Reinstate DIBS For First Time Home Buyers, Government Urged
Mah Sing Group Bhd wants the government to reinstate the Developer Interest Bearing Scheme (DIBS) in Budget 2016 – for first time home buyers only.
DIBS is a scheme where a property developer absorbs the home loan interest of the home buyers during the construction period of a property. The developer will pay any home loan interest that is borne by home buyer during construction (which is usually 36 months starting from project launch). Thereafter, home buyer will service the loan interest like any other normal home loan.
Mah Sing also urges the Government to review the real property gain tax (RPGT), including a minimum exemption to revive the property investments market.
RPGT is a tax on chargeable gains derived from disposal of property within a set period. A chargeable gain is the profit when the disposal price is more than purchase price of the property. The RPGT was increased in Budget 2014, to 30% for disposal in the first year, to curb property speculation.
Home buyers had cited strict bank lending standards as one of the reasons for being unable to own a home as quickly as they would want to. Bank Negara Malaysia (BNM) needs to ease the lending requirements for both first time and second time home buyers who aimed to shift to be a bigger property due to family expansion.
The property developer firm believes this move will be in line with the Government’s aspiration to assist first time property buyers. It would ease the purchase of homes by genuine home buyers by allowing them to lock in properties at current prices.
Mah Sing acclaims the Government’s continuous initiatives to encourage home ownership, especially for first time home buyers and their concerns about the affordability of properties.
The developer also opines that the property sector has a larger multiplier effect and stimulating such moves would have a larger impact on the wider economy.