Post date: Sep 27, 2010 1:30:23 PM
Monday September 27, 2010
By WONG PEK MEI and ONG HAN SEAN
KUALA LUMPUR: A task force should be formed by the Government to look into mechanisms to curb the rising prices of homes, said National House Buyers Association.
Its honorary secretary-general Chang Kim Loong said the current prices of homes were ridiculously high.
“These are beyond the reach of upcoming young professionals, who cannot even afford their first home,” said Chang, adding that property prices in the Klang Valley had risen by 25% to 30% over the past five years.
“For example, one area that should be looked into is the hidden costs incurred by utility contractors, which are then transferred to developers, causing property prices to be jacked up.
“Ultimately, the task force’s role is to find ways to make property more affordable,” said Chang, urging the public not to listen to arguments from groups with vested interest in the housing market.
Chang said he was also agreeable to the idea of cutting the rate of housing loans for third and subsequent home purchases to 70% or 80% to curb speculation and prevent a property bubble burst.
He was commenting on a StarBiz report on Friday that there had been talks that bank loans for the third and subsequent home purchases could be further reduced to as low as 70%.
Fomca chief executive officer Datuk Paul Selvaraj said speculative property transactions had to be cut down.
“We need to curb the number of speculators and be fair to genuine buyers who want to buy their first home,” said Selvaraj.
First-time home buyer Loga Sundary, 26, said reducing the bank loan would be a positive step towards deterring high income group from buying up all the available properties.
“However, keeping the home loan cap at 80% will be a less drastic decision.
“If buyers have to fork out 30% needed to buy a home, they will be overwhelmed because they still have to pay for legal fees, stamp duty and furniture,” said Loga, who works as a system development executive.
Businesswoman Ong Yoki, 51, said she expected a property bubble burst in the future because homes in the Klang Valley were becoming too expensive.
“The rate should be maintained at 80% as we can’t even afford to buy houses in areas like Petaling Jaya and Subang Jaya,” said Ong, who was looking to purchase a second property.
On Sept 22, Prime Minister Datuk Seri Najib Tun Razak said Bank Negara might impose a limit on financing for subsequent purchases after the second property while first-time buyers could borrow up to 90%.