Archive for the ‘Malaysia Property Sector’ Category

Land For Sale ! Hectare, Acre, Relong or Rai ?

Thursday, October 16th, 2008

In my many years of practice, I have come across land owners who are unsure about the exact land areas and even boundaries of the lands they own whilst some are confused with the land area conversion units from acre to hectare or relong to hectare and vice versa as different states have different adoption of land area measurement system.

www.intproperties.com blogs into this subject of land area conversion units with an aim to give you a better understanding and guides on the current land area conversion units commonly used in the northern states of Peninsular Malaysia ie Penang, Kedah and Perlis as well as the neighbouring country of Thailand.

Hectare, Acre, Relong or Rai

Although Malaysia has officially adopted a metric system since 1982, the British’s imperial units and local units are also very much in use. The computerisation of land titles registration in land offices in Malaysia over the last two decades and the implementation of E Tanah system have replaced much of the old titles and have used International System (SI) unit of hectare in land registrations.

The old unit of acre, which is non-SI, is still widely use in Penang State whilst relong is the local unit commonly used by the people in the Kedah and Perlis States. A browse on the land for sale listing posted on Malaysia’s popular portal of mudah.com shows that relong is still widely use in Kedah. 

In Kedah and Perlis, the early system of land tenure was influenced more by the ancient Thai Law of Property than by the Malay Customary Law. From an early date, ‘surat putus’ (or document of title) was issued by Sultans. Originally, these ‘surat putus’ was a written decision of ‘hakim’ or judge of the state following an ownership dispute, countersigned by the Sultan. The documents recorded the evidence submitted and the decision made together with the dimensions and area of the land concerned and a rough description of its locality and abuttals. The earliest survey of property lots started by 1912 in Kedah.

Whilst in Penang, the land registration inherited the British land tenure system. The English Law of Real Property and Conveyancing continued to be used until they were repealed and substituted with a system of Registration of Titles under the present National Land Code (Penang and Malacca Titles) Act, 1963. More at related article of history of land system.

Across the border to southern Thailand, the common land measurement is Rai. A Rai (Thai ไร่) is a unit of area, equal to 1,600 square metres (40 m × 40 m), used for measuring land area. Its current size is precisely derived from the metre, but is neither part of nor recognized by the modern metric system, the International System (SI). 1 Acre = 2.5 Rai, 1 hectare = 6.25 Rai. Guide on land measurement conversion in Thailand.

In UK, although the non-SI unit of acre is still in use, it will no longer be allowed when land is being registered come January 2010 in compliance with EU Metric Directive-European Union abolishes the British acre.

For advisory on land investments in Malaysia and Penang Properties, email to us at Izrin & Tan Properties Sdn. Bhd. or call us at +604 6588333 (Penang Office) or +603 92839782 (Kuala Lumpur Office) and we would be pleased to assist.

HOW TO CALCULATE LAND MEASUREMENT

SI units (Metric )
1 hectare = 10,000 sq meters

Non SI units
1 acre = 43,560 square foot
1 hectare = 2.471 acres

1 relong = 30,976 square feet
1 relong = 484 jempa
1 jempa = 64 sq ft
1 hectare = 3.4748 relong
1 acre = 4 rood
1 rood = 40 pole
1 rood = 10,890 sq. feet
1 pole = 272.25 sq. feet
1 sq meter = 10.76381 sq feet

Example 1
Land Area 5a 2r 20p = 5 + 0.5 + 0.125 = 5.625 acres x 43,560 square feet
= 245,025 square feet
= 22,763.80 square metes
= 2.2763 hectares

Example 2
Agricultural land in Kedah
Land Area 15 relong 50 jempa = 15 x 30,976 square feet + 50 x 64 square feet
= 467,840 square feet
= 43464.16 square metres
= 4.3464 hectares

Example of site plans attached in the old titles in Kedah and Perlis- with unit measurements in both relong and acre

Example of old land titles in Kedah issued in 1950’s

Malaysian Budget 2009 highlights and its impact on property sector

Saturday, August 30th, 2008

The 2009 Budget Speech was presented by the Prime Minister of Malaysia in Parliament House on 29th August 2008 and the highlights of the RM207.9 billion Budget are here(English), here(Malay) and here(Mandarin).

Highlights of Budget 2009 on property and housing :

a) First time house purchasers are eligible for 50% stamp duty waiver on sales and purchase agreement signed during the period of 30th August 2008 to 31st December 2010. Unlike budget 2008, The 50% stamp duty exemption to be extended to loan agreements as well to further reduce the cost of buying medium-cost houses of up to RM250,000. More related information on 50% stamp duty waiver at here, here and here.

