Scarcity of land for affordable housing?


  • Business
  • Saturday, 08 Sep 2018

RESIDENTIAL land availability has been a critical issue when we discuss affordable housing. I am puzzled why we face such a challenge when we have ample resources.  

When I served as the state executive councillor for the Selangor government in the 70s, I recalled that we practised the acquisition of agricultural land for public development.

As a result of such a practice, large tracts of land in Selangor were acquired by the state government at low prices of around RM10,000 per acre.

They were then transformed into the prominent townships of Shah Alam and Bangi that we know of today. A similar approach was also applied in the development of the Kuala Lumpur International Airport in Sepang.

These examples proved that the government can address land issues by acquiring land in appropriate locations, converting agricultural land or purchasing land for affordable housing.

In fact, the only land owner that should be allowed to convert agricultural land for other uses for the benefit of the rakyat is the government. In some countries, the private sector is not allowed to convert agricultural land due to food security concern.

Agriculture-based companies have already reaped enough benefits from agriculture revenues off the land that they work on.

If agriculture companies were given a free hand to convert their land for housing development or other commercial purposes, our country will risk losing a lot of agricultural land and downstream impact of reduced food supplies.

At the same time, it will push up the value of agricultural land due to the expectation that it can be converted. Consequently, the cost of such land itself will become a burden when the government acquires the land for affordable housing.

Our government by law, has the provision to acquire land for the benefit of the general public particularly for affordable housing.

It is more viable to build affordable homes on agricultural land instead of on prime land for which the cost can be a major hurdle.

We know that our government has land in both prime and rural areas. To address the financial concern, it could sell land to private developers by tender at market price, and then leverage on the returns to purchase the lower priced agricultural land.

With this method, the government will benefit from the uplift in land value from conversion from agricultural to residential /commercial land and not agricultural landowners. The value creation can be utilised to subsidise affordable housing to benefit the rakyat.

Though most of the agricultural land are located in rural areas, the government can invest in infrastructure such as public transport, MRT and schools from the proceeds of its land sales.

This will connect rural residents to the cities and spur the development of new townships.

New townships that are properly developed will attract more people. With population growth, it will create business opportunities that will benefit the general economy in the long term.

From the lessons learnt from other countries, acquiring agricultural land and turning it into public housing developments is not something new.

This approach has been adopted by our own country and can be seen in the townships of Shah Alam and Bangi. 

Nowadays, the scarcity of residential land for affordable housing is mostly due to urban sprawl. It is an unavoidable issue when a country is developing but can be addressed with proper planning in place as we move into a developed nation status.

It is time to relook at our strategies and review how other countries have progressed in these areas.  

As I know, Kuala Lumpur City Hall has an aspiration to develop Kuala Lumpur to become a top 20 world class competitive city by 2030. Its draft report has indicated that we must enhance economic density, adopt a compact city concept, and avoid urban sprawl to achieve this vision.

Therefore, proper planning and zoning of land for housing should be a priority in developing our capital city in order to ensure a sustainable supply of affordable housing within the city.

For this purpose, the development of the Rubber Research Institute land serves as a good blueprint.

The government should be bold to acquire more suitable land and agricultural land for housing development.

Scarcity of residential land should not be a hurdle as there are many approaches and resources readily available in our country.

Ultimately, determination is the primary ingredient for the country to move forward in the aspect of affordable housing. 

Datuk Alan Tong has over 50 years of experience in property development. He was the world president of FIABCI International for 2005/2006 and awarded the Property Man of the Year 2010 at FIABCI Malaysia Property Award. He is also the group chairman of Bukit Kiara Properties. For feedback, please email bkp@bukitkiara.com


Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 7
Cxense type: free
User access status: 3

Business , property

   

Across The Star Online


Air Pollutant Index

Highest API Readings

    Select State and Location to view the latest API reading

    Source: Department of Environment, Malaysia