PETALING JAYA: Second Finance Minister Johari Abdul Ghani plans to ask Prime Minister Najib Razak to reconsider the blanket ban imposed on luxury property developments, The Edge reported.
The ban came into effect Nov 1 and affects luxury property developments with units valued at above RM1 million.
The move was said to follow a Bank Negara Malaysia (BNM) report, warning that unsold residential properties were at a decade-high level.
BNM had said the glut could worsen if the current supply-demand conditions persisted. The report also noted that Johor would have the highest number of unsold residential properties and potentially the largest excess supply of retail space.
“As such, it is timely for all parties to act now to mitigate any potential risks to macroeconomic and financial stability,” BNM said.
According to Johari, the purpose of the ban was to deter companies who were “not serious property developers looking to make a quick buck”.
Johari was believed to be referring to companies in different sectors which had purchased land and were venturing into property development.
He said that other property developers had appealed to the government because of the high land costs in major urban areas.
“I will discuss with Prime Minister Najib Razak to allow, on a case-by-case basis, projects in areas such as Kuala Lumpur, Penang and Johor,” Johari told the financial daily after attending a function hosted by the Real Estate Development and Housing Association (Rehda) yesterday.
On Nov 19, Johari said that the ban would be nationwide, and was imposed because of Bank Negara Malaysia’s findings about the oversupply of high-end properties.
However, the very next day, Works Minister Fadillah Yusof said the directive was not a blanket freeze and that approvals would be evaluated on a case-by-case basis.
On Nov 21, Johari said the freeze would only affect projects that had not been approved and that the length of the freeze would depend on a continued assessment of the situation. -FMT
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