Low Yat Group, one of the pioneers in Malaysia’s property and hospitality industries, considers the Budget 2019 presented on Friday as a key tool in improving Malaysia’s economic wellbeing while overcoming inherited debts from the past government.
The Group’s Executive Director, Low Su Ming commented, “This is a good head start given the underlying challenges faced by our new government. I am pleased that the government didn't present an austerity budget even though the government finances are stretched. The rakyat's income will increase only with an improving economy and the aids handed out are also more targeted to ensure misappropriation is avoided.”
Home Fund & RPGT
“The RM 1.5 billion fund will not boost the property market as other variables like interest rates, major shifts in demographics of townships and the economy have an impact on the market as well.
But the fund will assist those in the lower income bracket to own homes and property, as we know real estate is always a sound investment option,” added Ms. Low.
Meanwhile, the stamp duty exemptions for first time home buyers who purchase homes up RM 500k is welcomed by Low Yat Group as seasoned players in the industry. This move will spur the property market and reduce inventory in the long run.
While the increase of RPGT may seem like a tough decision for the market, it should not deter serious buyers from purchasing good property in prime locations.
In relation to the Airport REITs, the Low Yat Group believes that despite the creativity of this announcement as securitization of government assets, the proof is in the implementation and strategies moving forward in developing our airports to reflect its position as a key entry point into the country.
“This is a positive move and the government can reduce its financial burden for airport developments but the strategies for development must be consistent and scalable so the REITs remain attractive to investors,” commented Ms. Low.
Low Yat Group is glad that the LRT3 and MRT2 projects are going to resume but with better savings for the government.
“Connectivity spurs development. The wider coverage provided by the LRT3 and MRT2 will certainly boost ridership for both locals and tourists. As a key player in the hospitality industry, especially in the Golden Triangle, we also feel that the move to introduce unlimited ride monthly pass would definitely benefit the rakyat.
We would be happy to see more Malaysians spend time in the city instead of avoiding it due to traffic congestion,” enthused Ms. Low.
However, the Group as a key hospitality player faces some challenges which affect the industry. It was expecting some measures for the tourism industry to be included in the Budget but can understand the Government’s need to address immediate problems like building the rakyat’s income and improving the nation’s economy.
As a major contributor to the nation’s income, the hospitality industry is currently affected by unregulated short term stays and over-saturation of accommodation inventory. This trend is pressuring average room rates to continue to be very low in KL as compared to other regional cities.
“Short term stays has to be regulated to curb oversupply of accommodation in the hospitality and tourism industries.
We also need to change the conversations the world is having about Malaysia from corruption and persecutions to more positive tones of achievements and uplifting news so our tourism can be boosted. Tourism Malaysia should be the driving force to leverage on the massive value that Malaysia has as a tourist destination because tourism is a major revenue source for the country.
Malaysia’s unique appeal is beyond slogans. We need a fresh perspective from the government vehicles for tourism. Our tourism should promote our national spirit and culture while appealing to the young Malaysians, who in the age of digital communications, become brand ambassadors of the nation to a global audience,” opined Ms. Low
The Group is looking to engage the government and local council on these matters moving forward into 2019.
“As part of corporate Malaysia, Low Yat Group is keen to observe the implementation of the 2019 Budget measures. The desired impact of any initiative undertaken by the Government can only be truly experienced by Malaysians if it is delivered as promised within the timeline stipulated,” concluded Ms. Low.