GEORGE TOWN, June 21 — The Penang state government will convert some of its low-cost housing projects into rent-to-buy schemes and plans to introduce more in the future, Penang Chief Minister Chow Kon Yeow announced today.

The Penang lawmaker said the first state exco meeting he chaired agreed to re-introduce the rent-to-own scheme instead of only selling low-cost and low-medium-cost housing units.

"We know that even though low-cost housing is RM42,000 and low-medium-cost housing is RM72,000, many still can’t afford to buy these units. Or after they were offered the units, they could not get loans, so we want to introduce this rent-to-buy scheme to enable them to buy their own home,” he said.

Under the scheme, he said rent paid over the long term of between 20 and 25 years will go towards paying for the unit and in the end, the tenant will be the owner of the unit.

"This scheme comes with the condition that the tenants have to pay their rent on time,” he said in a press conference after visiting a Penang Island City Council (MBPP) public housing project in Lebuh Ah Quee.

There were rent-to-own schemes for some projects previously, but Chow said these were few and far between now.

He said the state government has decided to convert some of its existing low-cost housing projects to the rent-to-own scheme rather than selling the units as low-cost units.

"Give us some time for the housing department to look at the criteria and mechanisms to implement this policy,” he said on the date of implementation.

The projects identified for this scheme are built by state agency Penang Development Corporation (PDC), one of which is a low-cost housing project in Mak Mandin, Butterworth.

"Once this policy is fully implemented, it will involve low-cost housing projects by PDC,” he said.

Chow said the state government can take a lead in this effort to ensure that the low-income group can buy their own homes while developers could also be involved.

"Developers can cooperate by selling the low-cost units they build to the state at cost price so that state can then offer these projects under the rent-to-buy scheme,” he said.

Earlier, during his visit to flats in Lebuh Ah Quee, he said MBPP has allocated RM500,000 to replace the roofs of the two blocks next year.

He said the flats, with a total of 24 housing units and 13 shoplots, were built in 1960 and one of only two MBPP public housing projects.

The rental rates for the housing units are between RM112 and RM117, while the rental for the shoplots are between RM208 and RM758 each which Chow said is below the market rate.

"Despite the low rental rates, MBPP has spent close to RM360,000 from 2008 until now to upgrade and maintain the flat,” he said.

He said it is a social commitment for the local government to maintain the flats for the tenants.

He called on the tenants to also help the state government to take ownership of their homes and take care of the property.