PETALING JAYA: The sale of 64 Kuala Lumpur City Hall (DBKL) land lots being probed by the Malaysian Anti-Corruption Commission (MACC) could affect the supply of affordable homes – should investigations drag on.
According to reports, it has been alleged that nearly half of the land lots were disposed of for Federal Territories Affordable Housing (RUMAWIP) development – while the rest were earmarked for high-end residential and commercial developments.
Knight Frank Malaysia managing director Sarkunan Subramaniam said that while the investigations are necessary to right any alleged wrongdoings, he noted that a dragged-on investigative process could hamper the supply of affordable homes in the market.
“If these projects are alienated for affordable homes, it may affect the supply of such homes while investigations are pending,” he told StarBiz.
Under its Perbadanan PR1MA Malaysia programme, the previous administration had said that it would build one million affordable housing units by 2018 for those with a household income of RM2,500 to RM15,000 a month.
As of March 2018, some 140,000 PR1MA homes were under various stages of construction while 15,000 units have been completed nationwide.
The new Pakatan Harapan government has pledged to build one million affordable homes within two terms.
Meanwhile, the MACC has begun investigations into 424.29 acres of land worth RM4.28bil sold by DBKL to Yayasan Wilayah Persekutuan between 2013 and this year.
It has been alleged that no open tenders were called and that the land lots were sold below the market price.
The transactions were also said to have been done without going through a proper valuation report.
Sarkunan urged that independent valuers be brought in to evaluate the land lots.
“If the valuation made by the previous administration is under question, perhaps it would be best to get even up to two valuers to sort out the alleged wrongdoings,” he said.
PPC International managing director Datuk Siders Sittampalam, meanwhile, said the MACC’s investigations should not have any impact on the local property market.
“Most land lots are developed in phases and it won’t create additional supply. It has already been carved out and given to developers.”
Despite the current property market glut and news of various property and construction projects either being reviewed or scrapped by the new government, investor sentiment does not seem to be affected.
At 5pm yesterday, property stocks ended mostly higher – Mah Sing Group Bhd ended up five sen at RM1.10; SP Setia Bhd closed three sen higher at RM3.07; UEM Sunrise Bhd ended up 3.5 sen to 73 sen; Sunway Bhd closed two sen higher to RM1.53 and Malaysian Resources Corp Bhd closed four sen up to 66.5 sen.
On Tuesday, Kenanga Research noted that the property sector outlook was still unexciting, with the KL Property Index underperforming the FBM KLCI.
However, it said, value is emerging with the bigger property companies offering deeper value, firmer earnings trajectories for the near term and decent balance sheets.
Did you find this article insightful?