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Thursday, April 7, 2011

Dijaya unit to buy land for RM19.5m

PETALING JAYA: Dijaya Corp Bhd’s wholly owned subsidiary Tropicana Golf & Country Resort Bhd, through its subsidiary Mawar Hebat Sdn Bhd, has signed an agreement with Mentari Land Sdn Bhd to buy 36 parcels of vacant leasehold land totalling 7,131 sq m near Sunway Mentari in Selangor, for RM19.5mil.

Dijaya said in a filing with Bursa Malaysia that the land parcels had 99-year lease expiring April 11, 2101.

By The Star

Taiwan to impose tax to curb home prices

A planned "luxury tax" that aims to rein in property speculation in Taiwan came a step nearer on Wednesday when it breezed through its first reading.

The Finance Committee gave the go-ahead to the first draft of the bill after President Ma Ying-jeou ordered legislators in his Kuomintang party, which holds a majority on the committee, to help push it through.

The move comes as house prices in Taiwan have soared, leading to tensions over the widening gap between the island's rich and poor that has seen Taipei become one of Asia most expensive cities.

"The approval of the bill today marks a triumph of social justice ... hopefully it will help crack down on short-term speculation," Kuomintang legislator Fei Hung-tai, a committee convenor, told reporters.

Fei expected the committee to pass the second and third and final reading of the bill before it is voted on by parliament towards the end of the month.

Under the provisions of the bill anyone who sells non-residential properties and vacant land within two years of buying it will face a levy of up to 15 percent.

It also includes plans for a 10 percent special sales tax on luxury goods such as yachts, private jets, furs and high-end furniture.

The bill was introduced as various government data indicate Taiwan, once a relatively equal society, is gradually seeing a more unequal distribution of wealth, with property prices emerging as a key public bugbear.

The most prosperous 20 percent in Taiwan reported average disposable incomes of Tw$1.79 million ($60,700) in 2009, more than six times that of the poorest 20 percent -- the largest gap since 2001.

At the end of October, the average price of property in Taipei hit $4,614 per square metre ($430 per square foot), up 15 percent from last year, according to property agency Taiwan Realty.

By The Star

US housing system a bad model: IMF

The International Monetary Fund on Wednesday singled out the United States as a poster child for bad housing policies, calling on Washington to reform for the sake of global financial stability.

"The US housing finance system, which has several unique features, needs to be reformed," said the IMF in its twice-yearly Global Financial Stability Report.

Four years after the US subprime mortgage crisis unleashed a global meltdown, the IMF offered up the United States as an example of what not to do.

Analyzing mortgage finance systems in 33 countries, the IMF painted a dysfunctional US model.

The United States generously subsidizes homebuying, but poorly regulates lenders, maintains financing mechanisms that are opaque and has a housing market today that is difficult for the poor to access.

According to an index developed by Fund economists, the United States is among the countries where governments intervene the most, topped only by Brazil, Singapore, India and Indonesia.

The US housing sector still has not recovered from the collapse of a price bubble in 2006 which triggered the subprime crisis as homebuyers with patchy credit began to default on payments.

For the 187-nation IMF, the fundamental problems in the US remain.

"The US housing finance system is unusual in many respects. An overhaul of important aspects of this system is needed," said the IMF, citing a fragmented regulatory structure and generous tax breaks.

"Such reforms would have a significant positive effect on the US financial system and would help bolster global financial stability," it said.

The IMF recommended three broad areas of "best practices": Enhanced regulation of mortgage lending, careful use of government participation in the housing sector and better transparency in the market for housing related securities.

The IMF offered a lukewarm assessment of the US government's housing finance reform plan proposed in February.

"While an overhaul of the housing finance system will take years to complete, US authorities need to step up their efforts now to develop and implement an appropriate action plan.

"The Washington-based institution supported the US government's plan for a progressive unwinding of the country's two mortgage finance giants, Fannie Mae and Freddie Mac.

The federal government took over the two collapsing companies in September 2008 in a bid to stabilize the financial system and agreed to pump money into them to keep them afloat.The IMF was clear in its criticism of US homeowner tax breaks, which enjoy broad support across the political spectrum.

"Apart from financial stability concerns, the US mortgage interest rate deduction is also costly -- at $104.5 billion in fiscal year 2011 it is the second-largest tax expenditure," it said, noting it had not shown a "discernible" impact on the home ownership rate.

Jan Brockmeijer, the IMF's deputy director of the monetary and capital markets department, underlined the reluctance of elected officials to address these questions.

"These are big issues, they have been recognized but they have not been dealt with. And it's not surprising that they have not been dealt with adequately, because they're very complex, politically complex in the sense of the housing market," he said at a news conference in Washington.

By The Star