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Friday, January 28, 2011

SP Setia buys land for RM126m

SP Setia Bhd, which has established a strong foothold in Johor, continues to expand its landbank in the state by acquiring a land from Kenyalang Property Development Sdn Bhd for RM125.8 million.

In a filing to Bursa Malaysia today, SP Setia said its subsidiary, Setia Indah Sdn Bhd, had entered into an agreement with Kenyalang for the acquisition, which is expected to conclude during the financial year ending Oct 31, 2011.

It plans to develop a mixed residential development project on the land, located in the Tebrau corridor.

Currently, it is developing four on-going project within the corridor, namely Bukit Indah Johor, Setia Indah Johor, Setia Tropika and Setia Eco Gardens.

SP Setia said the proposed acquisition was in line with its strategy to strengthen its presence in the state while taking advantage of the exciting happenings in the Iskandar region.
It is also expected to contribute positively to the future earnings and cash flow of the group.

By Bernama

China's first property taxes kick in

China's long-awaited first property taxes took effect on Friday in Shanghai and the mega-city of Chongqing in the southwest, as the country tries to reform its booming real estate market.

People buying higher-end second homes in Shanghai, China's wealthiest city, and Chongqing, home to 30 million people and the country's fastest-growing municipality, now have to pay a 0.4-1.2 percent annual tax, officials said.

But Chongqing Mayor Huang Qifan said the pilot tax programmes were not aimed at clipping the soaring real estate prices that are a top consumer concern across the country.

"People will ask if I think the real estate tax will definitely bring property prices down.... No one believes the property tax will hit the nail on the head and bring prices down," Huang told a news conference late Thursday.

He estimated the tax would generate 150 million yuan ($22.8 million) in revenue for the municipal government this year, according to an official transcript, although state media cited him as saying 200 million yuan.Michael Klibaner, head of China research for property company Jones Lang LaSalle, said the ultimate aim of the tax was not to rein in prices, but rather to prevent hoarding of properties, a pressing problem in recent months.

"Previously there was very little holding cost for residential property because many people paid 100 percent cash for these properties.

Now the holding cost is no longer zero," Klibaner told AFP.

"When the holding cost is zero, it's very easy to let these homes sit idle.

It doesn't cost you anything to let them sit there. It's like gold," he said. "Now there's a holding cost -- the hope is it will change the way people perceive real estate as an asset class.

"The two cities announced different tax pilot projects almost immediately after the State Council, China's cabinet, said it had approved the trials on Thursday.Shanghai announced a flat 0.6 percent tax on new second homes that are double the average market price.

New second homes costing less will be subject to a 0.4 percent tax.Chongqing introduced a progressive tax ranging from 0.5 percent for homes that are double the market average price and rising to a maximum of 1.2 percent depending on the value of the home.

The finance ministry said that if conditions were right, the property tax would be expanded to the rest of the country.

Property prices in China's major cities posted their fourth straight month-on-month rise in December and sales picked up pace, according to the latest government figures.Prices in 70 major cities were up 0.3 percent last month from November and were 6.4 percent higher than a year ago.

The annualised surge peaked in April, when prices soared 12.8 percent, but growth has since slowed.But prices have remained stubbornly high, despite a range of government measures such as hiking minimum down-payments on property transactions to at least 30 percent in a bid to avoid a damaging price bubble.


China to launch property tax on trial basis

China said Thursday it would start imposing property taxes on homes in some cities on a trial basis, in the government's latest move to try to cool the red-hot real-estate market.The State Council, China's cabinet, approved the trial but said the tax levy method would be decided by the governments of the provinces where the cities are located, the official Xinhua news agency said. It gave no more details.

A statement posted on the finance ministry's website said the tax would help "adjust income distribution and promote social equality.""People's living standards have hugely improved, but the income gap is also widening.... Property tax is one important method to adjust income and wealth distribution, and levying property taxes helps reduce the wealth gap," it said.It added the tax would help "rational" home-buying.

The trial is the latest in a range of measures taken by the government to curb spiralling property prices, as polls have shown the difficulty in affording housing has become the top consumer fear.On Wednesday, the government raised the minimum down payment for second homes to 60 percent of the property's value and ordered authorities to rein in real estate prices.

The central bank has also raised interest rates twice since October, and has increased the amount of money banks must keep in reserve in a bid to curb lending.But despite these policies, property prices in China's major cities have continued to increase, posting their fourth straight month-on-month rise in December as sales picked up pace.

The statement did not mention which cities would trial the tax, but Xinhua said Shanghai was one of them and had already set the tax rate at 0.4 to 0.6%.

The southwestern municipality of Chongqing is also one of the trial locations.According to a report on popular web portal, authorities in Chongqing have set the tax rate at between 0.5 and 1.2%.Chongqing mayor Huang Qifan estimates revenue from the tax will reach 200 million yuan ($30.4 million) and will be used to build public housing, the report said.

The finance ministry said that if conditions were right, the property tax would be expanded to the rest of the country.


Equine-JPSB project agreement

KUALA LUMPUR: Equine Capital Bhd’s wholly-owned subsidiary, Taman Equine (M) Sdn Bhd (TEM), has entered into a joint-development agreement with Jelang Puncak Sdn Bhd (JPSB) for a proposed project in Selangor worth RM198.1mil.

Equine Cap said the proposed development was expected to comprise of 177 units of properties comprising 138 units of two-, three- and five-storey shop offices and 39 units of low-cost shops within a multi-storey car park.

The project is expected to commence in early 2011 and completed in 2013.

By The Star

Equine unit calls off land purchase deal

EQUINE Capital Bhd’s wholly-owned unit Taman Equine (M) Sdn Bhd has scrapped a deal to buy a parcel of land in Selangor from Jelang Puncak Sdn Bhd for RM47.4 million.

The two companies will instead sign a joint development agreement (JDA) to build shop offices worth RM198.1 million on the land, Equine said in a filing to Bursa Malaysia yesterday.

By Business Times