In a bid to meet the actual market demand, the Ministry of Housing and Local Government (KPKT) will realign the extended Home Ownership Campaign (HOC) to fully focus on low-cost developments and exclude high-cost and medium housing projects.
KPKT national housing department DG Jayaselan Navaratnam acknowledged that the HOC did not manage to lower the number of unsold houses flooding the market.
“In the earlier campaign, we opened it to all markets to better gauge the customers’ expectations, their profiling and products acceptance, which also gave us a better picture on this situation,” he said.
“We just want sales to pick up. But since it was down and not able to push the market into a steady and normal flow, we are looking at ways to overcome this.”
He noted that the campaign’s first six months did not reach its goals as there is still an ongoing mismatch between demand and supply, reported The Malaysian Reserve.
In Q4 2018, the home overhang supply was at 32,313 units valued at RM19.86 billion.
Despite the incentives offered, the HOC only managed to sell 1,144 housing units valued at RM650.87 million, prompting the government to extend the programme to December.
For the remainder of the extended period, Jayaselan said KPKT’s focus would be on affordable houses priced below RM300,000, along with sub-sale houses that remain unsold in the market.
“This time, KPKT will focus 100 percent on offering affordable houses capped at RM300,000,” he said.
According to him, the ministry has approved around 6,000 affordable housing units that will be made available for HOC.
Among the expected units are projects built by Syarikat Perumahan Negara Bhd (SPNB), PR1MA and others under KPKT.
Jayaselan also shared that rent-to-own (RTO) home ownership programmes would also be eligible for HOC certificates, which in turn would allow purchasers to enjoy stamp duty waivers.
RTO is a financing scheme that gives first-time buyers the flexibility of turning rental into down payment towards purchasing a house at a locked-in price.
Jayaselan noted that the HOC would remain vital in providing the best understanding for parties involved in the property sector.
“It is not the absolute solution to the current overhang, but a catalyst for all to understand the market and developers to gauge the type of houses that they should build, and bankers, to understand the profile of purchasers.”
He also revealed that KPKT is looking at asking the government to extend HOC until next year.