The move is expected to help purchasers for homes costing under RM250,000 to save up to RM2,625.00 on stamp duty waiver on transfer instrument and loan document.

Example :

Stamp Duties

i) Loan Agreement
0.5% of the loan amount
ii) Transfer of Title (for completed properties)
1% for the first RM100,000
2% for the next RM400,000
3% on the excess above RM500,000

Purchase Price;RM250,000.00, Housing loan @90% of purchase price; RM225,000.00

Stamp Duty payable on transfer instrument; RM4,000.00
Stamp duty payable on loan document ; RM1,125.00
Total stamp duties payable ; RM5,125.00
Apply for 50% waiver on stamp duties ;RM2,562.50
Amount payable ;RM2,562.50

Savings for house purchaser ;RM2,562.50

b) Reducing withholding tax on dividends of Malaysia REITs to 10%

c) RM330m allocation for Jabatan Perumahan Negara to complete 4,400 units of Program Perumahan Rakyat (PPR) Disewa, 1,500 units of PPR Bersepadu and 600 units of PPR Dimiliki. In addition, Syarikat Perumahan Negara Berhad will build 33,000 low cost houses.

d) Increase the size of the Housing Credit Guarantee Scheme (SJKP) to RM100m from RM20m to assist those without fixed income to own affordable houses.

e) RM50 Million conservation funding for heritage buildings following the recent inscription of Malacca and George Town as historical cities of the Straits of Malacca under Unesco’s as World Heritage Sites(WHS). The Unesco listing of these two historical cities is expected to boost tourism and a boon to the property sector of these two cities.

For advisory on individual property investments, purchases and rentals of Penang Properties, email to us at Izrin & Tan Properties Sdn. Bhd. or call us at +604 6588333 (Penang Office) or +603 92839782 (Kuala Lumpur Office) and we would be pleased to assist.

Malaysian Budget 2008 and its impact on the property sector

Thursday, September 13th, 2007

Here are the highlights of the Budget 2008 relating to property sector tabled in Parliament by the Prime Minister of Malaysia on 7th September 2007 :-

a) EPF contributors can make monthly deductions from their EPF account to buy a house. The move will greatly benefit all the five million EPF contributors in the country and spur consumer led growth. Read more follow-up explanation by Second Finance Minister Tan Sri Nor Mohamed Yakcop on EPF withdrawals;

b) 50 Pct Stamp Duty Exemption For House Purchase costing not more than RM250,000. Purchasers can save up to RM2,000 being 50 percent stamp duty exemption on documents of transfer for the purchase of one house costing not more than RM250,000. Related link on Stamp duty payable;

c) Foreigners can take up to 70% stake in fund and REIT management firms;

The relevant appendices on the stamp duty exemption on purchase of residential property (Appendix 24), stamp duty exemption on transfer of real property between husband and wife (Appendix 26), stamp duty exemption for mergers and acquisitions of listed companies(Appendix 7), and tax treatment on transfer of building to REIT (Appendix 9) are available at Budget day Appendices.

And here are the comments on the impact of this budget on the residential property market especially on the release of about RM9.6 billion EPF fund annually to the five million EPF contributors - Higher sales forecast. More resources at The Star online on Malaysia budget 2008 and Economic report 2007/2008.

Update link : EPF announces details for housing loan monthly instalment withdrawal dated 14.12.2007.

For advisory on individual property needs, email to us at Izrin & Tan Properties Sdn. Bhd. or call us at +604 6588333 (Penang Office) or +603 92839782 (Kuala Lumpur Office) and we would be pleased to assist.

Penang’s skyline - Jelutong - Gelugor - Bayan Baru area. Many housing projects are taking off along this coastal area of Penang Island…

View of the landed homes at Bukit Gambier /Gelugor area.

Villa Emas Apartments at Bayan Baru area

Desa Palma in Bukit Mertajam

Upmarket condos at KLCC; Malaysia’s top real estate enclave

Tuesday, May 15th, 2007

Institution of Surveyors Malaysia (ISM) has recently organized a technical visit to Petronas Twin Towers (Skybridge). Members of ISM were given a short briefing on the construction of this magnificent world’s tallest twin towers with a guided tour to the 58.4 metre-long Skybridge at Level 42.

