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Government may subsidise developers

07/03/2009 The Star

KUALA LUMPUR: The Government is considering subsidising the construction of low-cost houses by private developers due to rising costs.

Housing and Local Government Minister Datuk Seri Ong Ka Chuan said the current RM42,000 ceiling price for such houses could not cover the higher construction costs.

“We cannot raise the price of low-cost homes as poor families might not able to afford them, especially due to the current economic downturn.

“The ministry is discussing with the Treasury to create a fund to subsidise private developers as a way to absorb the increased costs and maintain the current price,” he told reporters after opening the Malaysia Property Exposition at the Mid-Valley Exhibition Centre here yesterday.

Earlier, Real Estate and Housing Developers’ Association Malaysia (Rehda) president Datuk Ng Seing Liong, in his speech, said the Government should take over the building of low-cost homes.

Ng said the Government should review the current price from RM42,000 to RM60,000, and RM75,000 within the Klang Valley, to mitigate higher construction costs.

Ong said the Government would subsidise low-cost housing projects “with conditions”, including having the right to choose qualified buyers and ensuring locations were strategic.

He said the ministry was also considering waiving the stamp duty for properties under RM100,000 and halving stamp duty for houses costing more than RM100,000.

Currently, the stamp duty for houses under RM100,000 was 1% of the price, 2% for those priced between RM100,000 and RM500,000, and 3% for those priced above RM500,000.


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