According to Chief Minister of Penang, Lim Guan Eng, the new housing rules will help curbing property speculation. The new housing rules will be implemented from February 1, 2014. With state approval, first-time house buyers can sell their property in a particular timeframe, which is a delay of up to 10 years for selling their property. The cessation rule is effective for low-costing homes of up to RM 42,000 and low-medium costing homes of up to RM 72,500, including all past and future expenses. With the approval, the property can be sold only to listed buyers that have registration in the state’s housing department and certified with a low income.
Penang will be the first state government to impose restrictions on home ownership, while Malaysians struggle with the inflating home prices. The budget will have 30% of real property gains tax (RPGT) from properties of first three years. Putrajaya also looks forward to cease the developer interest-bearing scheme (DIBS) to prevent down-payment and servicing of mortgages on project completion for a normal property market.
The budget will also impose on sale of affordable housing not over RM 400,000 on the island and RM 250,000 on the mainland. Foreigners will have to purchase property in Penang of RM 1 million according to the new rule, and can buy landed property on the island only if it’s worth more than RM2 million. They will also have to pay a 3% tax on the property price, but there will be exceptions for industry purchase or for the motive of enhancing employment, education, human talent or placing Penang on the international map. After February 1, 2014, imposition of a 2% tax will be implemented for property sale within three years, except affordable housing.