A nice article, its like everyone know what the problem are, but no one is taking a real action.
THE government has come up with all sorts of policies and regulations for the housing industry but it is an understatement to say that these have hardly been achieving their targets. Ask the lower-income group how traumatic it is for them both financially and psychologically to own a decent home or put a roof over their heads and that of their families.
And we are not even talking of the tens of thousand of house buyers who have been cheated in the all too rampant housing scams.
When will the authorities be able to say “enough is enough” and expeditiously deliver houses to people who have yet to own one and make the much touted “affordable homes” truly affordable?
With Budget 2016 to be unveiled next month, I really hope the prime minister, who is also the finance minister, will insert in his speech a policy under which the government will implement a price control mechanism to cap the profit margin allowable at least for perumahan rakyat or people’s housing programmes.
After all, we are very serious when it comes to controlling the prices of other daily essentials like rice, sugar, cooking oil, etc.
Isn’t a roof over one’s head equally if not more important than, say, sugar? It certainly is.
Both the federal and state governments should also free more idle land for people’s housing programmes to lower house prices.
And yet we allow a laisseiz-faire situation to persist with industry players calling all the shots and dictating their profits.
The situation is further aggravated by speculators who snap up property put up for sale and it’s time something is done about this, too.
Unlike Singapore, we are still too far away from reaching a decent level of home ownership and this is largely because it’s far too free a market out there while owning a house is the most basic thing. What is nation-building if there are still people who are still homeless because they can’t afford to buy a house under the present conditions which have been allowed to persist for so long?
Needless to say, I really hope Datuk Seri Abdul Najib Razak can take the bull by the horns this time.
Khazanah Research Institute (KRI), a unit of government investment arm Khazanah Nasional Bhd, recently came out with a damning report that the Malaysian housing market is “seriously unaffordable”, a phenomenon that’s very obvious to all Malaysians.
Its findings revealed a median house price of 4.4 times the median annual household income compared with an affordable market where the median house price is 3.0 times the median household income.
Kuala Lumpur and Penang are described as “severely unaffordable” markets reaching 5.4 times and 5.2 times the median household income respectively.
KRI’s conclusion that houses in Malaysia are seriously unaffordable is derived from facts and figures, based on a formula of household income vis-a-vis the prevailing prices of houses at various locations.
Why and how come the prices have to be so high is another subject for debate and yes, it’s true as the Real Estate and Housing Developers’ Association (Rehda) has since pointed out, there are other factors to be considered.
Rehda’s assertion that the cost of construction materials has gone up is true to a certain extent only, according to the House Buyers Association (HBA).
The basic question that begs to be answered is the percentage of costs that involves construction materials.
Does the industry subscribe to the teh-tarik syndrome whereby when the price of sugar goes up by 10 sen, the price of a glass of the brew also goes up by 10 sen? In other words, any price increase in materials becomes an excuse to increase selling prices.
On the weakening ringgit in recent months, the same question needs to be addressed.
“What percentage of building materials are imported and can these be replaced with local sources,” asked HBA secretary-general Chang Kim Loong.
He told me the unbridled escalation in cost happened well before the ringgit slump so to use this factor to justify the rising prices of houses in the last three years does not make sense.
Allowing foreigners to buy high-end houses will have a counter-productive effect in that developers will then focus on high-end properties and neglect the lower and medium-cost houses with detrimental effects.
But Rehda’s proposal for a single body for affordable homes instead of having various agencies and schemes such as 1Malaysia People’s Housing Programme (1PRIMA) and Syarikat Perumahan Negara Bhd is the same idea mooted by HBA years ago but which is still not taken up by the government.
We do not have to look very far to see how successful Singapore’s Housing Development Board (HBD) has been in providing affordable homes to over 80% of Singaporeans and with HBD recognised as the world’s biggest success story in housing.
The trouble with us is that we seldom want to emulate some of the things that have been implemented so well just across the Causeway but instead we send our officers to faraway places to study their models.
We also need information on affordable housing. In the past five decades, scores of low-cost housing projects and funding plans have been introduced and information on these schemes by various low-cost housing providers and state economic agencies should be made available to the public in a datebase.
This will allow individuals to learn about the availability of affordable housing in their communities and the financing options available.
Why isn’t there a single umbrella or data bank where information can be collected to coordinate the total number of such units being built, the locations and pricing?
The players must build the right product at the right place with the right pricing and the right numbers.
This article is from a veteran columnist - by Azman Ujang first appear in thesundaily.my on 17Sep2015.
Read other related housing articles HERE.
