Rehda urges states to cut red tape on property transfers
24/01/2007 BT By Chong Jin Hun

THE Real Estate And Housing Developers' Association (Rehda) claims that measures to liberalise foreign ownership of Malaysian properties announced late last year could be hampered by slow processing at the state level.

It takes some state authorities up to 153 days to approve real estate transfers compared with about 14 days in Singapore and Australia, they said.

Since December 2006, Malaysia has allowed foreign buyers to own or invest in houses costing RM250,000 onwards without seeking approval from the Foreign Investment Committee (FIC).

Foreigners are also not subject to any conditions on the usage of their properties, or limit on the number of houses they can buy.

"Just one policy from the FIC alone does not get foreigners excited. It is a step in the right direction, but foreigners are looking at Malaysia as one country among so many other countries.

"We urge the state authorities to relax their property transfer policies. Administrative red tape has to be drastically reduced," Rehda president Ng Seing Liong said in Kuala Lumpur yesterday at a media briefing on Malaysia's property market.

Ng said the liberalised regulations should boost demand for upmarket houses in prime areas like the Kuala Lumpur City Centre (KLCC), Mont'Kiara and Bangsar in the Klang Valley, but may not be felt across the board.

"Nevertheless, we do sense that there is increased interest from foreign purchasers for high-end properties in major urban areas, especially Kuala Lumpur, Penang and Johor Baru," Ng said.

Up to 52 per cent of respondents in Rehda's recent survey believed that the local real estate sector will be skewed towards residential offerings this year, especially niche higher-end units.

Regionally, Malaysian property prices are still deemed competitive, offering overseas investors a lower entry level into the country's real estate market compared with other countries.

On a per sq ft basis, Malaysian properties can fetch up to RM1,000 compared with about RM3,000 in Singapore, RM1,200 in Bangkok, and RM6,000 in Hong Kong, according to real estate agency Hartaemas Real Estate Sdn Bhd.