New housing scheme only fattens developers, not helping buyers

New housing scheme only fattens developers, not helping buyers

Source: The Leaders Online

PUCHONG: Parti Sosialis Malaysia (PSM) today slammed Bank Negara for not addressing the fundamental issue revolving around the lack of home ownership among Malaysians.

In a statement today, PSM secretary general A Sivarajan said that the main reason why many could not own a house was due to low wages and exorbitant prices of homes.

“The government data itself recommends that if a family earns RM3,000 a month, they can only afford to buy a house three times their pay, or about RM108,000.

“But instead of addressing the issue of low wages and skyrocketing house prices, Bank Negara is only easing loan application for the people. This will not solve the problem. It will only fatten developers’ bank accounts,” he said.

Recently, Bank Negara expanded the eligibility criteria for those seeking to purchase property under the RM1 billion Fund for Affordable Homes.

Effective Sept 1, individuals planning to apply for financing to purchase affordable houses would be eligible to do so if they have a maximum monthly household income of RM4,360, up 86% from the earlier threshold income level of RM2,300 per month.

Plus, the maximum property price will be increased to RM300,000 from RM150,000. These new terms would help buyers from this income group to obtain financing to purchase their first house.

Hurling brickbats on the new initiative, Sivarajan said that the new move would put house buyers in further debt, especially those under the B40 group.

He also said the new initiative would only help the middle class, who can afford to purchase a house worth RM300,000.

“The RM 1 billion allocation will not help the lower income people, who only earn a paltry sum between RM1,100 and RM2,000,” he said.

Sivarajan also accused the government of only helping the developers,  in order to help the latter sell their homes at exorbitant price.

“Bank Negara itself had said that 68% of the houses built remain unsold due to mismatch between supply and demand as developers continue to sell them at exorbitant prices.

“This new move will only embolden developers, as it will not provide any incentive for them to reduce their prices.

“As a result, developers will continue building homes which are out of reach for Malaysians, especially among the B40 group,” he said.

As a solution, the PSM leader urged Bank Negara to focus on building homes worth RM100,000 and below; and get government linked companies such as Khazanah Nasional Berhad to embark on such projects.

“And stop helping private developers who only think about making money and failed to commit themselves in providing affordable homes for Malaysians.

‘The government should not lose their focus; which is to help working class Malaysians to own quality homes at affordable price,” said Sivarajan.

By G Vinod