PRICES OF AFFORDABLE HOUSING IS THE MAJOR CAUSE OF MANY UNSOLD UNITS

PRICES OF AFFORDABLE HOUSING IS THE MAJOR CAUSE OF MANY UNSOLD UNITS

PRESS STATEMENT BY

GERAKAN NATIONAL PRESIDENT

DATUK DR DOMINIC LAU HOE CHAI

JANUARY 29, 2019

 

Gerakan National President, Datuk Dr. Dominic Lau Hoe Chai voiced his reservation towards the announcement of a mega Home Ownership Expo by the Housing and Local Government Ministry (KPKT). He said that this measure is only a stop-gap measure to stimulate the housing market but does not tackle the fundamental issue on the ground.

“First of all, while the intention of the government is good in enabling more Malaysians to own their dream home, the main issue is the price of these affordable houses itself.”

He added that simply offering discounts up to 10% is akin to making this expo look like a garage sale where everything must be sold out to clear out the backlog. Is there any consideration on what implications it might bring to the average Malaysian and the economy?

“Our household debt is already among the highest in the region at 83.2% and 52.8% of this debt itself is being used to buy a house. This is against the widely recommendation that housing debt should not exceed 1/3 of a person’s salary.”

Also, the major problem for many vacant units was not due to the lack of interest but due to the dichotomy between the price and salary earned by Malaysians which made the majority of the housing loans being rejected.

However, Dominic pointed out, a Basic Amenities Survey in 2016 by the Department of Statistics showed that B40 households can only afford home prices up to RM 108,000 each while middle 40% can only afford homes up to RM 225,000. Plus, the median monthly salaries and wages received by employees for 2017 was at RM 2,160 which is still under the B40 category assuming only one spouse is working which means that even a RM 150,000 home is out of reach.

“The government should also consider introducing the concept of Basic Housing or introduce a quota to build more of these houses. In the concept of Basis or Barebone Housing, all opulent features and designs are stripped with only the basic features being retained. By retaining only the basic features, this will lower the prices of these houses.

Finally, he opine that the government should reduce the price of housing and construct real 'affordable housing', enabling the rakyat to own their dream house in addition to increasing the stamp duty on foreign buyers while abolishing the 5% RPGT currently imposed on Malaysians.

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