Gov’t Low-Cost Homes Benefiting High Earners

Pavither 24 Aug 2017

The authorities’ low-cost housing programmes are now benefitting the top 20 percent (T20) of Malaysian households, or those earning RM8,320 per month and above, reported the Sun Daily.

According to figures from state governments and Khazanah Research Institute (KRI), this group is now eligible for state-subsidised homes, like the ones offered under the Rumah Mampu Milik (RMM) Pulau Pinang, 1Malaysia Civil Servants Housing (PPA1M), Syarikat Perumahan Negara Bhd’s RMM, 1Malaysia People’s Housing Programme (PR1MA) and Federal Territories Affordable Homes Programme (Rumawip).

KRI noted that households with a monthly salary of up to RM12,000 are qualified for RMM Pulau Pinang, while those earning up to RM14,000 are eligible for PR1MA houses.

“We think that this should not happen because, fiscally, it is a burden to the government to start giving houses from the bottom 40 percent (B40) to the middle 40 percent (M40) and now to T20 households in Malaysia. It is too much burden on the government fiscally,” said KRI research Director Dr Suraya Ismail.

“Our option is, let the private sector be more efficient, have more and better priced housing and let them cater for the M40 and T20. We must provide options for households to buy from the private sector,” she told the media during KRI’s public talk on Tuesday (22 August).

Meanwhile, National Housing Department Deputy Director-General Jayaselan K. Navaratnam revealed that the original aim of the government’s housing programmes was to assist B40 households based on 2014’s salary structure.

“This is already 2017. What we designed was for B40 at the beginning but, along the way, the M40 also started to request. When M40 started to request, what we found was that, the T20 with salary at RM8,320 were also not able to purchase a house.”

Consequently, the authorities are presently looking at the key reasons why Malaysians with this kind of income cannot afford a home priced at RM300,000, he said.

“These are the things we are going to analyse now. What are they doing with their income? Are there any other problems that are making them unable to qualify to buy the houses? We are communicating with Bank Negara Malaysia to understand the realistic view of these issues.”

Suraya pointed out that a large number of houses offered by private property developers are out of reach for many families due to their expensive prices. Another reason is the limited supply of low-cost homes.

As such, she is urging the government to focus on lowering the cost of residential properties, so it doesn’t have to subsidise T20 households. For developers, they need to improve their productivity and efficiency to reduce the cost of the homes they sell.

“The government themselves should also look into shortening the planning approval (process) and what-not, especially when you are into the affordable housing scheme,” she added.

Image sourced from The Sun Daily

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