GEORGE TOWN, Nov 1 — A Penang official stated his expectations for Budget 2019 to contain policies towards more affordable homes and accessible loans.
Local government, housing development and town and country planning committee chairman Jagdeep Singh Deo said Penang has prepared a list of housing and local government requests in anticipation of the first Pakatan Harapan (PH) Budget tomorrow.
He said the Budget should address housing issues faced by first-time buyers and those in the lower income groups.
“It is hoped that the 2019 national Budget will make a policy call to reduce the price of all types of housing in the country,” he said in a press conference today.
Another major issue facing home buyers was the high loan rejection rates, especially for first-time buyers of affordable homes, he said.
Penang has consistently lobbied Bank Negara to relax its lending guidelines for new buyers and those purchasing affordable homes, but to no avail.
He said the guidelines could be eased through longer loan tenures of over 30 years or multi-generational repayments.
“The banks can introduce more flexible loans in terms of percentage allowed such as more than the 90 per cent maximum and a reduction of interest rates for affordable housing,” he said.
Jagdeep also suggested that rent-to-own schemes be introduced by banks whereby the financial institutions collect rent for the first five years, after which this can be used as the down payment for the unit.
“There can also be a tiered loan repayment in which the repayment starts at a lower sum and then gradually increased,” he said.
He said some of these proposed mechanisms would address the high rejection rates and allow new buyers to finally purchase their first homes.
Jagdeep also hoped Putrajaya will look at building more affordable homes, especially in Penang that he said had been sidelined in the area by the previous Barisan Nasional government.
In the last three years, Jagdeep said none of Penang’s low-cost flats benefited from the Tabung Penyelenggaran 1 Malaysia (TP1M) federal maintenance scheme.
“There were 143 applications, only some 28 applications were approved and last three years, none were approved,” he said.
He said many low-cost housing projects in Penang are in dire need of funds for maintenance and repairs.
Finally, Jagdeep also hoped the federal government will reward state governments that implement smart city solutions and low-carbon initiatives.
