Budget 2024: What you need to know about housing and development

• With a total of RM393.8 billion allocated towards driving development and economic growth, will the Madani budget be the gift that keeps on giving?

KUALA LUMPUR (Oct 13): In the newly announced Budget 2024 Madani, themed "Madani Economy: Empowering the People" the government has allocated a total of RM393.8 billion, reflecting a slight increase from the previous budget of RM388.1 billion set in February 2023.

The government looks committed to driving the New Industrial Master Plan 2030 (NIMP) mission, earmarking up to 10% of the total NIMP investment (RM95 billion) for this purpose, starting with an initial fund of RM200 million in 2024.

Interesting to note, too, that a sum of RM20 million has been allocated to Think City to rejuvenate and revitalise downtown Kuala Lumpur into a creative capital. 

Other property highlights not to be missed:

Sick and abandoned projects 

This year, the government has mobilised a special task force under the Local Government Development Ministry (KPKT) to solve the problem of late, sick and abandoned private housing projects. As of August, 256 sick housing projects comprising 28,000 housing units have been restored, involving a gross development value of RM23.37 billion.

On top of that, a “special guarantee fund” amounting to RM1 billion is allocated to incentivise reputable developers to revive selected abandoned projects.

Public housing 

1) RM2.47 billion has been allocated for public housing projects (PPRs) in 2024, out of which RM546 million is allocated to sustain 36 PPRs, including a new project in Kluang, Johor. There are 15 more PPRs targeted for completion in the coming year, benefiting 5,100 residents.

2) RM385 million is allocated for the construction of 14 affordable housing projects (Program Rumah Mesra Rakyat), involving 3,500 housing units.

3) RM460 million is allocated to aid 65,000 underprivileged individuals for building new or repairing worn-out house units in rural areas 

4) RM100 million is allocated to maintain low- and medium-cost stratified public and private housing nationwide. This will cover repair works on water tanks, roofs, wiring systems and security such as installation of CCTV.

5) RM100 million is allocated to upgrading the infrastructure and community facilities in Chinese New Villages.

6) RM2.4 billion is earmarked to construct, improve and maintain the housing facilities for civil servants, teachers, hospitals, and the police, army and fire brigade forces under the The Special Task Force on Agency Reform (STAR). 

7) RM400 million is allocated to maintain and repair all Armed Forces' Family Housing.

8) Permodalan Nasional Bhd (PNB) is set to manage Pelaburan Hartanah Bhd, supported by the government’s strategic land injection for housing projects in Kuala Lumpur.

Senior living care facilities 

Private nursing homes approved by the Ministry of Health will receive an industrial building allowance equivalent to 10% of the total construction expenses for either building new facilities or making modifications and improvements. 

Stamp duties on property transactions 

1) Currently, the stamp duty for transfer of properties between parents and children, and grandparents and grandchildren, is fully exempted for the first RM1 million and given a 50% discount (subject to an valorem duty rate) for the balance above RM1 million.

In 2024, a fixed stamp duty fee of RM10 will be introduced to replace the previous variable rate for real estate transfer documents. This change will apply to cases where beneficiaries are relinquishing their rights to eligible beneficiaries in accordance with a will, Faraid, or the Distribution Act 1958.

2) As a move in controlling property price, the government plans to impose a 4% flat rate stamp duty on memorandum of transfers on purchases by foreign individuals and companies except for permanent residents.

Housing Credit Guarantee Scheme 

In 2023, the scheme received RM5 billion in funding to assist up to 20,000 borrowers with no fixed income from the gig economy in obtaining loans. 

Come 2024, an allocation of RM10 billion will be provided to expand the Housing Credit Guarantee Scheme, benefiting 40,000 borrowers in this category.

En-bloc sale 

To facilitate the redevelopment of strata schemes, the residents' approval threshold for en-bloc sales will be reduced from 100% to a level consistent with international practices, as seen in Singapore. This change aims to promote urban renewal and encourage the redevelopment of old buildings in cities.