This iconic landmark of Malaysia boasts a modern 88-storey twin office towers with a total built-up area of 395,000 square metres or usable floor area of 213,750 square metres per tower. Situated in the KLCC on the northern boundary of the Multimedia Super Corridor (MSC), the towers have won Fiabci Malaysia top award under the category of special award for national contribution in year 2000 and Fiabci Prix d’Excellence 2002 Award (Office/Industrial Category).

KLCC remains the country’s top real estate enclave within the golden triangle of Kuala Lumpur. [Click here for location map of KLCC].This 100-acre mega development boasts a 50-acre landscaped park, a crescent-shaped shopping mall of Suria KLCC, a state of the art gallery and convention centre and a world class concert hall. In recent years, many high end super condominiums and service apartment developments have sprouted in the vicinity of KLCC. For more insights on these upmarket residential schemes, Intproperties.com has blogged and found that theedgedaily offers the most web information on KLCC developments. Notable upmarket condominiums in the vicinity of KLCC are Binjai, Avare or Avare in a class of its own, Dua Residency, Suria Stonoy, The Troika, myHabitat, Stonor Park, Ascott and Kirana, Marc Service Residence in Jalan Pinang area and developments along Kia Peng area.

The prices for upmarket condominiums in KLCC area seems to be on the uptrend, ranging from RM700 psf to RM1,500 psf. More related info on high end condo in KLCC area at Prices going up, up and away, property prices move up near KLCC area and Big demand for luxury condos.

For advisory on individual property needs and expatriate accommodation, please email to our Kuala Lumpur office or call +603 9283 9782 and we would be pleased to assist.

Snapshots of the Petronas Twin Towers and skyline of KLCC surrounding developments taken from the Skybridge during the visit.

The national icon of Malaysia - Petronas Twin Towers

View of the KLCC park

Skyline of KLCC area – south view

Skyline of KLCC area – north view

Fore more latest updates on KLCC condos, read more at Star online;
KL’s 10 most expensive condos;The Lure of KLCC and Fewer new projects as land costs escalate.

Relaxation on foreign purchase and abolishment of gains tax

Thursday, March 29th, 2007

Malaysia’s real estate sector is poised for vibrant growth and brighter outlook ahead following the recent two landmark measures announced by the Malaysian government; a) Relaxation of FIC ruling for foreign nationals to acquire properties in Malaysia after 21st December 2006 and b) abolishment of Real Property Gains Tax (RPGT), effective 1st April 2007.

Foreign nationals are allowed to buy residential properties worth more than RM250,000 per unit without the need of getting approval from the Foreign Investment Committee (FIC) of the Economic Planning Unit in the Prime Minister’s Department.

Malaysia’s property practitioners welcome the moves as it will promote a more active and vibrant property market. ACCCIM Hails Abolition Of RPGT whilst REHDA applauded the move that abolition of RPGT will spur the property market. It is expected to encourage more foreign investors to buy high end residential units in well-located areas of Klang Valley, Penang and Johor and attract more foreign nationals to sign up for MM2H programmes.

Though FIC approval is no longer needed, foreign nationals who wish to purchase properties in Malaysia are subject to application for consent of transfer of ownership to the relevant state’s land office or Land and Mines office and payment of application fees which varies for each state. As for Penang State, foreign buyers of Penang Properties are required to pay application fees ie RM1,000 for individuals or RM2,000 for companies within 30 days upon receiving approval. Verbal enquires with the Penang State Land and Mines Office as at 29th March 2007 revealed that the guidelines and application procedures for acquisition of Penang Properties by Foreign Nationals posted at the Penang State government’s website on 1st December 2005 is still applicable. Related link at relaxed rules boon for builders.

For more information on property investments in Penang and Kuala Lumpur, email your enquiries to us.

Listing of HEKTAR REIT

Thursday, November 16th, 2006

Hektar Goup has announced the listing of Hektar Real Estate Investment Fund (REIT) on the main board of Bursa Securities tentatively on 4th December 2006. Hektar Group is offering 159 million new reits at a retail price of RM1.05 per unit or indicative institutional price of RM1.11 per unit begining from 15 Nov 2005 to 22 Nov 2006.

Hektar REIT comprises of 2 retail / shopping complexes namely Subang Parade in Klang Valley and Mahkota Parade in Melaka. Both buildings have a total net lettable area of 944,000 square feet valued at RM523 million. The projected distribution yield is 8.00% to 8.80% per annum over the next 3 years. The prospectus of Hektar REIT can be downloaded here .

Izrin &Tan Properties Sdn Bhd (I &T) is the appointed Property Management Company (PMC) of Hektar REIT. Read more on PMC .

For more info on Hektar Reit, click here .