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May 2011 News Issue 4

May 2011 News Issue 4

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06/08/2011

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May 2011 Volume 1 Issue 4

REAL ESTATE NEWS AT A GLANCE Public Statement
DOWNTREND IN PROPERTY LOANS.

Comments
· The change of loan-to-value (LTV) policy does address and reduce the issue of speculative activity in the property market but does not eliminate them totally. Speculators in this country are backed by large block of funds. The change of LTV policy does not affect nor dampen the demand factor in new developments because presently only established developers are involved in the property development of the country and headed by listed entities. Unlisted entities, for the past few years, have been eliminated from the industry. There is no major indicator indicating that this policy hinders lending to the property sector in regards to the landing portfolio of the bank to the property sector. The change of LTV policy only affects the secondary location and not the primary location of the property development activities in Malaysia.

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On November 2nd, 2010, the Central Bank of Malaysia announced a 70% loan-to-value (LTV) cap on a borrower's third and subsequent house-financing facility, which means that homebuyers would have to pay 30% down payment of the purchase price. A statement by the Central Bank of Malaysia (Bank Negara) says the 30% down payment requirement was put in place to curb speculative activity in the property market and to promote the continued affordability of homes for the general public.
Contact our team of consultants regarding detailed analysis on the Malaysia property market study, property news and recent price updates.

updates
Perpetual 99, Jalan Raja Muda Abdul Aziz 50300 Kuala Lumpur, Malaysia www.raineandhorne.com.my WE’LL LOOK AFTER YOU! T: 03-2698 0911 F: 03-2691 1959

Disclaimer: The information contained in this newsletter is for general information purposes only. While we endeavor to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the newsletter or the information, products, services, or related graphics contained on the newsletter for any purpose. Any reliance you place on such information is therefore strictly at your own risk.

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