(AFP) - The government was urged today to help ease a slump in the ailing property sector by revising gains tax and relaxing rules for foreign investors.

International property consultants CH Williams Talhar and Wong noted the 2002 budget unveiled last month did not contain "goodies" to alleviate slowing sales and an overhang in the property sector.

Company director Goh Tian Sui attributed the property overhang to the "euphoria of the heyday" of the early to mid-1990s when developers built without carrying out proper studies.

"The government through planning and land authorities can play a moderating role in requiring that a formal market or feasibility study accompany an application for development, conversion of land use or subdivision," he said in a statement.

"Additionally, the government should consider granting tax exemptions on interest paid for housing loans for owner-ccupied properties."

Goh called for further relaxation of property ownership regulations by the Foreign Investment Committee to woo foreign investors and for rates of real property gains tax for both locals and foreigners to be reviewed.

"As any chances of an early recovery in the real estate sector is now slim especially in the wake of the recent events in the US and Afghanistan, any help that the sector could get from any source would go a long way in alleviating the current situation," he added.

The government last month revised downwards its 2001 economic growth forecast for a second time to 1.0-2.0 percent because of the "greater-than-expected" slowdown in the world economy.