Malaysia is gearing up for the introduction of a Goods and Services Tax (GST) at six percent in April 2015 which is expected to impact the country’s real estate market, said Knight Frank recently.
Although the GST will not apply on direct residential property purchases, it will increase the input costs for developers, hence some cost push inflation will be seen next year.
At the same time, a higher Real Capital Gains Tax (RPGT) on local and foreign buyers (up to 30 percent if disposed of within a year) and tighter lending conditions should contribute to a relatively subdued housing market performance, the report noted.
Despite this, there will still be pockets of opportunities for Singapore-based investors looking across the causeway. For instance, new transport infrastructure projects in Kuala Lumpur have brought some attention to potential residential hotspots in the city.
According to Judy Ong, Executive Director, Knight Frank Malaysia, ongoing extensions to KL’s Light Rail Transit (LRT) system will likely be completed in 2016, reducing travel times for residents living along the Ampang and Kelana Jaya lines significantly.
As a result, property projects located near key stations along the two LRT lines will perform well, including Subang Jaya-USJ, Putra Heights, Kelana Jaya, Glenmarie, Kinrara and Puchong.
“Puchong-Kinrara, Bukit Jalil and Subang-Sunway are the three key hotspots we are highlighting for potential outperformance,” said Ong.
Source: Knight Frank Residential Research
To help unlock the top investment areas in KL and other Malaysian cities, PropertyGuru is holding the 10th instalment of its Malaysia Property Show this weekend (13-14 September) at Marina Bay Sands from 10am to 7pm daily.
Over 20 new developments from Klang Valley, Iskandar (Johor) and Malacca will be on show, with more than 12 big name Malaysian developers taking part.
There will also be various educational seminars on both days given by industry experts with topics ranging from where the opportunities in the Malaysian market are, to how you should navigate through the changes in the property landscape.
Admission is free. To register, please go to: bit.ly/XXbmIK
Romesh Navaratnarajah, Singapore Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email romesh@propertyguru.com.sg
