Thursday 28 Mar 2024
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KUALA LUMPUR: House prices in Malaysia are expected to rise about 3% after the goods and services tax (GST) is implemented starting in April.

Property consulting firm Rahim & Co executive chairman Tan Sri Abdul Rahim Abdul Rahman said although transactions on residential properties were GST exempted, building materials would be taxed under the GST.

“In my opinion, there will be a slight increase in residential housing prices, but not higher than 3%.

“There will be a wait-and-see attitude by house buyers, but I think eventually, the market will absorb it,” Abdul Rahim told a briefing on the Malaysian property market outlook yesterday.

He said the property market is expected to be stable, with signs of a slowdown.

But steady growth is still seen this year, Abdul Rahim said.

He was, however, mindful of a larger supply of office space. According to his estimates, there will be an additional 10 million sq ft of office space in the Klang Valley within the next three to five years.

An excess supply of office space is expected to fuel greater competition and rental pressure, according to Abdul Rahim.

As of the first half of 2014, Rahim & Co’s estimates showed there were 84 million sq ft of office space in Kuala Lumpur.

The occupancy rate stood at 80.1%, according to the firm.

 

This article first appeared in The Edge Financial Daily, on January 30, 2015.

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