Finally some good news for home owners in Malaysia. The Malaysia’s Central Bank (BNM) announced on Friday the 25th of July that the Overnight Policy Rate (OPR) will remain unchanged at 3.50%. This is great news to all Malaysians as the OPR is used as a guide to the Base Lending Rate for loans in Malaysia. With the OPR remaining unchange, Malaysians can expect the interest rates for their loans and overdrafts to remain unchange as well. (The current BLR for most banks are at 6.75%)

Despite earlier market speculations that the OPR will be raised to stem the growing inflation, I am glad that Bank Negara have decided to keep the current 3.5% rate.  Most Malaysian are still reeling from the effect of the higher fuel prices as well as the rise in basic consumer goods, as such a rise in their monthly mortgage payments is the last thing anyone would want. At least now, the mortgage payment for most families remains a constant unchanged amount.

For the full BNM statement on the OPR, click here

By THEAN LEE CHENG

E&O launches seaside bungalows

FOR centuries, Penang has attracted traders, seafarers and adventurers from far and wide. Today, the island is no less popular, being one of Malaysia’s front-runners in the real estate investment market after Kuala Lumpur. It is against this backdrop of sun and surf, and city living that E&O Property Development Bhd is building the largest waterfront project there.

The company laid the foundation for the Seri Tanjung Pinang community by first selling double-storey terrace and semi-detached housing. It recently took things a notch higher by launching bungalows in three designs.

Martinique, one of three designs of waterfront bungalows with pool fronting the Straits of Malacca by E&O Property Development in Seri Tanjung Pinang.

Known as Skye, Abrezza and Martinique, the bungalows are set apart from other landed developments taking place on the island because of several factors.

The first is the overall ambience. Each home design draws inspiration from the different elements around the world that make living a pleasure.

Although the look, feel and design vary, a single thread binds them and the buyers who take to them – the desire for the finer things in life.

Those who have visited the show village and the show houses would probably agree that Martinique is the most spectacular of the three.

It blends classic lines with the best of materials like nyatoh balustrades, Italian marble flooring and Burmese teak.

Fronting the Straits of Malacca and enveloped by a meandering waterfront promenade, Martinique is a double-storey white sprawling mansion reminiscent of the white and beige plantation manors of the Caribbean Islands.

Read more »

(Editor :- Once again another a property outlook close to home) 

Bricks and Mortar
By TEH LIP KIM

WHILE last year was generally good for properties in Malaysia, particularly at the top end of the market, news of the credit crunch in the US stemming from the subprime mortgage crisis had become troubling by year-end. 

Still, we tend to remain optimistic about the prospects for Malaysian property. The government had put various measures in place for the property market and announced a series of liberalisations, financial incentives, and system enhancements even before the news of the credit crunch reached our shores. 

These included changes  changes to Employee Provident Fund (EPF) withdrawals. Effective this Jan 1, EPF members will be allowed to make a withdrawal every month from Account 2 of their accounts to finance their housing loans. Previously, EPF withdrawals for housing purposes were permitted only once every three years, and subsequently, once a year.  

If all 5.4 million EPF members take advantage of this initiative, about RM9.6bil is expected to be released for home purchases, which will surely give the real estate market a nudge in the right direction.  

Drawing on the experience of our neighbour down South, home ownership in Malaysia, currently at 67%, is likely to increase with this new monthly withdrawal scheme. In 1980, when Singapore allowed its Central Provident Fund (CPF) members to use their CPF money for paying off monthly mortgages, home ownership was 59%. By 2000, according to the Singapore Census, home ownership had risen to 92%.  Read more »

Editor :-Latest  Employee Provident Fund update on the monthly withdrawal scheme from Account 2 for the monthly mortgage payments. 

KUALA LUMPUR: The Employees Provident Fund (EPF) announced yesterday that members with a minimum balance of RM600 in their Account 2 will be able to withdraw their savings for payment of their monthly housing loan instalments beginning Jan 1. 

EPF senior general manager (organisation development) Hizwani Hassan said the minimum monthly withdrawal that can be made was RM100 for a period of not less than six months, while the maximum amount should not exceed the total monthly housing instalment. 

“The savings in Account 2 allocated for this withdrawal cannot be used for other withdrawals,” he said in a statement, adding that members must also be below the age of 55 and not have any housing loan arrears. 

The monthly withdrawal facility, announced in the 2008 Budget, allows members to withdraw their savings from Account 2, with the payment being made directly to members’ personal bank accounts on a monthly basis.  Read more »

Editor :- I came across this interesting article on the Star newspaper on Saturday. Read it and feel free to share your comments with me. Kudos to S.DALI for publishing this article. 

THE Cost of Living (COL) survey by ECA International is carried out twice a year, comparing a basket of 128 consumer goods and services commonly purchased by expatriates in over 300 locations worldwide. Multinational companies use the results to help compensate their internationally mobile staff. Living costs for expatriates are affected by inflation, availability of goods and exchange rates, all of which can have a significant impact on expatriate remuneration packages. They concluded the following on Asian cities:  

“In Asia, Seoul maintains its position as the most expensive city in Asia for expatriates, moving from 8th to 7th in the global ranking over the past 12 months. During the same period, Tokyo, Asia’s second most costly city, dropped out of the top ten for the first time moving from 10th to 13th.   A 6% overall rise in the cost of goods and services typically purchased by expatriates has meant that despite the weakening Hong Kong dollar, Hong Kong’s position in the ranking has remained steady and is still the fifth most expensive location in the region and ranked 79th worldwide.  The recent rise in GST in Singapore from 5% to 7% has contributed to pushing up living costs in Singapore, which has risen 10 places in the ranking since 2006. This, together with no change in Hong Kong’s position, means that the gap is closing between the two locations.”  Where does Malaysia stand? 

