by Dato' Chris Chin
Pursuant to the announcement of Budget 2017 by our Prime Minister Datuk Seri Najib Razak on 21.10.2017, First-Time Home Owners can enjoy a great advantage to own their first home as they will enjoy 100% stamp duty exemption on the instrument of transfer (MOT) and loan agreement for first home at the maximum value of RM300,000.00 .
First Home Valued between RM300,000.00 to RM500,000.00
For first home valued between RM300,000.00 to RM500,000.00, the stamp duty exemption will only be given to the first RM300,000.00 and the remaining balance of the value of the residential home is subject to the prevailing stamp duty rates.
With the implementation of 100% full stamp duty exemption I would say that it is the time to own your first home as this will lift the burden of first time home owners. It is not advisable for first time home owners to make any purchase at this moment until 1.1.2017 because they would only enjoy a 50% tax stamp duty redemption, compare to a full stamp duty exemption commencing on 1.1.2017 to 31.12.2018.
Let’s look at Figure 1 below to understand how a Full Stamp Duty Exemption will save cost for first time home owners:-
Are You Eligible?
The full stamp duty exemption is only available to any individual who has never owned (whether invidiually or jointly) any residential house either by way of purchase, inheritance or received as gift. I believe next year is a great opportunity for the first time home owners to purchase their first home with the full stamp duty exemption especially coupled with aggressive marketing & promotion plans pushed by the developers to boost sales in such slow market.
Nevertheless, first time home owners shall not take the exemption as the main consideration to jump into the property market recklessly as a proper and sound financial plannning is vital. You must ensure that you are able to afford the repayment and commitments, before making decision to bear the housing loan for decades.