Take Back Onus To Provide Affordable Housing Rehda Tells Govt

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Rehda says affordable homes are being sold in the open market at higher prices, making them unaffordable. (Facebook pic)PETALING JAYA: The Real Estate and Housing Developers’ Association Malaysia (Rehda) has urged the government to do away with its policy of requiring developers to ensure up to 30% of homes in mega housing projects are affordable.
Rehda said the government should be fully responsible for making housing more affordable for everyone, as was the case over 50 years ago.
“This would eliminate the current practice of cross-subsidies that raise the costs of regularly priced housing, making it more expensive for the M40 group to afford homes,” said Rehda president NK Tong in a statement.
Ads by KioskedYesterday, Prime Minister Anwar Ibrahim urged the local government development ministry to review the conditions for housing developers, saying the 30% affordable housing threshold was not being met.
Anwar, who is also the finance minister, said housing developers must abide by the condition so that the middle-income group could afford to buy their own homes.
The government has required developers to ensure at least 30% of homes in mega housing projects are affordable since 1981.
Tong said the cross-subsidy requirement has resulted in developers facing multiple challenges in their efforts to meet the affordable housing requirement when building residential developments for the open market.
As a result, he said, the prices of homes in the open market have had to be raised to fund the construction of affordable housing, which is often sold below cost.
That has led to houses sold in the open market becoming unaffordable, which increases the risk that such developments will be late, sick or abandoned.
Ads by Kiosked“This is especially true for projects undertaken by small and medium-sized developers without the fiscal means to cushion themselves against financial challenges,” he said.
Tong said another unintended consequence of higher-priced housing due to the cross-subsidy requirement is the rise of completed but unsold properties, often referred to incorrectly as “overhang”.
He said the association is grateful for the government’s initiatives to mitigate pressing concerns such as the Rahmah cement scheme, but more needs to be done to ensure the recovery and sustainability of the industry. - FMT

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