News: HOC’s RM3b Sales Target Attainable, Developers

Mar 18, 2019

 

Developers are confident that the RM3 billion sales target set for the six-month long Home Ownership Campaign (HOC) will be achieved, reported The Star.

“I don’t want to speculate but I am sure we can hit that RM3 billion sales target,” said Datuk Soam Heng Choon, Chairman of the Real Estate and Housing Developers’ Association at a briefing on “Property Industry Survey 2H 2019 and Market Outlook 1H2019 and 2H 2019”.

“We are talking about a period of six months, not the three-day HOC event between March 1 and 3.”

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The event has led to a market improvement in perception and sentiment among developers who witnessed more visitors coming in their sales galleries, said Soam.

“The feeling among developers is that if they have more visitors at their sales galleries, there is the chance they will be able to close a sale.”

His statement was made in response to property consultants’ comment that the RM3 billion sales target of the campaign was on the optimistic side.

Given the various stamp duty waivers by the government, rebates and freebies from developers until 30 June, Soam explained that the general perception among developers was that a further improvement in sentiment would be seen by the second half of the year.

“Developers are optimistic about the first half of 2019. The level of optimism is expected to increase further in the following six months,” said Soam, quoting a 121-respondent survey conducted during the second half of 2018.

However, he acknowledged that loan rejection remains as the main obstacle for potential buyers.

“They were ineligible due to their income. They were offered a lower margin of financing when they want a higher margin and they have adverse credit history,” said Soam.

“Many young buyers were rejected because they did not pay their National Higher Education Fund loans. They have to clear or re-schedule their loans first.”

He underscored that while they support “Bank Negara’s policy of not giving new loans to people who do not qualify but we also would like banks and lending institutions to consider a potential buyer’s other sources of income”.

He noted that developers do not also like buyers who are not credit worthy. “We do not want a systemic failure in our financing system,” he stated.

Image source from The Star Online

 

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James Teoh
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