KUALA LUMPUR: A proposal to provide up to RM30,000 in deposit assistance for first-time homebuyers under the MADANI deposit initiative is unlikely to lead to a significant increase in property prices.

Tan Ka Leong, group managing director of CBRE | WTW, said that by lowering the initial financial barrier, this initiative could help address the issue of unsold properties, particularly in the affordable segment.

"Many of these unsold properties fall within the price range that is now more accessible due to this kind of financial support," he told Business Times.

Housing and Local Government Minister Nga Kor Ming recently stated that the Madani Deposit initiative aims to ease the monthly payment burden for first-time buyers, especially young purchasers in the B40 and M40 income groups.

Tan praised the initiative, noting that it will make homeownership more accessible for lower-income groups.

He described it as a reintroduction of earlier efforts, such as the MyDeposit Scheme and My First Home Scheme, which were designed to lower the financial barriers to homeownership for those in need.

"These programmes have helped thousands of Malaysians purchase their first homes without causing a significant spike in property prices. Instead, they provided much-needed support for prospective homeowners, particularly in urban areas where property prices can be daunting.

"The main outcome of these initiatives was not inflated prices but rather a greater accessibility to homeownership for young families and individuals in the B40 and M40 categories," said Tan.

The Real Estate and Housing Developers' Association (REHDA) shares this view, believing that if effectively implemented, the initiative will help reduce the financial burden on many struggling to buy a home.

This includes the low-income groups and youths who have just started their career and are still finding their footing and putting down their roots, said its president, Datuk Ho Hon Sang.

"In fact, the association has suggested a similar idea for several years, most recently in our engagements on Budget 2025 with the government.

"While final details of this initiative have yet to be released, we believe that this Madani Deposit can and should only be applied to controlled priced affordable housing and therefore will have no impact on the pricing of affordable housing," he said.

Ho described the initiative as a strategic move by KPKT, noting that it would significantly assist deserving households struggling with down payments.

"We have received previous feedback that there are many keen and deserving households that struggle with the down payment for these Madani homes, which REHDA members have been providing the Rakyat for the past 40 years. This Madani deposit will go a long way to help the deserving Rakyat to own their own homes," he said.

Sr. Samuel Tan echoed REHDA's support, adding that the initiative will assist those who face challenges in raising the initial capital for their first home purchase.

However, he cautioned that the grant must be allocated prudently and selectively, stressing that only those who can service their loans should be eligible to avoid creating a financial burden.

He also warned of the potential for developers to exploit the initiative, underscoring the need for clear guidelines and careful monitoring of its implementation.