PUTRAJAYA (June 7): A coordinating committee comprising Syarikat Perumahan Negara Bhd (SPNB), 1Malaysia People’s Housing (PR1MA) and National Housing Department (JPN) will be formed to help facilitate the government’s goal of delivering a million affordable and low-cost homes to the public.
The joint committee will be chaired by newly appointed Urban Well-being, Housing and Local Government Minister Datuk Abdul Rahman Dahlan.
“We have decided that with the one million homes promised in the election manifesto, there must be better coordination among the major agencies at the federal level responsible for housing.
“My ministry will be the secretariat. The various agencies have different priorities altogether. JPN is looking at low-cost housing, while PR1MA is taking care of properties for those with a household income of RM2,500 to RM7,500,” he said.
Abdul Rahman said the government plans to deliver an average of 200,000 homes annually over the next five years.
“PR1MA itself is looking at 80,000 a year for the first year to slightly over 100,000 in the next year. JPN, if I am not mistaken, has to build around 30,000 units a year and [the rest will be built by] SPNB, other state agencies and the private sector,” he said.
The ministry also plans to go ahead with the implementation of the build-then-sell (BTS) scheme for all residential developments come 2015.
“It will disadvantage the smaller contractors, I understand that. The bigger developers have money, so they can build first then look for buyers later.
“But for the smaller developers they may not be able to cope. So we try to tell them, 'look, if you are small, don’t do [big developments]. Go in stages'. At the end of the day, there are 50,000 people affected [by abandoned housing], plus their families, that adds up to over 100,000 people. So there are a lot of people being harassed by the banks (to service their loans) and their lives have turned topsy-turvy because of this,” Abdul Rahman said.
However, when contacted, Real Estate and Housing Developers Association (Rehda) president Datuk Seri Michael Yam reiterated the association’s stand that the BTS scheme should not be the only development model as it is not financially viable for local developers to build enough homes to meet real demand.
“The progressive payment system is used by developers in the region, excluding Japan, because we are developing nations with a growing population who needs housing,” he told The Edge Financial Daily.
According to Yam, there is a supply of 100,000 new houses a year, while real demand is anywhere from 150,000 to 200,000.
Prices of houses will rise because of shrinking supply, resulting in developers dictating the market, he added.
Yam argued BTS was already available in the market in the form of secondary market properties which accounted for two-thirds of transactions last year.
This article first appeared in The Edge Financial Daily, on June 7, 2013.