He said despite rising residential property prices, houses in Malaysia were still among the cheapest in the region.
“Residential property prices increased at a constant pace in Malaysia until 2009, but have been accelerating until recently.
“However, prices are not as volatile as those observed in Hong Kong and Singapore,” he said in a presentation during the 16th National Housing and Property Summit 2013.
“In comparison with selected Asian luxury residential prices, Kuala Lumpur remains one of the cheapest cities in the region,” said Boyd.
According to him, the average luxury residential property in Hong Kong costs nearly US$3,000 (RM10,200) per sq ft, compared with US$250 (RM850) per sq ft in Kuala Lumpur.
He pointed out that to overcome the issue of rising property prices, the Government had launched two schemes to make houses affordable, namely the Malaysia My First Home Scheme, which was introduced in 2011, and the 1Malaysia Housing Programme, which came into effect in 2012.
Meanwhile, Universiti Putra Malaysia Housing Research Centre professor Datuk Abang Abdullah Abang Ali said the recent Government initiatives were addressing the issue of rising prices but added that it was not clear if that was enough.
He said artificial increase in prices would create a bubble, noting that there was a serious mismatch between income and property prices, especially in the Klang Valley.
“This indicates that affordable homes are not being built to cater to the general market and most buyers in the Klang Valley are likely to be investors or speculators.
“As market prices head for a correction and speculation decreases, there may be an oversupply of properties above RM550,000.”
Urban Wellbeing, Housing and Local Government Minister Datuk Abdul Rahman Dahlan, in his opening speech, said the Government had to mitigate excessive investment and speculative activity in the property market so as to prevent a property bubble.
“Moving forward, the Government would not hesitate to further tighten the fiscal policies in order to curb property speculation and ensure reasonable and affordable property prices in the country.”
Abdul Rahman said the low real property gains tax, which was increased from 5% to 15% last year, had not been effective in preventing the increase in house prices.
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