Anybody can tell more about the impact of the coming implementation of GST?
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Anybody can tell more about the impact of the coming implementation of GST?
For residential, the impact is only on new properties launching where the raw materials are subject to 6% GST.
For commercial, besides the impact described above, according kastam latest information, sales be individual owned commercial properties not more than 2 in a year will not require to include 6% GST on selling price. However, property owned by company is subject to GST. Hence, this created advantage for personal owned property owner as their selling price will be more attractive by 6%.
Please verify this fact as I am just sharing what I have learned from recent seminar briefed by kastam. Thanks
BR, Edmend
+6012-6892783
if i buy a subsale commercial property now, do i entitle for this 6% GST?
it depends, if you buy a commercial property from a seller who is required to collect GST (GST Registrant) then you have to pay extra 6% for the GST. Hence, ask the buyer whether he/she is required to collect the GST
This whole GST thing is so confusing. But yesterday, I've just spoken to someone who told me that GST does not affect property buyers and property sellers (owners) for both residential and commercial, UNLESS you are a developer. Cost of building materials will be charged GST, therefore developers will have to hike up the price of the new development and therefore, buyers buying at a higher price. Is this correct?
that's true but it is only on the new project perspective.
for sub-sale and commercial property, if the seller (personal or company) is the GST Registrant then all he/her property sale will subject to 6% GST. In addition, for personal who has sold more than 2 properties in a year, the 3rd commercial property onwards is subject to 6% GST
Oh! Correct me if I am wrong.
So, meaning GST will be subjected only to.....
1) People like business owners who wants to sell their house
2) People who owns their 3rd commercial property onwards
Hi Magdelin,
1) Residential properties are exempted from GST
2) The commercial properties sub sale of more than 3 units and above in a year will be subjected to GST. However, property investment company needs to pay GST regardless of number of property transacted
Thanks @vince2602 and @edmendchua for the clear explanation.
Come to think of it, actually this GST doesn't really have a big impact towards the property market, unless you are developer, business owner or if you own more than 2 commercial properties. Apart from that, it doesn't really affect ordinary people such as first time buyers or even sellers.
But why does people make a big fuss about how GST will affect the property market???
Some of the concerns from before -
Hi Mag, It is either called the cascading effects or chain reaction.
When the cost to the developer escalates, the cost will be passed to the property buyers.
When the property price on new launches rises, the prices on secondary market will rise too.
When those investors sell their commercial properties with higher price, and if it is successfully transacted, the owners of neighbouring lots will want to sell at the same price or higher too.
Logical?
@vince2602, ah yes, forgot to add on. And also affect property buyers who wants to buy new development (because developer hike up price). But this should not affect subsale market.
But subsale seller would eventually think they may sell their property at higher value. When everyone trying to sell at that higher price, this cause the property transaction drop and this is not healthy. For cash rich investor, they definitely can hold until someone else to buy the property.
This is really good news for commercial property owner, at least is not the case of making decision to sell or not to sell also a headache !
no gst when buying or selling , only when developer buying materials. Therefore , price increase.
gst is not good anyway
In my opinion, GST has great impact to all new property buyers. As for subsale, the greater impact goes to seller (who is GST registrant) of commercial property because buyer always has the choice to but from seller of non-GST registrant. Hence the GST registrant seller will eventually forced to push down the price to compete with the non-GST registrant seller
As for negotiator, it is important for us to share a constructive view, find a balance between seller and buyer. It's challenging but yet interesting
Regards
Edmend
GST is Malaysia's way of moving forward. Doesn't matter what you or I think, it's here to Stay. Best we can do is to educate ourselves and adapt to it.
@findjordantan88, GST has just been implemented not long ago. I guess people are still getting used to the pinch. After sometime, people will get used to it. It's the same for anything drastic is being implemented.
what is good about GST implementation (plus all the cooling measures that the government has implemented) is that market sentiment is badly affected. Property prices is moderating and in some cases reduced. There are opportunities to pick up some properties now....be it for own stay/use or investment.
GST has made the untouchable commercial properties especially shoplots even more untouchable now. Drew the distinction line between home buyers and shop buyers more clearer now!
Some developer after GST implementation on commercial units still try to make their commercial property attractive by offering "GST rebates"... Even though they have the right to upfront raise the selling price by 10% and then give the 6% GST "discount". I am seeing this trend now.
Dominic, which developers are currently offering that now?
@James Bob, please search the property development from my Display Picture... the commercial property is in Skudai, Johor. Slightly overpriced now. I think it was selling at Future (3 years) price....
Dominic, how much is an average unit? Could it be they've already included into the selling price??? :P
@james_bob
From RM1.6mil for 3 storey commercial...
@domng, 1.6mil for 3-storey sounds reasonable but perhaps not so since it's in Skudai.
@jordanchen1981 thanks for sharing
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