Create a high-wage society to level up property purchasing power

PETALING JAYA (Nov 2): To increase the property purchasing power of Malaysians, industries have to work together to create a high-wage society, said a panellist during a panel discussion at Rehda (Real Estate and Housing Developers’ Association) Institute's Budget Commentary 2017.

“One thing we should look at is how to create high-value added jobs. For the construction industry, you can look at Industrialised Building System (IBS) where you can create more high-skilled workers.

“The manufacturing and agriculture industry, the service sector, all these workers in these industries are facing low wage problems.

“Another group is graduates. There are so many graduates coming out from IPTA (Institut Pendidikan Tinggi Awam) and IPTS (Institut Pendidikan Tinggi Swasta).

“Jobs are not plenty and times are bad. At the local level, how we make sure that the cost of living is sustainable is to create a high-wage society and hopefully people then can buy good houses with their incomes because affordability is [made up of] both income and house prices,” said the director of research for Khazanah Research Institute Dr Suraya Ismail during a panel discussion entitled “Budget 2017: Impact on Affordable Homeownership and First Homebuyers” yesterday.

The panel discussion was moderated by Rehda president Datuk Seri Fateh Iskandar Mohamed Mansor with panellists including Rehda Malaysia vice-president Datuk Wan Hashimi Albakri Wan Ahmad Amin Jaffri, Perbadanan PR1MA Malaysia chief operating officer Datuk Ar. Aminuddin Abdul Manaf and Malaysian Institute Estate Agents (MIEA) president Erick Kho Ying Tian.

Suraya also noted that since 2000, 80% of the government’s budget have gone to operating expenditure while the remaining 20% is for development expenditure.

“It is not balanced. For instance, you are managing the household and you spent too much to operate it, it will not be sustainable.

“You must have budget for other assets in order to be sustainable. If you don’t spend on development, you will not create jobs, especially high skilled jobs,” she added.

On IBS, Wan Hashimi said the transition from conventional building to the new system will only happen when the entire ecosystem is ready for it.

“The key here is the supply chain of the ecosystem in this country is still not conducive for the practice of IBS. Then there is also the issue of logistics and transportation. It’s a collaboration with all stakeholders,” he said.

MIEA’s Kho agreed, noting that many think houses built with IBS are of lower quality, but it is actually a misconception.

IBS, or prefabrication as it is known elsewhere, is the practice of assembling components of a structure in a factory or other manufacturing sites, and transporting complete assemblies or sub-assemblies to the construction site where the structure is to be located.

Meanwhile, Rehda president Fateh agreed with the government’s call for developers to allocate at least 30% of their development portfolio for affordable housing.

“Rehda would want to propose the same thing. We’ve already said this: 30% of township has to be for affordable housing depending on the acreage,” he said.

Fateh added that there is a perception change among homebuyers nowadays.

“Now a lot of people the moment they buy [houses], they don’t want to be associated with low-cost homes. But if affordable homes that are priced up to RM300,000 and above, they don’t want [because they are too expensive].

“They [homebuyers] want the lifestyle. We definitely want to work with the government on this.

“But the challenge is that each state of has its own ratio for low-cost and affordable homes. If they are going to standardise this, definitely developers will support this move,” he added.