Azmin: Affordable homes in Selangor will not exceed RM220k
(Malay Mail Online) – Selangor mentri besar Mohamed Azmin Ali today pledged to build affordable homes not exceeding RM220,000 in the state in locations close to transport lines.
Although the Goods and Services Tax, whichs start in April next year, will likely push up property prices, Azmin said that the state government would still maintain affordable home prices in the state between RM100,000 and RM220,000.
“The advantage of the (Selangor) state is that we have ample land unlike the Federal Government’s 1 Malaysia People’s Housing Programme where they would have to buy private land and commercial land to build the homes…certainly their margin is much higher,” Azmin told reporters here.
He said that the development of affordable housing in Selangor would also focus on sites close to public transportation lines and the city.
“Otherwise it will defeat the purpose,” Azmin said, adding that the state government is targeting to build 15,000 affordable homes within a two to three-year period.
He said that there are already few developers in line currently who are willing to commit to build the said homes, but their application would only be considered if they submit their construction permissions by next year.
Azmin explained the rule was made necessary to enable the state government to fast track construction of the homes to enable completion by 2018.
“They (developers) have to start construction in 2015 as well.
“Any later, and they will not be able to enjoy incentives we provide to them,” he said after a morning assembly with Hulu Langat public service staffs.
Some of the incentives offered by the Selangor government include lowered land premium and waived development charges in addition to fast-track approval for construction of the homes.
Azmin said that the incentives are given to encourage developers to build more affordable homes, which in turn would stimulate greater economic growth in the wealthiest industrial state in the country.
In October, US-based urban development researcher Demographic said that Malaysia has a “severely unaffordable” residential homes market, with housing even more out of reach for its residents than in Singapore, Japan and the United States.
Demographia’s report was cited in a report in Singapore’s Straits Times newspaper to highlight how many Malaysians continue to be locked out of the residential housing market despite the federal government’s attempt at helping first-time house buyers.
According to the ST report, Demographia rates housing as severely unaffordable if it is 5.1 times median annual income. Malaysia clocks in at 5.5x, higher than Singapore’s 5.1x, while housing in the United States and Japan is “moderately unaffordable”.
Government data cited by the ST report showed that since 2012 median monthly household income has risen eight per cent annually to RM4,258, slower than the average housing price increase of 10 per cent to RM280,886.
