By ALIFAH ZAINUDDIN & DASHVEENJIT KAUR / Pic By MUHD AMIN NAHARUL

The government is conducting assessments on pieces of land offered by state governments to be used for affordable housing projects, said Housing and Local Government Minister Zuraida Kamaruddin (picture).

Zuraida said the ministry will determine the suitability of the land plots offered by each state before it issues a request for proposal (RFP) for the respective areas.

“The ministry is currently conducting site visits to ensure that the land plots picked to build these homes are suitable in terms of its location and the surrounding infrastructure,” she told the Dewan Rakyat yesterday.

Zuraida was responding to a question by Tanjong Karang MP Tan Sri Noh Omar who asked whether the federal government is able to obtain state government land for affordable housing purposes.

Zuraida said the government has so far issued RFPs for three housing projects on land offered by the state.

She, however, did not disclose the location or size of the land plots, but said the priority now is to develop the state-offered land parcels that measured more than 10 acres (4.05ha).

Zuraida said the federal government has received land plots with sizes as small as three acres up to 10 acres from several state governments, including Terengganu and Kedah.

In order to build between 500 and 800 affordable homes on each land parcel, Zuraida said each development needs at least 10 acres of land to be allocated for the project. She said bigger land plots would allow room for the development of a township.

Escalating land prices have been a key concern raised by property developers in building affordable units. Land accounts for nearly 20% of development cost, while labour accounts for another 10%-15% and compliance cost can range between 20% and 25%.

Under the National Housing Policy 2018-2025, the government has set a target to develop up to 100,000 units of affordable homes annually between now and 2025, at prices below RM300,000.

Among measures taken to keep home prices low, Zuraida said the ministry has requested utility companies, such as Tenaga Nasional Bhd and Telekom Malaysia Bhd, to absorb the development cost for utility infrastructures.

Others include the exemption of Sales and Services Tax for building materials and the use of industrial building system which has proven to be cheaper and faster.