HBA concurs with PM’s call to review conditions set for provision of affordable housing in mega projects

• The association also wants the creation of a Housing Index “as different states and localities have different standards or definitions of affordable housing.”

PETALING JAYA (June 2): The National House Buyers Association (HBA) has come out in support of Prime Minister Datuk Seri Anwar Ibrahim’s plan to review conditions set for housing developers to ensure that they provide affordable housing for all mega projects developed.

“HBA concurs with our PM’s vision and aspiration to ensure that 30% of all housing projects, not just mega projects, should provide affordable housing,” said Datuk Chang Kim Loong (pictured), Hon Secretary-General of HBA.

The association also wants the creation of a Housing Index “as different states and localities have different standards or definitions of affordable housing.”

It also noted Bank Negara Malaysia’s recent statement that median property prices in the country are now above the affordability of median income. Hence the need for a Housing Index.

“This index could potentially assist developers in pricing their products in less-developed states or locations to overcome the mismatch between buyers’ affordability and developers’ selling prices, which has resulted in a huge overhang of some completed properties as previous statistics revealed.”

HBA also touched on the affordable housing price cap and its stand on it: “While HBA agrees that affordable housing should be priced cheaper in states such as Kedah compared with the Klang Valley, we believe the current cap of RM120,000 to RM300,000 for a three-room unit with a built-up area of at least 79 sq m near transport facilities and amenities should be maintained.”

“Our concern is that developers may use selective statistics to increase the price cap on affordable housing, which means the [local government development] minister may be swayed to increase the price in uptown areas, such as Ara Damansara in Petaling Jaya, to more than its defined RM300,000, to the developers’ definition of affordable housing, which is RM500,000,” said Chang.

He added that it “would be incorrect to conclude that just because the median income in Petaling Jaya is higher than Kota Baru in Kelantan, the cap for affordable housing in Petaling Jaya should be revised upwards”.

“A person who purchases a property in Petaling Jaya does not necessarily live or work in the city or earn the same median income as those who do.

“Hence, HBA believes the current RM300,000 cap of affordable housing should be maintained even if the ministry launches its Affordable Housing Price Index. The Housing Index should also consider the cost of living in the respective locations to establish net incomes for buying properties,” explained Chang.

BTS 10:90 concept

Chang also called on an evolution towards the Build Then Sell (BTS) 10:90 concept. He said it provides “better protection of buyers in the affordable category. They are the segment of society that cannot afford any form of delays/abandonment.”

Last month, Deputy Local Government Development Minister Akmal Nasrullah Mohd Nasir said the authorities have identified 110 projects that have been delayed, 435 sick projects and 112 abandoned projects as of March 31.

Under the BTS 10:90 concept, buyers pay 10% upon signing the sale and purchase agreements, and the balance 90% when the homes are completed with separate titles, Certificate of Completion and Compliance, water and electricity connected, and house keys are given.