Relax ruling on DIBS for first home buyers

KUALA LUMPUR: Tan & Tan Developments Bhd, a wholly-owned subsidiary of IGB Corp Bhd, hopes the government will relax the ruling on Developer Interest Bearing Scheme (DIBS) for first time home buyers in the upcoming 2015 Budget.
"I think the DIBS ban should be maintained for the speculators but for first home buyers, it should be relaxed because first home buyers are the ones that are really finding it very difficult to get loans. Looking at the people buying below RM300,000, I think it's pretty tough for them," its CEO Tan Boon Lee told reporters at the sidelines of the Tan & Tan and MJR Investment Pte Ltd signing ceremony yesterday.
On the Selangor state government's new ruling on the floor price for foreign purchasers, Tan said he is surprised with the huge jump from RM1 million to RM2 million minimum price for properties sold to foreign purchasers in certain zones within the state.
"That's a very odd ruling, that one. Maybe it drives more sales to Kuala Lumpur. RM2 million to RM3 million is quite hefty for foreigners to pay for outside the Klang Valley. I'm also just digesting that and I'm a bit surprised with that announcement.
"IGB itself will not be impacted (by the new ruling) because 85% of its income stream comes from recurring income from hotels, offices or retail. Tan & Tan is the icing on the cake, we come in to top up the cake in good times. That's the strategy we have at IGB. We will not be forced to do developments just for the sake of trying to get the numbers up year-on-year," he added.
For the build-then-sell (BTS) system that the government has yet to implement, Tan said smaller developers will be at a disadvantage if the system is implemented while bigger development companies with bigger funding and financial standing will stand to gain.
"Apart from that, I think interest rates will probably be maintained so that's good for us as well."