KUALA LUMPUR (Oct 23): Budget 2016 tabled by the prime minister at Parliament this evening has been described by analysts as being "neutral" for the property sector.
RHB Research Institute senior analyst Loong Kok Wen said the government is trying to focus more on affordable housing in this budget.
"Overall Budget 2016 is quite neutral to the property sector. What developers wished for — such as lower real property gains tax (RGPT), lower stamp duty and the lower threshold for foreign ownership — all of these did not happen," she told theedgemarkets.com via telephone.
However, home buyers would have more options as the government is building more affordable homes, she said.
"This may not be good news for certain property developers as home buyers have more choices to buy houses nearer to the city centre, at a cheaper price," she added.
Another analyst from a local investment bank said the budget does not offer much excitement for the property sector.
"There is not much excitement for developers but more excitement for the construction players," he commented.
Meanwhile, in a statement, property developer S P Setia Bhd said that it had hoped the budget would provide more initiatives to address the subdued property market.
"However, we are encouraged to see the focus on helping first time home buyers continued from the previous budget. This is in line with S P Setia's focus in providing affordable homes to the market," said S P Setia acting president and chief executive officer Dato Khor Chap Jen.
He said the RM200 million allocated for First Home Deposit Financing Scheme will help first time home owners to pay the deposits when purchasing affordable housing.
"We are also glad that the government is continuing to improve the transport infrastructure, especially in Klang Valley and East Malaysia, as this will indirectly help the real estate along the routes," Khor added.
The developer also lauds the focus on green technology.
"S P Setia, being an eco developer and the first who introduced eco-developments in Malaysia, will continue to implement new green technologies in its developments for the betterment of its communities.
"We are also happy to note that the government is giving RM500 million incentives to encourage Industrialised Building System (IBS) as this will help to improve the construction industry in Malaysia," he added.