GEORGE TOWN, June 22 — The gradual increase in the supply for affordable housing between now and 2025 will prevent a glut of such homes that are also high in demand, said Penang housing development committee chairman Jagdeep Singh Deo.
Disputing a StarBiz report that there may be a glut in affordable housing in the state with more than 35,000 units in the pipeline, Jagdeep said not all the units are being built at once.
“We have planned a total 35,106 affordable housing units, to be built by the state and the private sector, between now and 2025,” he said in a press conference today.
The first batch of these units, about 8,000 units from both the state and private developers, will only be ready in the next three to four years.
All the 35,106 units will be built in stages and spread out over the next 10 years to meet growing demands.
“We received about 6,000 applications for affordable housing units as at January last year and since January this year, we have allowed home buyers to register direct with developers so there are now more registered,” he said, but did not have the total numbers who registered through private developers.
All applicants will be vetted through by the state housing board and those who meet the criteria will be approved and their names will be given to developers building affordable housing units.
This year, Jagdeep said, there are 3,495 affordable housing units under five different projects that are open for application.
“We have given the developers a name list of 2,711 names while we will decide and approve more applicants every month to fill the units,” he said.
Jagdeep said there is absolutely no possibility of a glut in affordable housing units, instead there is a growing demand for it.
“My work would be done if there is an oversupply of affordable housing,” he said.
Today, StarBiz quoted Real Estate and Housing Developers Association (Rehda) Penang branch chairman Datuk Jerry Chan as saying the strict criteria for applicants in this category might mean lower uptake of the houses, which could lead to a glut.
The state government has an income limit for those buying these properties; RM6,000 for a RM200,000 unit, RM8,000 for a RM300,000 unit and RM10,000 for a RM400,000 unit.
Only registered Penang voters and first time homebuyers are eligible to apply.
Chan had asked that the state open up the affordable housing category to the market and put in place other measures to discourage speculation.
Jagdeep responded that the purpose of the scheme was to create affordable housing for those unable to buy their first homes.
“We will never open it up to the market or else it will defeat the purpose of the scheme,” he said.
However, Jagdeep said the onus is now on bankers to ensure that loan approvals for this category of homebuyers are more lenient.
“We have done our part so it is now the bankers’ responsibility to approve loan applications as the loan approval rates for low cost and low medium cost units are now only 30 per cent and for affordable housing, it is 70 per cent,” he said.
When contacted, chartered surveyor and real estate agent Michael Geh also said the demand for affordable housing priced between RM200,000 and RM400,000 remained high so there is no danger of oversupply any time soon.
He agreed with Jagdeep that the scheme must never be open to the market otherwise it will lead to speculation and spoil the whole affordable housing market.
