Finance Minister YB Senator Tengku Datuk Seri Zafrul Tengku Abdul Aziz introduced
Budget 2022 in parliament on October 28, 2021, with the subject 'Keluarga Malaysia, Makmur Sejahtera' (A Prosperous Malaysian Family). This is Malaysia's highest budget in history, with an RM332.1 billion allocation.
The government has prioritized the construction of additional affordable housing in Budget 2022, as well as initiatives to aid individuals without a steady income in owning a property. Malaysia has a young and fast-rising urban population that wants the security of
owning a property.
House Ownership
The pandemic has boosted the desire for house ownership. We applaud the government's efforts to make house ownership more accessible to Malaysians of all economic levels. For Malaysian households, real estate is a significant source of wealth generation and financial stability.
As a result, Malaysian property developers are optimistic that the efforts included in Budget 2022 would boost the country's property market and hasten its recovery.
For example, the introduction of the Housing Credit Guarantee Scheme to assist people with no fixed income and no proof of income in owning a home, particularly gig workers, small business owners, and farmers, on the difficulties of obtaining housing loans is a commendable step, as financing has always been a challenge for this group.
Housing Credit Guarantee Scheme (HCGC)
The Malaysian government has set aside RM2 billion for the
Housing Credit Guarantee Scheme (HCGC). This is to assist people who do not have proof of a fixed income. The government is aware of the difficulties that gig workers, small company owners, and farmers have in obtaining a home loan.
In truth, many of these people can repay their debts, but the procedure of qualifying for a
house loan is complex without proof of fixed income. This program will not only assist prospective home buyers but will also help to stimulate the expansion of the local real estate market.
Also applauded in budget 2022 is the RM1.5 billion committed to the continuance of current housing programs for low-income earners, which would continue to assist eligible low-income earners in owning their dream homes. The government must continue to prioritize homeownership as a vital national strategy because it will assist improve the real estate market.
The government recognizes that every Keluarga Malaysia member has the right to own a house as a basic requirement of life. Towards that goal, the Government would continue housing projects exclusively for low-income families, with an allocation of RM1.5 billion.
This measure in Budget 2022 would indirectly assist lessen the burden of potential home purchasers, particularly those in the B40 group.
The Real Property Gains Tax (RPGT)
Furthermore, the Real Estate and Housing Developers' Association Malaysia (Rehda) is pleased that the government has considered their proposal to eliminate the
Real Property Gains Tax (RPGT) for houses intended to be disposed of by Malaysians and permanent residents in the country after the sixth year.
It means that beginning in the sixth year, the government would no longer levy Real Property Gains Tax (RPGT) on the sale of real property by residents, permanent residents (PR), and individuals other than companies.
Datuk Soam Heng Choon, head of the Real Estate and Housing Developers' Association (
REDHA), thought that this policy will help energise the property market, making it more robust and eventually translating into a beneficial multiplier impact on the economy. He also believed that it would assist to stimulate the sub-sale market.
In a Nutshell
The most important impact of the budget on real estate will be the following economic growth. Rapid economic growth and job creation will boost household savings and home demand. As a result, more first-time homebuyers are projected to make purchases under this budget.
With clearer government rules and property initiatives in Budget 2022, now is the perfect moment for a first-time homebuyer to buy a
residential property in Malaysia.
