The government’s proposal to relax the housing loan guidelines for first-time house buyers, if not thoroughly thought out, could only worsen the current property market glut.
The Institute for Democracy and Economic Affairs (Ideas) said easing up the loan process, especially to assist the low- and middle-income earners, “may not be a move in the right direction”.
“Tackling this problem from the demand side by promoting credit policy is not viable and may worsen the problem. Every sector in the economy will experience business cycles and the property market in Malaysia right now is at the stage of contraction,” said Ideas senior fellow Dr Carmelo Ferlito in a statement.
