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Thread: D-Day for foreigners eyeing Johor property

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    Default D-Day for foreigners eyeing Johor property

    http://www.straitstimes.com/archive/...perty-20140220

    D-Day for foreigners eyeing Johor property

    They have till April 30 to ink purchase papers before new curbs kick in

    Published on Feb 20, 2014

    By Anita Gabriel Senior Correspondent


    FOREIGN buyers of residential property in Malaysia's Johor state have until April 30 if they want to dodge new property measures there such as higher levies.

    The cut-off date - April 30 - is contained in a Feb 10 circular from Johor's Land and Mineral Office obtained by The Straits Times.

    The new rules will also apply in Iskandar, a hot hunting ground for many Singaporean real estate investors, who make up some 70 per cent of overseas buyers in the booming growth corridor that is three times the size of Singapore.

    News of the cut-off date, coupled with the strong Singdollar - now trading at about RM2.61 - could spur fresh buying by Singaporeans across the Causeway.

    In short, investors need to ink a sales and purchase agreement by April 30 and submit it to the state's land department by May 29 to avoid the new measures.

    An official announcement is expected soon. The changes include a higher pricing threshold, which limits foreigners to only properties worth RM1 million (S$382,000) and above.

    This means foreigners can still scoop up properties with the current minimum RM500,000 price.

    Foreign buyers of Johor properties who get the documents signed and sealed before May 1 will also escape the sting of a higher levy of 2 per cent.

    According to the document, a 2 per cent levy or RM20,000, whichever is higher, will be imposed on property purchases by foreigners.

    The new rate is almost double the current RM10,000 fee foreigners pay to buy properties there.

    This is probably the first indication that the higher levy - widely speculated since late last year - will soon be enforced on properties bought by foreigners.

    "There has been so much noise and confusion over the new rules. It makes our life easier now that we've finally got something in writing to better explain to our buyers," said an executive from a major Malaysian developer with big projects in Iskandar.

    But some ambiguity persists and this appears to be frustrating developers.

    "We are still not sure which projects exactly will be exempt from this new rule. Earlier, we were told that as long as we received approvals from the state on our building plans, our projects would be exempt from the new rules," said the executive, referring to the higher pricing bar for overseas buyers.

    The recent circular makes no mention of this, which continues to leave many developers baffled.

    "Do we push ahead with our plans to catch the May window or do we need to tweak the design of our units and price them at RM1 million and above to woo foreign buyers? We are still not sure and the state has not been consistent on this," said another top executive with a firm that has a mega high-end project in Iskandar.

    The new measures, announced last October, aim to stem the sharp spikes in property prices in several hot zones in the country, partly led by feverish buying among foreigners.

    The Malaysian government also raised the capital gains tax for non-citizens to 30 per cent for properties sold within five years of purchase and 5 per cent in the sixth and subsequent years.

    Since the moves were announced late last year, property developers say Singaporeans, who were previously snapping up properties in the state owing to the sweet prospects of close proximity and higher property prices at home, have now adopted a wait-and-see attitude.

    As a result, some property projects have suffered a significant drop in sales.

    That has not stopped the dizzying pace of building. Malaysia's The Star newspaper reported recently that Johor's property landscape is being flooded with a massive wave of fresh supply that may prove to be unsustainable.

    The numbers are eye-popping. Latest data indicates that the number of new homes being built in the near future adds up to some 42 per cent of the current stock of 702,101 in the state.

    "The curbs come in handy. There is excessive building in the state and some developers are also building smaller units at high prices. This could lead to a serious bubble of speculation," said an analyst.

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    Forget iskanda. Waste time. Its another $$$ trap Malaysia setup to trap SGD$
    “Nothing in the world is more dangerous than sincere ignorance and conscientious stupidity.”
    ― Martin Luther King, Jr.

    OUT WITH THE SHIT TRASH

    https://www.facebook.com/shutdowntrs

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    Quote Originally Posted by minority View Post
    Forget iskanda. Waste time. Its another $$$ trap Malaysia setup to trap SGD$
    Kinda agree with u..

    I dun think their local govt is committed to develop a condusive retirement village environment for singaporeans. ie security, medical or family entertainment etc. Pls dun say legoland hor.. cos singaporeans cannot be going legoland day in day out non stop.

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    Iskandar is a waste of time. Near sg doesn't mean it is sg. Johor will always be johor, a god forsaken place.

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    Quote Originally Posted by Patrickstar View Post
    Iskandar is a waste of time. Near sg doesn't mean it is sg. Johor will always be johor, a god forsaken place.
    To each his own lor. I am actually so pleased with my S$200k freehold intermediate terrace, that I bought another freehold corner terrace for S$270K.

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    All i can say is good luck to your investment.

    Quote Originally Posted by Warren49 View Post
    To each his own lor. I am actually so pleased with my S$200k freehold intermediate terrace, that I bought another freehold corner terrace for S$270K.

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    Quote Originally Posted by Warren49 View Post
    To each his own lor. I am actually so pleased with my S$200k freehold intermediate terrace, that I bought another freehold corner terrace for S$270K.
    Terraces? Buy bungalows la ...

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    Quote Originally Posted by Abunn View Post
    Terraces? Buy bungalows la ...
    My assessment is that Iskandar terraces market still has some way to go, while the high end semi-d/bungalow segment is fast reaching KL/Penang levels.

    It's a personal assessment of course, and any capital gains are still chicken feed, when converted to SGD. At most S$100k to S$150k.....

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    Quote Originally Posted by Warren49 View Post
    My assessment is that Iskandar terraces market still has some way to go, while the high end semi-d/bungalow segment is fast reaching KL/Penang levels.

    It's a personal assessment of course, and any capital gains are still chicken feed, when converted to SGD. At most S$100k to S$150k.....
    I see.

    And how much is the semi-d or bungalow doing now?

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    Quote Originally Posted by Abunn View Post
    I see.

    And how much is the semi-d or bungalow doing now?
    Semi-d in gd locations are from RM 1.5m upwards and can reach up to RM 2.5m. Bungalows are mostly from RM 3m onwards and can reach RM 5.5m.

    My assessment is that Terraces around RM600K-800K still has room to go upwards, considering its proximity to SG and KL/Penang prices.

    It's like choosing an OCR condo vs prime CCR. I feel when I choose OCR condo (i.e. terraces), it has appeal across a wider population segment (locals, SPR, Singaporeans). Of course, the profits from each sale is lesser also, given the lower risks.

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