Property market still 'very active' despite FDI slowdown

Post date: Jul 31, 2010 3:32:8 PM

THE local property sector has not been affected much by the slowing foreign direct investment (FDI) last year and can cope with the pressure, Housing and Local Government Minister Datuk Wira Chor Chee Heung said."All I can say is that the development of the housing industry in the country is very active. Although there is a reduction in FDI, we can still withstand (the pressure)," Chor told reporters on the sidelines of the 13th National Housing and Property Summit in Petaling Jaya, Selangor, yesterday.He was asked to comment on the United Nations Conference on Trade and Development report which said that FDI in Malaysia had plunged more than 80 per cent last year.Chor said that units offered at property launches in the Klang Valley, in particular, were quick to be taken up by buyers."This is probably because Malaysians have high saving rates that enable them to buy these properties."Added to this, the prices of properties in the country are still relatively low compared to neighbouring countries."

Chor said foreign investors were still keen to participate in the property industry here as they were optimistic of opportunities to make profits.

He said there were no worries at the moment that rising prices could lead to a property bubble, adding that the government had no plans to control prices.

"There is no property bubble in the country as demand and supply is matched properly. There is no fear of a property bubble here.

"We have not reached the stage yet and the mechanisms are right in place. It is still manageable," he said.

Chor, who is also MCA vicepresident, criticised the DAP for publicly calling for the removal of the 5 per cent discount for Bumiputeras to buy luxury homes.

"The MCA had discussed the idea of slashing Bumiputera discounts for luxury homes even before it was raised by DAP's PJ (Petaling Jaya) Utara MP (member of Parliament), Tony Pua, last week.

"But we did not bring it up in public until a proper study and consultation is made. Unlike them, we just don't simply say anything that crosses our mind."

Chor was responding to Pua's suggestion to the Selangor state government to remove Bumiputera discounts for luxury homes and commercial properties in the state to boost competitiveness and restore investor confidence.

"We have to look at the statistics and discuss the matter thoroughly, including getting feedback from the Bumiputeras themselves," he said.

Chor, however, said the MCA felt that it would be better if the rich Bumiputeras did not take the 5 per cent discount, but channelled that instead to help the poor Bumiputeras.

By : Kamarul Yunus

Source : Business Times

Date Published : 30 July 2010