House Ownership Campaign (HOC) 2019 promises incentives, rebates and generally easier home-ownership among hopeful first-time homebuyers. With developers required to give minimum 10% discount on their properties (on top of other incentives, rebates and tax waivers), the government and REHDA is confident that the campaign will be able to clear RM3 billion worth of properties.
However, is RM3 billion in sales too tall an order though? PPC International managing director Datuk Siders Sittampalam seems to think so.
“I feel that the RM3bil target will be hard to achieve. How are all these buyers suddenly able to purchase properties?”
Sharing his sentiment is CBRE|WTW managing director Foo Gee Jen, who thinks that the target is a little too optimistic.
“There is a lot of affordable properties being offered during the HOC and the government is also playing its part in widening the eligibility bracket. However, it’s also important for the buyer to look into his own financial constraints.”
Developers however, are optimistic about hitting the RM3 billion sales target set for HOC2019.
“I don’t want to speculate but I am sure we can hit that RM3 billion sales target,” said Datuk Soam Heng Choon, Chairman of the Real Estate and Housing Developers’ Association.
MAPEX 2019 so far
The recent MAPEX, which was hosted at Kuala Lumpur Convention Centre (KLCC), has already raked in RM285 million involving 496 units of various types. Moreover, almost 5,000 PR1MA Homes were snapped up in just 3 weeks, thanks to the incentives and special discounts offered during HOC 2019.
As MAPEX 2019 is touring nationwide till the end of the campaign in June, it does seem possible to hit the target of RM3 billion, especially if they record similar sales to the one in KLCC.
The next MAPEX in Klang Valley, which will be held in the Mid Valley Exhibition Centre (MVEC), is expected to bring a larger crowd than the one at KLCC. This is due to the heightening awareness of HOC 2019 and MAPEX. Besides that, MVEC is expected to generate more footfall compared to KLCC, possibly leading to higher sales in comparison.
Better sentiment, but more needs to be done
According to a report by Malaysian Reserve, the total number of loans applied for the purchase of residential properties increased in January this year as compared to December 2018 and January 2018.
This indicates that demand is definitely there, but the rate of loan approval is pretty worrying. More needs to be done especially in financing aids and strategies. Some measures have been launched, such as Home Loan Pre-Approval (Property Guru) and LoanCare (iProperty) that enable homebuyers to get their home loan eligibility pre-approved so that their budget and house price can be matched. These measures are applauded and might be able to drive HOC 2019 even further.
According to a REHDA survey conducted on 1,747 visitors at the expo, 77% of participants said they would buy a house within the HOC period, aided by incentives such as the stamp duty exemption and discounts from developers.
In relation to this, developers are urged to be more transparent in their pricing without the confusing price breakdown and rebates. According to the report by The Star, buyers have to mentally remove layers of confusion to get to the real net price because developers want to “hold on to their prices” instead of an outright price reduction.
In conclusion, the implementation of exemptions and discounts should be done accordingly and monitored closely in order for the campaign to succeed.
It does seem that public sentiment on HOC and MAPEX is positive, with so many planning to buy a house within the HOC period. Ultimately, results will take time, and whether or not the sales target of RM3 billion will be achieved is anyone’s guess for now.
Article contributed by Property Advisor.