The Government has put in place for the first time legal, financial and tax support for the residential property sector to benefit buyers-to-be, owners and developers in addition to a RM2.2billion allocation to build more affordable housing under different housing programmes.
It has also proposed to formulate the Residential Rental Act to protect the landlord and tenant, a move which underscores its intention to promote the rental market. This is another first for the property sector.
The various measures were lauded by developers, property consultants and agents.
To encourage the construction and ownership of more affordable homes, the government's special step-up financial scheme which was introduced in October 2016 only for PR1MA housing has now been extended to private housing developers, subject to certain criteria.
Under the scheme, the conventional ruling on the maximum loan offered based on salary scale will be relaxed and Employees Provident Fund contributors can opt to withdraw from Account 2 for the PR1MA end-financing scheme.
When the scheme was introduced last year, developers urged the government to extend the scheme to private developers.
The Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector, Malaysia (PEPS) said in a statement: "This is a laudable move by the Government to address the affordable housing issues in terms of financial capacity to buy and also to assist in increasing the supply of affordable homes.
"The step-up financing scheme provided to PR1MA is welcome news" said PEPS budget committee chairman James Wong.
Bina Darulaman Bhd (BDB) also welcomed the government's efforts to extend the step-up financing scheme introduced by PR1MA to developers in the private sector.
"This scheme will help buyers, particularly those struggling to obtain financing for their first property" said its group managing director Datuk Izham Yusoff.
To alleviate the sufferings of house buyers whose projects have been abandoned by developers, effective Jan 1, 2018 to Dec 31, 2020, there will be an exemption on stamp duty for loan agreements. Letters of consent to transfer will also be given to rescuing contractors and original owners of abandoned projects.
Abandoned housing projects have been an issue for years and many house buyers have been financially burdened because their financial commitments with lenders and banks continue to be binding.
In another first, in a move to boost house ownership, for the first time in 60 years, the Government has proposed a 50% tax exemption on rental income received not exceeding RM2,000 per month. This exemption is effective from the year of assessment of 2018 to 2020.
"This will help to promote the growth of the rental market" said Wong.
Other measures to boost housing includes an allocation of RM200 million for the maintenance and refurbishment of houses, including the set up of a 1Malaysia Maintenance Fund.
Property developer Mah Sing Group managing director Tan Sri Leong Hoy Kum lauded the government's proposal to give a 50% tax exemption on rental income not exceeding RM2,000 per month.
"This would encourage more property investments and help to boost the overall property market. It is good to invest in properties as early as possible and the value appreciates over time" Leong said, adding that the company will continue to focus on building more houses priced below RM500,000.