The RTO mechanism can uplift the sales of PR1MA units where the M40 group’s failure to secure bank loans
by AFIQ AZIZ / pic by MUHD AMIN NAHARUL
THE 1Malaysia People’s Housing Programme (PR1MA) rent-to-own (RTO) scheme for residential units to be launched in June is expected to give a better access to the middle 40% (M40) income group to purchase PR1MA houses.
Perbadanan PR1MA Malaysia chairman Datuk Seri Dr Shahidan Kassim said currently buyers, especially in the urban areas, find it hard to secure a loan for house purchase.
He said this is part of the contributing factor that has caused PR1MA to fail in generating sales.
“Why PR1MA posted loss is because the M40 group could not secure a loan with the bank, and this is where the RTO mechanism can uplift the sales of PR1MA units.
“It is not because there are no buyers, but because it is hard for them to get a loan,” Shahidan said in a media conference at PR1MA headquarters in Subang Jaya, Selangor, yesterday.
Shahidan, who was appointed as PR1MA chairman early this month said the RTO scheme will prioritise ready and developed houses.
As of now, he said PR1MA has 62 projects valued at RM14 billion which are ongoing throughout the nation.
As of March 31, a total of 20,587 units were completed and another 24,756 units were being constructed, while 7,420 units were at the planning stage, he added.
RTO, also known as rental purchase, or rent-to-buy essentially, is a “lease-purchase” agreement signed between the buyer and the developer, giving the buyer the option to buy the house at a specific future date after a certain period of renting.
On March 13, the Housing and Local Government (KPKT) Minister Datuk Zuraida Kamaruddin said the ministry was in the middle of discussions and refining the RTO housing scheme mechanism with banking institutions.
She said once the scheme is finalised, KPKT will offer the programme for PR1MA houses.
Earlier in November, the government included the RTO plan in the 2021 budget.
The government collaborates with selected financial institutions in providing the RTO scheme effective until 2022.
The programme would involve some 5,000 PR1MA homes nationwide with a total value of over RM1 billion, especially for first-time homebuyers.
On the same development, Shahidan said PR1MA plans to restart some 20 projects, which were stopped due to the rationalisation programme made during the Pakatan Harapan government time.
From the findings of the programme, a total of 32 sites of PR1MA project which started during the Barisan Nasional ruling in 2011, were not viable to be proceeded.
However, after re-evaluating all of the projects, Shahidan said PR1MA found 20 of those sites to have potential to be redeveloped, while PR1MA is also looking for alternative plan for the remaining 12 parcels.
“More details of the 20 projects will be announced later,” he added.
On “sick” projects like Residensi Tebrau in Johor and Melaka Tengah 2 in Melaka, Shahidan said PR1MA will continuously engage both buyers and contractors to ensure the projects could be completed as soon as possible.
“Residensi Tebrau 2 is in the process to be granted vacant possession and will be handed over to buyers by April 30, 2021, while for the Melaka Tengah 2, PR1MA is still looking for a new contractor to finish the project,” he said.
Read our previous report here