Rehda Institute chairman sees obstacles to P2P homeownership scheme

PETALING JAYA: The peer-to-peer framework is a hybrid of home ownership scheme and a property investment scheme, said Rehda institute.

Chairman Datuk Jeffrey Ng Tiong Lip said there are a few challenges ahead, the uppermost in his mind being the 20% down payment.

"The initiative is targeted at first-time buyers for properties between RM300,000 and RM500,000. We foresee a problem with downpayment if it is between RM60,000 and RM100 000. 

"A 10% down payment is ready a huge hindrance, so will the target group be able to participate? 

"Secondly, risk versus benefit. At the end of five years,the participant will have to either sell , top up the 20% value according to a market value/ refinance the house to fund the other 80%, " Ng said at the Asian Tiger Budget Commentary 2019.

He said a more balanced risk/benefit treatment between buyers and investors because buyers may lose their downpayment in a market downturn but will not gain if capital appreciation is not more than 20% over the next five years.

"However, investors will get 100% of the first 20% gain upside and will not lose in the event of 20% depreciation in value," Ng said.