Johor to impose development charge on property developers

Demand for houses in the secondary market is likely to go up this year in Iskandar Malaysia if prices of new houses continue to increase.

JOHOR BARU: The Johor government plans to impose a development charge on property projects carried out, in accordance with the provisions of Section 32 of the Town and Country Planning Act 1976 (Act 172). 

State Housing and Local Government Committee chairman Datuk Abd Latif Bandi said the matter was at the final stage of coordination before being presented to Mentri Besar Datuk Seri Mohamed Khaled Nordin. 

He said the charge would be levied on the applicant if a development project was approved for the conversion of land use, which changed the floor area, compactness and density, would raise its value. 

The purpose of the development charge is to accommodate provisions to provide and improve infrastructure and public facilities in the area, resulting from the approval given to the plan, he said after opening the Guidelines on Service Apartment Planning and Mixed Development in Johor 2016 in Johor Baru on Monday.

“The matter is still being discussed and we are taking the examples from other states that have long implemented the charge. We expect it to be implemented next year,” Abd Latif said. 

He said the charge rates would not give a big impact on the selling price of property units, instead it would benefit not only the local authorities, but also the developers, community and state. 

On Iskandar Malaysia’s service apartment development, he said although 26,677 units were earmarked until 2025, as at the end of the second quarter of this year, 95,150 units were already built, putting a strain on provisions for public facilities and affordable housing. - Bernama