Will The DIBS Ban Cause More Properties To Get Auctioned In 2014?

In our last issue of GoodPlace Digest (#25 – click here to read), we have shared an article published at The Sun:-

More Properties To Go Under The Hammer?

Excerpted from that article was a prediction by HBA Secretary General Chang Kim Loong that there will be a flood of properties into the auction market due to the inability of buyers to service loans since DIBS is going away in 2014:-

“I will not be surprised if there will be a lot of properties for auction next year. I won’t be surprised because a lot of people who bought into properties for investment, they are now caught out with RPGT and DIBS,” he told SunBiz in an interview.

“So it now depends on your holding power. How long can you hold on to the property with the bank interest when the developer won’t be paying installments for you anymore? By next year there should be a lot of foreclosure cases,” he added.

This implies that the developers will stop servicing the loans post the banning of DIBS come January 1st, which then would result in buyers offloading the properties en masse.

Here’s an email from one of GoodPlace Digest readers Eddie Quek –

Query from a GoodPlace.my reader - will developers stop servicing DIBS loans in 2014?

Query from a GoodPlace.my reader – will developers stop servicing DIBS loans in 2014?

We have sent an email to HBA (info@hba.org.my) for clarification – will post an update here when we have received a reply.

Happy new year!

UPDATE February 4th, 2014: No luck with Chang Kim Loong; it’s HBA’s policy not to respond to emailed queries, apparently. Here’s the bog standard email that gets sent out:-

Chang Kim Loong

The templated email response we received from Mr Chang Kim Loong, the Hon Sec Gen of the HBA

Note the “Free Service For Nice People” footnote. Now if I had asked a little nicer, maybe I’d get a reply? 😉

About Khai Yin

When I am not writing for GoodPlace.my and helping my readers find properties though the DealMatcher service, I spend time doting on my three kids: Wenyi, Qinyi and Eian. My personal stuff, some published essays and contact details can be found at khaiyin.com

Comments

  1. I was wondering about the same thing myself. Is this ruling retroactive? I know it is for RPGT…

  2. chicken little says:

    Purely speculative at this point unless we see some real market data at this point. I do believe that the number of speculators is highly exaggerated, and the boom in the property prices is caused by genuine increase in demand. Look at places like SG and HK – we are mirroring them in every way.

    happy new year everyone!

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