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BUDGET 2022: Help strugglling homeowners keep their homes

Published: Friday, 15 October 2021

The government should help struggling homeowners keep their homes when the moratorium ends by granting income tax reduction on interest accrued on house loans, says PropertyGuru Malaysia.

Apart from assisting first-time homeowners, the firm said there is a need to help individuals who are battling to keep their houses during the pandemic.

These are some of the items on PropertyGuru Malaysia's wishlist for Budget 2022 to help the property sector recover and expand.

Budget 2022, according to the firm, should be geared at making homeownership accessible to the B40 and M40 categories.

The firm hoped that more can be done for people in the 'sandwich' category between the B40 and M40 groups.

PropertyGuru hoped that Budget 2022 will include a slew of 'goodies' to help individuals who are forced to sell their houses during this difficult period.

This includes extending the exemption of the real property gains tax (RPGT) on residential homes next year or lowering the tax, while Malaysians and the property market are still recovering.

"The extension would help alleviate the struggles of homeowners, otherwise the RPGT may be an additional burden on households who have been forced to sell their home as a means to survive," it said.

The firm believes that the government's approach will help to revive the property market by encouraging the purchase and sale of residential properties.

"While it is important for Budget 2022 to address the current challenges faced by Malaysians and the property sector, we should not lose sight of the equally important long-term agenda of promoting sustainable urban living," it said.

More incentives are needed, according to the firm, to encourage developers to use accredited green certification tools during the construction and operation phases of development projects, such as the Green Building Index (GBI) and the Malaysian Carbon Reduction and Environmental Sustainability Tool (MyCREST).

It suggested that the government provide additional tax benefits to green-certified buildings, such as income tax credits equal to the additional capital expenditure required to get a green certification.

According to the findings of PropertyGuru's Consumer Sentiment Study H2 2021, more than nine out of 10 Malaysians believe it is crucial to living sustainably.

It showed that 71 per cent of Malaysians think developers must utilise sustainable materials.

However, because green building costs are often greater than regular building costs, even if the disparities are offset in the long term, potential homebuyers may be hesitant to make the purchase.

As a result, the government may propose exempting stamp duty for purchasers who acquire green-certified residences to boost demand, the firm said.

Meanwhile, more than four out of five Malaysians plan to buy a home in the future, according to the report, but high property prices are a big disincentive for home buyers.

Despite the government's efforts to provide relief to Malaysian property owners and support the property sector, according to the firm, 84 percent of Malaysians believe the government can do more to make housing more affordable, and 58 percent want the government to extend the Home Ownership Campaign (HOC) to subsale properties.

According to the report, the HOC has assisted many first-time homebuyers in purchasing a home in recent years and has been successful in boosting activity in the stagnant real estate market.

"We hope that the government will not only extend the HOC to next year but also extend the incentives offered under the campaign to the secondary residential market. Based on our recent analysis, the secondary residential property market has been growing steadily over the past few years," the firm said.

Despite the pandemic's influence on the overall number of property transactions, it has boosted the popularity of subsale deals in 2020 and now in 2021, according to the report.

If the HOC is extended to the secondary market, it will provide the housing market a major boost and encourage more first-time homebuyers to consider subsale properties, especially because the stamp duty exemption can assist lower the upfront cost of property purchases, it said.

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