Development of Bandar Malaysia

Under the Unity Government, the development of Bandar Malaysia is being undertaken to optimise strategic lands for people-centric projects based on Madani values, including affordable housing for veterans and considerations for Bumiputera interests in the federal territories. The plan also includes the creation of parks and green spaces accessible to all residents in the Klang Valley.

Easing conditions of MM2H 

The government has decided to ease the current conditions for Malaysia My Second Home (MM2H) applications to boost the arrival of foreign tourists and investors into Malaysia. 

High-tech industrial development up north

To boost foreign investment, the government plans to establish a high-tech industrial hub in Kerian, North Perak, to expand the electronics and electrical (E&E) cluster eco-system in the northern region.

This complements existing industrial areas in Bayan Lepas, Penang, and Kulim Hi-Tech Park, Kedah, which have attracted E&E sector investments.

Public amenities
A total of RM110 million will be allocated to revitalise 150 local authority areas to repair and enhance deteriorating hawker centres and public market infrastructure. 

Cleanliness is of utmost priority, with RM10 million allocated to enhance 10,000 stalls and small businesses, and RM50 million to build 4,000 units of new commercial space.

The government also agrees to waive kiosk rental fees for the first six months for business operators.

And of course, public toilets nationwide will get a boost of RM150 million to equip 150 local authorities on refurbishments.

Countering climate change with flood mitigation efforts

1) An allocation of RM11.8 billion goes to 33 high-priority flood mitigation projects, such as those at Sungai Pahang, Sungai Langat Phase 2, and Sungai Likas. 

2) Additionally, RM300 million will be allocated to the Natural Disaster Management Agency (Nadma), with RM100 million designated for flood mitigation efforts. 

3) The acceptance letters (SST) for 24 projects, totaling RM5.1 billion, will be issued from October this year, and the rest will be released in the first quarter of 2024.

Sustainable development goals 

1) Putrajaya will lead the way as a green city model for Malaysia. Solar panels will be added to government buildings in partnership with Tenaga Nasional Bhd (TNB) and Gentari. The government will also use electric vehicles (EVs) for official purposes. TNB, Gentari, and Tesla are investing over RM170 million to create charging stations for EVs.

2) There will be a RM2 billion allocation for the National Energy Transition funds, alongside a significant RM200 billion fund to incentivise industries to transition to a low-carbon economy.

3) The Net Energy Metering (NEM) program will be extended until Dec 31, 2024 to promote solar panel adoption. 

4) The government is also working on a programme for buying back solar energy from rooftop installations with minimal costs to the system. At the same time, the government encourages companies to offer a "Zero Capital Cost" subscription model, similar to what Gentari is offering for residential homes.

Electric vehicles 

1) To encourage people with annual incomes of RM120,000 or lower to use electric motorcycles, rebates of up to RM2,400 is available through the Electric Motorcycle Use Promotion Scheme.

2) Tax rebates for EV vehicle rentals have been extended for an additional two years.

3) Individuals investing in EV charging ports can also benefit from income tax exemptions of up to RM2,500 for four years.

4) 150 electric buses will be rolled out by Prasarana Malaysia Bhd, which will also construct three new bus depots with a budget of RM600 million.

Tourism – 2026 is Visit Malaysia Year 

Malaysia is gearing up to welcome 26.1 million foreign tourists in 2026, who will bring in an estimated domestic spending of RM97.6 billion. 

RM350 million is allocated to boost tourism activities in Malaysia with RM80m allocated to maintain Unesco heritage sites like Gua Niah, Sarawak, Lembah Bujang in Kedah, and Royal Belum Perak.

The bottom line

Datuk Seri Anwar Ibrahim’s government seems cognisant of the fact that many issues impact the quality of life of the Malaysian on the street, the ordinary Ali, Ah Kau and Muthu. Yes, how many ringgits we have in our wallets and bank accounts are important but the upkeep of our homes and the amenities and infrastructure around them play an important role in boosting the “quality of life”. 

A decaying urban landscape and citizens beaten down by “poor surroundings” are a recipe for many social problems and this Madani Budget 2024 seems to have poured out the resources to prevent such a fate.

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