1       (7) Seoul 

2       (13) Tokyo 

5        (79) HK 

6        (94) Taipei 

7        (95) Beijing 

8        (100) Shanghai 

9       (122) Singapore 

11       (153) Jakarta 

18       (168) Bangkok 

24       (177) Mumbai 

25        (178) New Delhi 

29        (191) Manila 

32        (195) Hanoi 

33        (197) Kuala Lumpur 

35        (203) Karachi 

36       (204) Ho Chi Minh City 

  Read more »

Imagine this.

It’s a normal Monday and the kids are back from school. Out of curiosity, you log on to your home webcam just to see what they are up to :). There they are, the two kids are up to their naughty mischiefs again. “Ha ha”, you laughed, knowing where those pesky ”booby” traps are that they have “lovingly” set up for you at home.

Next you ”ping” your refrigerator and make a download of a list of foodstuff available. Going through the list, you realised that you may not have enough food for dinner later. As such you make a quick order to your friendly neighbourhood grocery shop or hypermart which then drops off your groceries at your door step as you return from work. Phew, that sure saves the trouble of queuing up at the counter. 

Amazing scenario? Well it may well come true in the township of the future which all Malaysians may one day live. This is provided that all the government efforts to increase the rate of Internet penetration in Malaysia bears fruit.

The foundations for this has already begin to take shape. The government is offering its expertise in a private-public partnership to improve the telecommunications infrastructure to existing and new housing estates. 

Read more »

To encourage Malaysians to have better quality of life as well as to ease the burden of owning a house, the Malaysian government has made provisions in Budget 2008 to allow the monthly withdrawals of the balance in Account II for home loan repayment.

In other words, Employee Provident Fund (EPF) contributors will now be able to make use of their Account II balances to assist them in the Monthly Home Mortgage repayments. For example, an average wage earner earning RM3,000 a month will be able to use his EPF to contribute an additional RM207 a month towards his home mortgage repayments.

To illustrate the above point further, here’s a breakdown on the calculations

Monthly Wage = RM3,000

Monthly EPF Contributions
a. Contribution from Employee (11%) = RM330
b. Contribution from Employer (12%) = RM360

Total Monthly Contribution to EPF (a.+b) = RM690

Hence, Monthly Account II allocation is RM207 (30% of the total monthly contributions)

As such, new and current home owners stand to benefit as follows:

• Qualifying for a higher Home Loan Quantum as the qualifying monthly Mortgage repayment is RM1,207 instead of RM1,000 (Based on the rule that monthly mortgage repayments should <1/3 of your monthly salary)

• Ability to purchase a property at a much higher price range. Current home owners may consider trading their current home for a bigger one

• Or for current home owners on Flexible Home Loan, using the monthly EPF witdrawals to boost the monthly repayments translates to lower interest charges and overall lower cost of ownership.

On the surface, this policy looks like another win-win policy for the people and the real estate industry. However the implementation of this policy from the EPF statutory body leaves a lot to yearn for. Read more »

Some sneak peek into the the biggest exhibition on property, home and lifestyle in the northern region of Malaysia. Read more »

The Malaysian 2008 budget was tabled in Parliament two weeks back with numerous goodies for those shopping for a new home. The government hopes that these new measures would help stimulate the property sector in Malaysia.

For starters, the Stamp Duty for the Land Title Transfer for properties costing less than RM250,000 has been halved. This benefit is applicable for the purchase of one house for the whole of financial year of 2008.

Property           Price Stamp      Stamp Duty in 2007      Stamp Duty in 2008
House A            RM250,000              RM4,500                      RM2,250 (-50%)
House B            RM150,000              RM2,000                      RM1,000 (-50%)
House C            RM350,000              RM6,000                      RM6,000 (unchanged)

(Based on the current rate of 1% for first RM100,000 and 2% for RM100,001 to RM1,000,000)

With this new measure, I can foresee new home buyers benefiting in 2 ways:

• Significant Stamp Duty Savings
• Encouragement to property developers to provide more properties at sub RM250,000 price tag to entice home buyers to invest.

However new home buyers please note that in the home buying process, you will incur two major Stamp Duties namely the Stamp Duty for Title Transfer and the Stamp Duty for the Bank Loan Facility Agreement.

(Refer to Key Learnings – Lawyers Lessons 2 and Lawyers Lessons 3)

The Stamp Duty for the Bank Loan Facility agreement remains unaffected by the above changes. The current prevailing rates of 0.5% of Loan amount still prevails.

Read more »

Today, the Malaysian Prime Minister Abdullah Ahmad Badawi announced a huge development project called the Northern Corridor Economic Region (NCER) expected to attract billions of investments into the region.

This is of course, is going to raise property prices at the region by at least 3 per cent, a report said.

My partner exclaimed, Read more »