We have no say on property prices, says valuation dept

Property prices are usually determined by demand and supply, says the Valuation and Property Services Department. (Bernama pic)

PUTRAJAYA: The Valuation and Property Services Department (JPPH) does not have a say on property prices, including residential buildings, says its director-general Nordin Daharom.

Instead, he explained, the prices were usually determined by demand and supply, except for low-cost houses in the primary market (from developers), where the ceiling price had been fixed by the respective state authorities.

“Among the key components that are said to influence the costs of housing development are the costs of land and building materials. This burden is then reflected in the price of the house,” he said in a statement today.

Nordin said this in response to a news report which claimed that only JPPH could control the price of residential properties.

Nordin said that JPPH, which is under the finance ministry, played a role in announcing important indicators for the real estate market to keep the market under control.

He said the role of JPPH, via the National Property Information Centre (NAPIC), was to gather accurate, comprehensive and timely information, and to provide data on the demand and supply in real estate market to government agencies, property developers and other related parties in the industry, as well as the general public.

“With the dissemination of information on the real estate market from time to time, developers, buyers, and authorities that approve projects, in particular, housing projects, are kept abreast of the market’s situation,” he said.

Nordin said the components of a housing development scheme which could potentially contribute to an increase in home prices included costs of land, premiums, infrastructure development charges, contributions to utility providers (Tenaga Nasional, Syabas, Indah Water), building materials, bridging finance and end financing.

Insurance, labour, professional fees, developer profits, marketing techniques and marketing, advertising and marketing costs, developer deposits and compliance with planning requirements also contributed to higher prices of houses, he added.

Nordin said the National Housing Department under the housing and local government ministry should be able to regulate the price list, namely the minimum and maximum selling price.

He said this was because the checklist for applying for a new Advertising and Sales Permit outlined by the housing development licensing division under the National Housing Department required two items, namely the list of the selling prices for all housing units by type, and the setting of the minimum and maximum selling price for each type of house.

“This shows that the price list, as well as the minimum and maximum selling prices, should be able to be regulated by the department concerned,” he said.

On the exemption or imposition of the sales and services tax, Nordin said JPPH was of the view that some of the listed components should be reviewed in a more holistic manner.

“In this regard, there is a proposal to establish a Housing Cost and Price Committee to monitor the cost of development components to keep residential property prices under control,” he said, adding that the components were infrastructure, building materials, labour and percentage of developers’ profits.