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Sunday, December 14, 2008

Gaining buyers’ confidence

MORE prompt and effective government measures are needed to address the many challenges facing the country’s economy and property sector today.

The widening impact of the US financial crisis and the gloomy global economic outlook have eroded the people’s confidence to an all-time low.

Much wealth has been lost these past few months as stock and commodity prices around the world plunged and the prevailing mood is to conserve as much cash as possible and refrain from buying any big ticket items, including property.

As a tangible asset, property remains one of the most viable investment instruments to hedge against inflation.

It will certainly help if the Government starts the ball rolling to spur more demand-led growth by making more fiscal expenditure on critical sectors, including development projects with high multiplier effects under the Ninth Malaysia Plan.

With the expected prolonged impact of the global crisis on the local economy, industry players have expressed their concern over whether the Government’s RM7bil economic stimulus package is adequate to give a lift to the economy as governments around the world are making much larger commitments to boost their staggering economies.

They are urging the Government to spend more and ensure the fast and efficient implementation of critical projects that have huge spillover effects on the other sectors.

Given their link to at least 140 other industries, the property and construction sectors have a huge role to play to breathe more life into the local economy.

To encourage the 67% to 70% of the local population who still do not own homes to start buying their own property, a RM10,000 grant given out to all first-time house buyers will help ease the people’s burden and inject a much needed boost to the housing sector. Even the Australian and Canadian governments are rewarding their first time home buyers with grants and the measure had proven to be effective in spurring greater buying activities during the present “credit crunch” times.

Saturday’s pre-dawn landslide in Bukit Antarabangsa that cost at least four lives and immense damage to property value also needs immediate attention and concrete steps to prevent such mishaps from happening again.

The latest disaster has once again cast the spotlight on hillslope developments as residents staying around such projects are rightly worried for their safety and are calling for construction work to be halted immediately.

Meanwhile, developers with approved projects and land in those “critical” zones are not about to give up easily as they have invested in the land and gone through the proper channels to seek the authorities’ approvals for their building plans and projects.

Rather than adopting “knee jerk” responses to address the situation, industry players want to know why the authorities have yet to draw up a “list of dos and don’ts” involving hill land after the collapse of the Highland Towers in Hulu Kelang 15 years ago.

“At least, they should have properly filed records of who are the landowners and developers of projects in the surrounding areas, what is the nature of the soil and other critical information, such as underground water and soil conditions.

Regular checks on these areas should have been carried out after the first landslide to avoid other mishaps,” says Real Estate and Housing Developers Association Selangor chairman Datuk FD Iskandar.

Since these information are still not available, technical experts should be called in to address these issues and draw up consistent and transparent guidelines governing hillslope land, especially those in the landslide vicinity.

And if the Government wants to stop hillslope projects that have been approved by the state authorities from continuing, developers should be compensated accordingly after a valuation exercise is carried out to determine the value of the land.

Angie Ng is deputy news editor at The Star. She believes that Malaysians are a very hardy people and much can be achieved if more focused efforts are expended to mobilise their resourcefulness and potential

By The Star (by Angie Ng)

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