Astoria Ampang receives many enquiries from foreign buyers but is unable to sell as the units are priced below the RM2m threshold
by FARA AISYAH / pic by RAZAK GHAZALI
LAND & General Bhd (L&G) is calling for a lower price threshold for property purchases by foreign buyers, particularly in Selangor.
Its MD Low Gay Teck (picture) said a lower price threshold for such buyers would help developers in the current soft market and L&G itself secure higher sales.
“We had many enquiries from foreign buyers for Astoria Ampang — which is under the Selangor government’s jurisdiction — but the units are priced below RM2 million, so we cannot sell them to foreigners.
“We secured about 20% of foreign buyers for our completed project The Elements@Ampang, which is next to Astoria Ampang, but it is under the Federal Territory of Kuala Lumpur jurisdiction which allows foreigners to buy properties above the RM1 million threshold,” he told The Malaysian Reserve.
He added that if the price threshold for foreign buyers in Selangor is lower, L&G may sell another 20% of Astoria Ampang, which will make a big difference to its revenue and profits.
The foreign price threshold for properties in Selangor is divided into three zones. For Zone 1 (which covers Petaling, Gombak, Hulu Langat, Sepang, Klang) and Zone 2 (Kuala Selangor, Kuala Langat), the minimum price threshold is set at RM2 million. The minimum threshold for Zone 3 (Hulu Selangor, Sabak Bernam) is lower at RM1 million.
However, for this year only, the state government has reduced the minimum purchase price threshold for strata properties, including strata landed homes to RM1.5 million throughout all zones in the state.
“We hope the state government will look into this and revise the policy because there are very few RM2 million worth of properties in Selangor, particularly for high-rise units.
“There are definitely a lot of room for it to be lowered to below RM1 million,” Low said.
L&G has just handed over the units of Astoria Ampang Phase 1 to the owners which consist mainly of young (28 years old) to middle-aged (45 years old) buyers, he added.
The RM840 million development comprises two phases of four blocks and 1,012 units.
The Phase 1 has achieved a take-up rate of 391 units or 77% out of 506 units to date. Low’s Budget 2021 wishlist as a developer is for the government to look into ways of utilising the Employee Provident Fund (EPF) monthly contribution to service mortgage payments.
Currently, buyers can only access the Account 2 of their EPF to finance the purchase of a house.
“Assuming an individual contributes over 20% of his/her salary for EPF monthly, the amount itself can be used directly to serve the monthly mortgage.
“That would ease up a lot of a buyer’s financial burden with the property prices today being not cheap,” he said.
Low said although many developers, including L&G, recorded good bookings in the post-Movement Control Order period, they are still facing challenges in converting the bookings into actual sales.
He said many buyers are finding it hard to get their loans approved due to either they are not able to secure a loan or get the margin of financing that they want.