Housing loans growth to remain stable, Dewan Rakyat told

KUALA LUMPUR: Housing loans growth  to remain stable following the implementation of various projects under the government's Economic Transformation Programme (ETP, the Dewan Rakyat was told on April 6

The massive programme involving 313 projects is expected to boost the people's income and retain their purchasing power to own houses, said Deputy Finance Minister Datuk Donald Lim Siang Chai.

He said household repayment capacity increased by 13.1 per cent last year, an increase of 2.38 times of total household debt as compared with 2.37 times in 2009.

Household asset liquidity, covering 65 per cent of the total financial asset, had also remained adequate, with the asset liquidity ratio and household debt at a comfortable level -- 153.9 per cent last year vis-a-vis 150.9 per cent in 2009," he said when replying to Muhammad Husain (PAS-Pasir Puteh) during question time.

Muhammad had asked what was the total housing debt in the country and future projection of the people's housing debt burden with the hike in the housing construction costs.

Lim said the low amount of non-performing loans (NPLs) at RM11.2 billion or 2.3 per cent last year compared with RM13.3 billion in 2009 or 3.1 per cent showed housebuyers could afford to repay their housing loans.

House price recorded a growth of between 1.5 per cent and 6.2 per cent in 2008 till the third quarter of last year.
Increase in the prices of bricks, iron and steel and land cost influenced the prices, he said.

"Even with the higher house prices, loan growth for residential units remained stable between 26.2 per cent and 27.5 per cent from 2006 till last year," he said.

Total loans for property purchases as at end of February remained stable at 26.9 per cent or RM241.8 billion as compared with the cumulative loans in the banking system.

The ratio of the household debt to the gross domestic product remained stable at 75.9 per cent last year as compared to 76 per cent in 2009, he added.- Bernama