This article first appeared in The Edge Financial Daily on July 27, 2017 - August 2, 2017

KUALA LUMPUR: Mah Sing Group Bhd has expressed support for the government’s proposal that a single regulatory body be set up to supervise the property sector in Malaysia.

“I think it’s a good move. The government is trying to address the issue of first-time homebuyers,” said the property developer’s executive director Datuk Steven Ng.

Second Finance Minister Datuk Seri Johari Abdul Ghani on Tuesday said the government is looking to establish a single authority to regulate the property sector, due in part to the need to address the issue of irregular pricing in the affordable housing segment.

Ng said it would be difficult to put a definite threshold for the affordability rate as property prices vary significantly according to locations.

“We are doing our part by making our products below RM500,000 in strategic locations. We also want to play a role to support the government’s initiative,” he told a press conference during Invest Malaysia 2017.

Ng said Mah Sing has been constantly in discussion with the government to address certain issues within the property sector.

The issues raised pertaining to the development of affordable housing include high land and compliance costs and tight lending requirements, he said.

“In order to develop affordable housing, a few things [need to be considered]; the land cost must be affordable. We also talked about the compliance cost, which is currently quite high. Lending requirements must also be relaxed,” he said.

Mah Sing chief executive officer Datuk Ho Hon Sang highlighted the issue of different compliance requirements from different local authorities, saying it is posing a problem for developers to manage costs in building affordable housing.

“It is good to standardise [the regulations], so that developers who embark on affordable housing will be able to forecast the cost structure,” he said.

Ng, meanwhile, proposed that the government’s initiatives, such as the 1Malaysia People’s Housing Programme step-up financing scheme, be applied as well to first-time buyers of affordable houses that are developed by the private sector.

On Mah Sing’s future plans, Ng said the group is actively looking for more land to acquire in the Klang Valley.

“Our focus is to increase our presence in [the] Klang Valley to 75% [of total land bank],” he said.

Ng said Mah Sing will continue to concentrate on affordable housing as it sees strong demand for the segment in the next few years.

“These products (affordable housing) will do well for the next two to three years. We just need the support of the banks to lend money to buyers so that they can own a home,” he said.

For the first quarter ended March 31, 2017, Mah Sing reported a 4.9% decline in net profit to RM90.42 million from RM95.04 million a year earlier. Earnings per share fell to 2.99 sen from 3.18 sen.

Quarterly revenue rose 2% to RM723.54 million from RM709.17 million.

Mah Sing’s share price closed unchanged at RM1.55 yesterday, giving it a market capitalisation of RM3.73 billion.