Racism in the property market

New law to stop racial preferences in rental sector should be expedited to protect landlords and tenants.

REAL estate agent: Eh, what race are you ah? You sound different.

Prospective tenant: Malaysian Indian.

Agent: Oh, cannot, cannot. Owner wants Chinese only.The above conversation is all too familiar if you are on the lookout for rental accommodation but happen to be of a certain race.

This particular exchange was related to me by the prospective tenant who chose to remain anonymous.

“I was stressed out, because my previous landlord didn’t renew the tenancy at our rented house in Subang Jaya and my mother had very short notice to look for alternative accommodation,” said Jaya (name has been changed).

Jaya, who lost her father at a young age, said that she faced discrimination from the majority of landlords or property agents that she contacted.

“And even if my race wasn’t the issue, they rejected me because I was a single female with an elderly mother.

“They questioned if I could afford to pay the rental even when I proved that I had a steady source of income,” she told me.

Jaya finally managed to secure an apartment unit in Jalan Kuching and in her own words, “a good landlord who is also Chinese”.

“I do feel that the younger generation of landlords are more open-minded. It’s the older ones who are stuck in a racial state of mind.

“These people help to perpetuate certain stereotypes such as Indian tenants stink up the place because they tend to cook with a lot of spices or that Malay tenants are poor paymasters,” she said.

The sad reality is that Jaya’s rental experiences are in fact the norm. Take a look at social media these days and you’ll find many other people who have similar stories to tell.

But what of the real estate agents themselves? Are their rental policies discriminatory or are they themselves under instructions from landlords to only select “certain” tenants?

“My interest is purely for my client,” said Jane (name has been changed upon request), adding that she has to safeguard her landlord’s interest.

Admitting that there are clients who insist on renting to only a particular race, Jane said that this practice is slowly decreasing.

“I find that in multi-racial, urban areas like Taman Tun Dr Ismail, people are broader minded and do not set conditions for rental of their properties,” she said.

Jane, who has been in the property line for more than 20 years, feels that racial profiling of tenants should not be practised.

“I’ve had pleasant as well as negative experiences with all races, including foreigners too. My job is to vet prospective tenants and based on face-to-face interviews as well as checks with employers and even the Companies Commission, I then recommend them to my clients,” she added.

But from the clients (in this case landlords) point of view, there are many pitfalls to renting out residential property to the wrong kind of tenants.

“I’ve got so many horror stories about the type of tenants I have had over the years,” said a friend who manages her family’s upmarket condominium unit in Bukit Ceylon, Kuala Lumpur.

“We don’t look at a person’s race or religion, but I do want to know if my renter can take care of my property and not skip rental payments,” she told me.

Her list of horror tenants includes the case of someone who let 20 people sleep in the apartment, a tenant who was caught with drugs in the toilet and the latest being the renter who disappeared without paying rent for nine months.

The fact is without dedicated anti-discriminatory laws, landlords are free to arbitrarily decide who gets to rent their property and can reject a tenant on the flimsiest of excuses.

And that’s the crux of the problem. Tenancy agreements in Malaysia are covered by the Contracts Act 1950, but we do not have specific legislation that protect both landlords and tenants which are common in other countries.

This, however, should change by 2023.

A new proposed Residential Tenancy Act (RTA) will include laws to protect both tenants and owners. But when the Housing and Local Government Ministry announced this in 2020, it was aimed at tackling racial discrimination in the rental market.

The wide-ranging act was tabled in Parliament last year but has yet to become law because the ministry has asked various stakeholders for feedback before the law is set to be passed next year.

While the draft law has received positive feedback from the Malaysian Institute of Estate Agents (MIEA), both the Housing Buyers Association and the Malaysian Real Estate and Housing Developers’ Association have already voiced their concern over the laws’ impact on the property market.

The fear from both these parties is that rental may trend upwards as landlords factor in any additional burdens that they have.

The unnecessary complexity from the government’s intervention in what should have been a private agreement between two parties is also a concern.

Despite these concerns which are genuine, my view is that the government should expedite the Act because racial preferences have become a norm as can be seen in rental advertisements.

We may pride ourselves in being a multi-racial and multi-cultural country, but unfortunately, racial discrimination is still very much alive in the rental market.