‘TACKLE ISSUE HOLISTICALLY’
MARC says relaxing mortgage lending requirements alone insufficient to fix problem
THE affordable housing issue needs to be tackled using holistic longterm policy measures. Malaysian Rating Corporation Bhd (MARC) said any solution would require a rebalancing of supply-demand dynamics of the housing market and the effective implementation of medium- and long-term development measures to accelerate household income growth.
“Considering the complexity of the housing affordability issue, loosening mortgage lending requirements alone will be insufficient to solve the underlying problem.
“More importantly, it is not a long-term policy measure and should not be treated as one,” it said in its Economic Report titled “Affordable housing woes: Holistic long-term policies necessary”.
It said house prices had escalated in recent years, with prices surging by an average of 9.3 per cent per annum over the 20102016 period, compared with only 3.6 per cent per annum over the 2002-2008 period.
“It is noteworthy that since 2012, the growth pace of house prices has outstripped that of income levels.
“This is due, in part, to the fact that the supply of new housing has increasingly become concentrated in the higher-priced categories,” it said.
MARC said with the median an- nual household i ncome of Malaysians at around RM63,000, too many had found the bulk of newly launched houses beyond their reach.
“Given the present situation, MARC feels that loosening mortgage lending to boost home ownership is not the way forward.
“It is important to assess the potential adverse consequences before proposals aimed at encouraging home ownership through easy financing are considered,” it said.