REHDA president Datuk Ho Hon Sang. — RAJA FAISAL HISHAN/The Star
KUALA LUMPUR: The Real Estate and Housing Developers' Association (Rehda) Malaysia expects more targeted solutions rather than a one-shoe-fits-all approach to meeting affordable housing needs.
Its president Datuk Ho Hon Sang said although there are mandatory requirements which vary from state to state, the challenges lie in supply-demand mismatch.
"We are committed to provide affordable housing but the focus should be on the right location.
"Some areas require more such units, others less," he said in a statement following Prime Minister Datuk Seri Anwar Ibrahim's call for a MADANI housing concept to meet civil servants and B40 and M40 housing needs.
According to the National Property Information Centre's (NAPIC) latest report, 28.6 per cent of completed unsold housing in Malaysia in the first quarter of 2024 (1Q 2024) were priced below RM300,000.
Ho said another major challenge is the rising costs.
The Rehda Property Industry Survey Second Half 2023 and Market Outlook for 2024 released in March 2024 showed that the average rise in the cost of doing business was about 15 per cent in 2H 2023 versus 13 per cent in 2H 2022.
He reiterated that developers cross-subsidise affordable housing, which raises the price of free market units to keep the price of affordable housing below the cost of construction.
"The suggested requirement, whereby a full block or two need to be made into MADANI housing instead of a set percentage, will naturally cause a further increase in free market prices for those not eligible for affordable housing,” Ho said.
This includes the M40 group whose income is higher than the eligible criteria threshold, he said.
Rehda suggested setting up a national affordable housing trust with developers contributing a certain percentage of their gross development value (GDV) to the trust.
"The trust committee - comprising representatives from the Housing and Local Government Ministry (KPKT), state authorities and REHDA - can analyse which part of the city or state has high affordable housing demand.
This is to ensure that units are built where there is demand, and not just to meet a non-market driven quota, causing some areas to be underprovided and others, overprovided, he said.
Ho added that banks should also play their role by offering subsidised loans for such units. Discounted development charges and improvement service funds will also help reduce the price of affordable units. - Bernama
