National House Buyers Association of Malaysia (HBA) has called for the extension of the rent-to-own scheme to the middle-income group, reported The Edge.
This comes as most new properties launched by developers does not fall within the affordable range, or priced from RM150,000 to RM300,000 with a built-up area of at least 800 sq ft and features three bedrooms.
“New properties launched by developers that fall within this price range are very rare. Even studio units with only one bedroom and [a] build-up of only 550 sq ft are sold in excess of RM500,000 in the Greater Klang Valley and are beyond the middle-income group’s reach,” said Chang Kim Loong, honorary secretary-general of HBA.
“If this situation continues, Malaysia will face a housing crisis in the form of a ‘homeless generation’, where an entire generation or even generations of the rakyat will not be able to buy homes.”
With the rising costs of living, a rent-to-own scheme would be of great help to the mid-income group, particularly the ‘sandwich generation’ or house buyers with elderly parents and young children to provide for.
“This group is in dire need of a rent-to-own scheme, since legally owning a house provides financial security in their golden years so they do not need to continue renting [a house] when they are no longer economically active or able to work,” he explained.
Aside from rent-to-own schemes, Chang also suggested other ways to address issue such as providing incentives to property developers as well as offering preferential interest rates for borrowers and developers.
The government could also offer land to responsible developers at a lower price or lower conversion premiums provided that 70 percent of the site will be used for affordable housing. It could also fast-track approvals for affordable housing projects.
Moreover, utility companies should bear the cost to lay the last mile of utilities in housing projects, given that said companies have already been privatised.
“In the past, utilities such as water, telephone and sewage were owned by the government and hence, developers were required to bear the costs to lay the last mile of such utilities,” he said.
“However, the government had privatised these utility companies, so it only makes sense that privatised utility companies start to bear the costs to lay the ‘last mile’.”
Image sourced from NST
Radin Ghazali, Content Writer at PropertyGuru, edited this story. To contact her about this or other stories email radin@propertyguru.com.my
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