PUTRAJAYA: The government will allow housing projects worth more than RM1 million in big cities if they meet the requirements set by the Urban Well-being, Housing and Local Government Ministry.
Its minister Tan Sri Noh Omar said approval would be given to the developers on a 'case by case' basis until the temporary ban on high-end properties was lifted.
"Developers who want to undertake or build houses more than RM1 million at their choice of location in the city must write in an official application to the ministry.
"The approval of the project will depend on the need for the development in that area, the number of houses worth more than RM1 million which are sold or not sold in the area of request, and whether the appeal or application is suitable," he told reporters today.
A special committee at the ministry would be established to study and approve applications from developers.
He said Prime Minister Datuk Seri Najib Razak had appointed five ministers to discuss and deliberate matters following the ban on high-end properties in the country by the Cabinet.
"They are Second Finance Minister Datuk Seri Johari Abdul Ghani, Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor, Minister in the Prime Miniter's Department Datuk Seri Abdul Rahman Dahlan,Works Minister Datuk Seri Fadillah Yusof and myself. "
Johari said on Nov 19 that the government had frozen approvals for luxury property developments from Nov 1.
This was to control the oversupply of luxury projects from adversely affecting the economy. Therefore the cabinet decided to temporarily stop the development of shopping malls, commercial complexes and condominiums whose units were sold for above RM1 million, he added.
Noh said after discussing and receiving feedbacks from various bodies including Real Estate and Housing Developers' Association Malaysia (Rehda) following the ban, the ministers decided the ban would continue for the development of shopping malls and office spaces but leniency would be given to housing projects.
"We have decided that leniency will be given to only housing projects above RM1 million after our discussion last week. This is also after considering that purchases of houses above RM1 million in the city centre are by foreigners mostly.
"I brought forward the move to prime minister (Najib) yesterday and he has given his approval," he added.
The ban came about after Bank Negara Malaysia (BNM)'s quarterly bulletin published last month that the total unsold residential properties for the first quarter of 2017 (1Q17) stood at 130,690 units, the highest recorded in a decade.
Eighty-three per cent unsold units were in the above RM250,000 price range, 61 per cent were high-rise properties, out of which 83 perc ent were priced above RM250,000.
BNM also stressed that severe property market imbalances could pose risks to the macroeconomic and financial stability.
Earlier, Noh also received a courtesy call from Republic of Mauritius vice prime minister and Local Government and Outer Islands minister Fazila Jeewa Daureawoo.