Sabah working to slow down rise in home prices, says Hajiji


  • Nation
  • Wednesday, 01 Oct 2014

KOTA KINABALU: A comprehensive undertaking is under way to lower Sabah’s house prices which have increased faster than the average income growth.

State Local Government and Housing Minister Datuk Hajiji Noor said the state was aware of persistent grouses that house prices were now beyond the reach of many.

He said the price of a double storey house in Kota Kinabalu in 2007 was about RM210,000 but a similar unit in the city’s outskirts was now going for RM450,000.

That is a growth of about 11.5% while the average income growth between 2009 and 2012 was about 7.2%, Hajiji said.

He said the increase in house prices was obvious over the past five years and among the reasons cited were a jump in land, building material and labour costs.

Responding to these cost hikes, the ministry is trying out various administrative procedures to curb house price increases.

“If and when necessary, I will ask the Housing Controller to seek new approaches such as getting a quantity surveyor to evaluate submissions from industry players prior to approving their Housing Develo­pers Licence.

“The reasons given by developers to increase prices is only one side of the story,” Hajiji said after opening a forum on rationalising property development in Sabah.

He said the Sabah government also wanted utility firms to do their part in helping to lower house prices in the state.

He said Sabah Electricity Sdn Bhd and Telekom Malaysia Bhd, as well as the Water Department, should lower their capital contribution rates for housing projects.

(Developers were required to pay capital contributions to utility firms for the provision of power substations and other infrastructure at any housing scheme.)

Noting that the SESB’s capital expenditure rate was about five times higher than that of Tenaga Nasional Bhd rates in the peninsula, Hajiji said this situation should not be allowed to prevail.

“Developers here then have no choice but to pass on the high costs to house buyers.

“We would like to see lower capital contribution rates or at least on par with those in the peninsula,” he added.

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