KUALA LUMPUR - Johor is planning to impose a 2 per cent levy on foreign buyers across all segments of the property market and the secondary market in the southern Malaysian state from May.
The rate is lower than the 4-5 per cent mooted earlier, but will still amount to more than twice the current RM10,000 (S$3,900) fee that foreigners pay to buy property in the state.
As foreigners are required to purchase units valued at RM1 million and above, the RM10,000 fee is at most a 1 per cent levy.
The levy comes on top of the Malaysian government's recent measures to cool the property market.
However, the RM1-million threshold applies only to new applications, not to projects already approved, said the chairman of the Johor branch of the Real Estate and Housing Developers' Association (Rehda), Mr Koh Moo Hing.
Referring to the state of Johor's statement that it was expecting the levy to boost its coffers and curb spiralling home prices, Mr Koh told The Business Times that it was local demand that was pushing up prices, and that quotas were already in place to control foreign ownership.
Rehda Johor has thus flagged to the state government that the levy would not be effective.
Penang is also mulling over a levy on foreign buyers. The first state to push the minimum-price threshold for foreigners to RM2 million for landed homes and RM1 million for strata units, it is likely to go ahead with a proposed 3 per cent levy.
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