GEORGE TOWN, Oct 3 — Strict regulations need to be put in place to ensure that affordable housing that costs less than RM350,000 per unit can only be bought by genuine and eligible home buyers, a forum on the Penang property scene heard today.
While applauding the Penang state government’s implementation of a housing policy to compel developers to build a certain percentage of units priced below RM400,000 for every project, chartered surveyor Michael Geh Thuan Peng said it would all be in vain if there was no mechanism to ensure these units were only sold to genuine home seekers.
“We need to have some sort of mechanism to only allow those who are eligible to purchase housing priced below RM350,000,” he said.
He was referring to the state government’s housing policy that compels developers to build at least five per cent units that cost less than RM200,000, 15 per cent units that cost less than RM300,000 and five per cent units that cost less than RM400,000 for every planned housing project.
This means, at least 25 per cent of every housing project, or 25 units out of every 100 units built, will consist of units costing less than RM400,000 each.
“This policy will only work if these 25 per cent units are sold only to those eligible and not to property speculators,” Geh said.
He said there needs to be a mechanism to ensure property developers use ethical sales systems where affordable housing costing less than RM350,000 are sold to genuine buyers instead of to speculators who will only flip the property at a higher price a few years later.
Currently, there are only regulations with an income cap for those who want to purchase low cost and low medium cost units.
The state government’s eight affordable housing projects, with the price ranging from RM72,500 to RM400,000 per unit, are also only open for sale to first time home buyers and those who meet income requirements.
Earlier in his opening address, housing, town and country planning committee chairman Jagdeep Singh Deo hoped developers will embrace the housing policy and appreciate the need for cross subsidisation in the provision of affordable housing.
He said the building of affordable housing is part of the developers’ corporate social responsibility especially when housing prices now have reached a record high.
On this, Geh called on the government to cut down premiums payable by the developers so that their construction costs are lower which will allow them to build more affordable homes.
“If they have to pay very high construction premiums, the cost will be transferred to housebuyers so if the government reduce the premiums that need to be paid, the developers could also reduce their prices,” he said.
Property prices in Penang has been escalating in recent years where new apartment projects generally costs upwards of RM400,000 while condominiums and landed properties cost in the millions.
