This is to clear the stock of unsold affordable housing units in Malaysia, says think tank
By ALIFAH ZAINUDDIN / Pic By TMR
The government should consider adopting state-based policies to clear the stock of unsold affordable homes in the country, said local think tank Khazanah Research Institute (KRI).
KRI director of research Dr Suraya Ismail said the number of unsold affordable housing units in Malaysia pointed to an ineffective policy that did not reflect the realities on the ground.
“If you put RM180,000 as a price for affordable housing in Selangor, it is already not affordable for the people in Kelantan.
“We tend to think that everyone lives in the same reality. There is only one benchmark and one number, and this is the problem with affordable housing.
“You cannot be crafting policies without taking into account the limitation of the execution,” she said at the launch of KRI’s latest report titled “The State of Households 2018: Different Realities” in Kuala Lumpur (KL) yesterday.
The high prices of houses and non-strategic locations of newly built units under the government’s affordable housing scheme have resulted in a rise of unsold residential properties in recent years.
Data from the National Property Information Centre (Napic) revealed a 40% increase in the number of unsold and completed residential properties in the first quarter of 2018 (1Q18) to 34,532 units worth RM22.67 billion from 24,738 units amounting to RM15.64 billion recorded at the end of last year.
The study shows that while the national median income level hovers between RM4,360 and RM9,619, the middle income threshold is different in each state.
For example, a top 20% household in Kelantan, Perlis or Pahang may have incomes similar to a bottom 40% household in KL.
As such, KRI said a one-size-fits-all approach towards public policy on affordable housing and other areas will be a gross over-generalisation of the diverse set of household income thresholds in the different states in Malaysia.
“Now that we have granular state-by-state levels of income, I think government policies should take into consideration the different incomes and different affordability rates.
“It should not be just one policy or one number (for affordable housing). The government could group certain states as middle-income states and take building material costs into consideration as well,” KRI executive committee chairman Datuk Hisham Hamdan said.
The report also stated that households with incomes below RM2,000 consume 95% of their income on average and those with incomes below RM5,000 have to cut back on their food consumption.
In contrast, households with incomes above RM5,000 spent more on non-essentials such as recreational activities, cultural services and food consumed outside of their home.
Commenting on the report, Khazanah Nasional Bhd MD Datuk Shahril Ridza Ridzuan hopes the government will be mindful of the realities portrayed in the report in preparing for the upcoming Budget 2019 and build policies that have longer-reaching consequences.