BIG NUMBER OF AFFORDABLE HOMES UNSOLD
Key issues are end-financing and unreleased Bumi units, says Rehda
DEVELOPERS launched more affordable houses in the first half of this year (1H2018), but a large number of these homes, priced below RM500,000, remained unsold.
According to the Real Estate and Housing Developers’ Association Malaysia (Rehda), more than 65 per cent of the total 12,522 residential units launched during the first six months of this year were affordable homes. This is higher than the 52 per cent of affordable homes launched in the second half of last year.
Rehda’s Property Industry Survey 1H2018 showed that unsold units had increased from 66 per cent in 2H2017 to 75 per cent in 1H2018. The majority of unsold units were properties within the RM250,001 to RM500,000 pricerange, located in Kuantan, Pahang and Alor Star, Kedah. There was a significant number of unsold properties in the RM500,001 to RM700,000 price range in cities like Johor Baru and Shah Alam.
Rehda president Datuk Soam Heng Choon said the two main issues that led to unsold units were end-financing and unreleased Bumiputera units.
“The survey showed that respondents facing end-financing problems increased to 89 per cent in 1H2018, and 39 per cent of the loan rejections were for properties priced RM500,000 and below. So, to say that Rehda is not doing affordable housing is a misstatement,” he said at a media briefing yesterday.
Contributing factors to the financing issue include lower margin of financing offered, ineligibility due to buyers’ income and adverse credit history, he said.
Rehda patron and immediate past-president Datuk Ng Seing Liong told the New Straits Times recently that banks should not depend on a housebuyer’s payslip in approving a loan, as their potential client might have other sources of income.
“Banks have to think out of the box. There may be people with other sources of income. Those earning below RM50,000 a year don’t have to submit their earnings to income tax . However, that doesn’t mean they don’t have other sources of income,” he said.
Soam said a review of the Bumiputera housing quota policy was one of Rehda’s three wish-list items for the 2019 Budget. The others are reduction of compliance costs and for the government to take on a bigger role in providing social and public housing.
“We believe that if there is a release mechanism for Bumiputera units in housing projects nationwide, there will be lesser stock in the market,” Soam said.
The Housing and Local Government Ministry is looking to review the Bumiputera housing quota policy and the release mechanism to ensure that they are in line with current market needs.
Of the 152 Rehda members in the peninsula that participated in the survey, up to 25 per cent of them had 30 per cent of unsold stock compared with 27 per cent in 2H2017.