KUALA LUMPUR, Oct 30 — A majority of housing projects built close to the MRT-SBK line are not affordable for the M40 and B40 groups, a think-tank says.
In its report, the Centre for Governance and Political Studies (Cent-GPS) found that most homes within a one kilometre radius from the stations do not cater to the two income groups, with the worst being Pusat Bandar Damansara (PBD), a suburb reserved mostly for the elite with a median home pricing of RM4 million.
Interestingly, Cent-GPS also found that areas which are nowhere close to being an upscale neighbourhood, such as Sungai Buloh and Taman Mutiara have also seen a huge increase in property prices.
“If we take for example a 1,000 square feet serviced apartment that is being sold at RM600,000 because it is near to an MRT station, it becomes very difficult to find a buyer because the mortgage cost would be around RM2,600 per month.
People who would generally take public transportation would laugh off this mortgage cost because they could not possibly afford that sort of monthly commitment,” the report said.
It added that only eight out of the 31 MRT stations surveyed, had properties which are within the RM400,000 price range, namely; Kajang, Stadium Kajang, Batu Sebelas Cheras, Bandar Tun Hussein Onn, Sri Raya, Taman Connaught, Taman Pertama and Maluri.
The think-tank also found that the government-owned PR1MA Corporation Malaysia (PR1MA) homes — an initiative launched by the previous Barisan Nasional (BN) administration, were also not located within the one kilometre radius of any MRT stations.
"The planning has clearly failed to increase the value of PR1MA housing for not integrating it with the MRT coverage area.
“We have assumed in this paper that the MRT is built to serve and connect the M40 and B40 market. We assumed that designers of the MRT had looked at the LRT lines, assessed their target ridership income bracket and worked to design the MRT to further convenience this large majority of Malaysians. The MRT was a way to bring all Malaysians closer together.
“So logically, as we continue to glance over the high rent and prices of the properties around the MRT, it makes little to no sense that the properties around the MRT station cater to buyers who are well beyond the M40 and B40 groups,” the report said.
The report was tabled today by Cent-GPS strategy and alliance director Zaidel Baharuddin.
The paper also looked into the median household income in Selangor of about RM7,226 monthly, adding that even if one were to dedicate 30 per cent of the sum — as per the recommended portion for mortgage by Bank Negara Malaysia (BNM) — it would still prove to be a tough ask, owing to the size of the homes.
"A median household income in Selangor is about RM7,226 per month, which if we take a 30 per cent commitment to a mortgage, this is translated to a property that is about RM500,000.
"But a median household would likely be a middle-sized family, which makes the size of the properties we see available around MRT stations, inapplicable.
"Even if we assume that a young family would require 1,000 to 1500 sq ft to live comfortably, very few properties near stations provide the required space at an affordable price, as corroborated by the houses offered under the PRIMA housing scheme. Alternatively, affordability benefits the single unmarried working adult who at best would be able to live in a 700 sq ft apartment," the report read.
Property prices remain a persistent issue in Malaysia, as in other parts of the world, with prevailing property prices surpassing the affordability of average wage earners.
In February, BNM warned of a shortage of affordable houses in the country, in a report that also disclosed data showing home prices to have been “seriously unaffordable” in 2016 by international standards.
As a result of the supply-demand mismatch, BNM said the level of total unsold residential properties in Malaysia stood at a decade-high of 146,497 units as at the second quarter of 2017, an increase from 130,690 units in the preceding quarter.
Last month, it noted the number of unsold housing units has in fact risen to 146,196 units as of end March, with four in five such units priced above RM250,000.