-half (1H20) market performance in 2020.

The first few months of the government-backed campaign which launched in June recorded sales worth RM816 million from RM55 billion projects registered for the new season, according to the Real Estate and Housing Developers’ Association Malaysia (Rehda).

Its president Datuk Soam Heng Choon (picture) said the association does not expect HOC sales to reach levels achieved under the previous campaign, despite hopes of a more positive outlook next year.

“We started selling HOC projects in August when the gazette came out, so we are only in the first month now.

“We hope sales will pick up in the coming months in tandem with economic recovery, but we expect more sales to be transacted in 1H21,” he told reporters at the HOC-Malaysia Property Expo (HOC-Mapex) October 2020 media conference yesterday.

The latest HOC figure is equivalent to only 2% of the sales recorded in 2019. It includes 587 projects from 437 developers which have been processed to date. Last year, Rehda reported sales worth RM37 billion comprising 57,000 units during the June-May HOC period.

“Those are the sales that we have certified, the real sales could be more than that. More project registrations and sales are still coming in,” VP Datuk NK Tong said.

“Certification will take a while because there is a backlog. Once developers sign a sale and purchase agreement, they will submit it for certification. The Rehda branches will double check and certify the figure, only then will it be recorded as sales,” he added.

According to National Property Information Centre data, property transaction volume for 1H20 fell by 27.9% year-on-year to 115,476, while transaction value plunged 31.5% to RM46.94 billion.

Soam expects sales to further improve in 1H21 in line with the projected recovery of the economy, the support from the campaign and the low interest-rate environment.

The government announced the short-term National Economic Recovery Plan earlier this year to help cushion the impact of the Covid-19 pandemic.

The plan includes measures to uplift the struggling property market such as the reintroduction of HOC, Real Estate Property Gains Tax exemption for disposal of up to three properties and the removal of 70% loan-to-value margin for the third residential properties.

Under the new HOC period — from June 2020 to May 2021 — a stamp duty exemption will be given to the first RM1 million of a property’s value on the memorandum of transfer for properties priced from RM300,000 to RM2.5 million. It will also include a 100% stamp duty exemption for the financing agreement.

The HOC-Mapex expo, which will be held this weekend, will be joined by 25 reputable developers with properties located across the peninsula.

Three financial institutions, namely RHB Bank Bhd, Public Bank Bhd and United Overseas Bank (M) Bhd will be present at the three-day event, while Malayan Banking Bhd remains the official HOC-Mapex financial partner this year.

The event is also supported by various government agencies including the Credit Counselling and Debt Management Agency, National Housing Department and Housing and Strata Management Tribunal among others.