Moneylending scheme for developers may be hard to implement: MIEA Johor

JOHOR BARU: The Malaysian Institute of Estate Agent (MIEA), Johor branch is of the view that the proposal to allow property developers to give out loans to buyers at an interest rate of between 12% and 18% is not feasible as buyers will have to pay more at the end of the day.
Its branch chairman Liew Toh Sen told theSun he wonders how the Urban Wellbeing, Housing and Local Government Minister came up with the idea when it is just going to burden the buyers and not help the sluggish sales of property market.
He said the core business of property developers is to construct houses and they do not have expertise in furnishing loans to buyers.
"To solve the sluggish property market, Bank Negara need to review and make relaxation for the restriction on housing loan regulation. Currently, first and second time buyers can enjoy up to 90% housing loans while the third time buyer only get 70%," he added.
He said if Bank Negara can relax the restrictions, the market will bounce back.
Meanwhile, Johor Baru Tiong Hua Association president Datuk Seri Tey Kim Chai said although the proposal seemed good but difficult to implement.
He said there are some basic problems to be resolved as there have been many cases of people not repaying their loans, what more if the interest rate is high.
"We need to educate our borrowers on the importance of repaying their loans promptly. If they do, then it helps create a healthy lending business. if they do not pay, then it hurts the whole industry," he added.
He said the government need to study the proposal carefully including putting in place some legal frame work to ensure the lending industry also have the same protective measures as banks.