Affordable housing to remain top priority in Budget 2019

Among the Budget 2019 predictions listed by Affin Hwang Investment Bank Bhd (AffinHwang Capital) in a budget preview, it was projected that affordable housing will likely remain the Government’s focus for next year.

The research house expected some measures on affordable housing in Budget 2019, where emphasis will be to correct the mismatch between demand and supply in Malaysia’s housing segment, an occurrence which continues to persists.

“This has also been guided in the mid-term review of 11th Malaysia Plan (11MP), where a total of 200,000 affordable houses are targeted to be built for the remaining years of the 11MP (2018-2020),” the research firm recapped.

“This will include programmes by federal and state government agencies as well as private developers.”

The research firm noted that in the second quarter of 2018 (2Q18), 33.1 per cent of residential properties launched were in the price range of RM500,001 to RM1 million which is above the affordable price ranges of RM150,000 to RM500,000, as have been defined by the Housing and Local Government Ministry (KPKT).

According to A ff in H wang Capital, the number of completed unsold residential properties had reached a record high of 29,200 units in 2Q18, up from 25,200 units in 1Q18.

“The bulk of the unsold residential properties (25.7 per cent of total unsold) were also in the higher price range of RM500,001 to RM1 million. The three states which had the largest proportion of unsold properties were Johor at 20.5 per cent, Selangor at 16.1 per cent and Penang at 13.5 per cent.”

The research house believed the government’s incentives for affordable housing will be in line with that of the recently announced National Housing Policy 2.0 (NHP 2.0) by KPKT.

It highlighted that the NHP 2.0 is anticipated to offer better financing programmes for the lower income group as well as to address the current mismatch in demand and supply of affordable housing projects.