Decision on Property Threshold for Foreigners a Short Term Measure
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The government’s decision to lower the property threshold for foreign property buyers from RM1 million to RM600,000 as announced in the 2020 Budget is a short-term measure to ensure the survival of the country’s property sector.
Finance Ministry’s director of the National Budget Office Johan Mahmood Merican said although the decision was controversial, it did not sideline the people's right as it will only be implemented for a year and limited to completed and unsold units only.
“This is also limited to apartments and condominiums, not landed properties. So in terms of its negative implications, it is limited.
“Despite many questions, the government sometimes has to take steps that may be in question but it is made after proper consideration to ensure economic viability,” he told reporters after delivering a special briefing on the 2020 Budget and Current Issues, here today.
Earlier in the briefing, Johan said the measure was introduced as a result of the slowdown in the property sector due to the high number of unsold houses and commercial properties in the country.
He said if the government fail to take steps to reduce the stock of unsold properties, it would cause problems for many parties including banks that funded the projects, developers and workers involved.
“This high-value commercial unit has no demand from Malaysians. Since RM600,000 is above the value of affordable housing and no local demand, the government took the decision to encourage real estate sales,” he said.
During the tabling of the 2020 Budget, Lim had announced that the price threshold for high-rise property in urban areas for foreign ownership will be reduced from RM1 million to RM600,000 starting next year.
Lim said the move was taken to reduce the overhang of condos and apartments worth RM8.3 billion in the second quarter of 2019.
On other programmes in the 2020 Budget that elicited the most attention from the people, Johan said the ministry received many questions about the #MalaysiaKerja initiative as it was aimed at creating better employment opportunities for youth and women.
“This will involve a huge allocation and probably a lot of questions about eligibility and mechanism,” he said, adding that the Employees Provident Fund (EPF) would come up with details and explainations later.
The #MalaysiaKerja initiative is expected to create an additional 350,000 job opportunities for Malaysians in five years and reduce dependence on 130,000 foreign workers.