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Tuesday, August 08, 2006

Global Warming and Local Consequences

The weather has been pretty warm lately and so the authorities in Johor have decided to freeze land deals in the South Johor Corridor while they put on their thinking caps on how to deal with the multi-billion ringgit windfall that is an important component of the 9MP.

They fear that land prices will escalate and make millionaires of some fortunate owners. Maybe they want to impose some Coliseum Cinema type deals so that some owners will not even be able to enjoy the fruit of their investments.

In other words some people will get shafted in the interest of the nation’s progress.
This land freeze is similar to the exercise that took place before the NAP was formulated and even now the effects of that can be seen in the dwindling car sales and second-hand dealers dying a quick death.

We should accept that there is always an element of speculation in the property market and the authorities should not discourage it. They should only advise property owners that the 9MP should see a greater demand for such properties and encourage those who have staying power to hold on.

The last thing we should see is the state authorities trying to “talk up” prices just like they did to the Johor Unit Trust fund that was a major calamity.

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