Budget needs to address affordable housing issue

Budget needs to address affordable housing issue

KUALA LUMPUR: The Malaysian Institute of Professional Property Managers (MIPPM) is hopeful that affordable housing issues will be addressed when Budget 2017 is tabled tomorrow.

MIPPM president Sarkunan Subramaniam emphasised, however, that when it comes to concerns regarding affordable housing, the issue should not just be about “expensive homes.

“Affordability is not just about price – it’s also about the availability of financing,” he said at a briefing at the inaugural MIPPM conference yesterday.

“Housing demand is insatiable. But how do you turn it into effective demand? Finance needs to be available.”

With property prices consistently increasing, Sarkunan said it would not be surprising to see more people renting houses rather than buying. “In many developed countries, people rent all their lives.”

As such, Sarkunan said the MIPPM is proposing a progressive loan-repayment system to ease property financing for house buyers.

Sarkunan, who is also Knight Frank Sdn Bhd managing director, pointed out that such a scheme would allow home buyers to increase their monthly repayments in tandem with the higher salaries they would earn over a progressive period of time.

“A person’s salary does not stay fixed forever. The longer he or she works, the higher the salary. We feel this is something the banks should explore to allow first-time home buyers to buy property.”

Despite speculation that property prices will go down, the Malaysian Institute of Economic Research (Mier) believes that this is unlikely to happen in the near future.

A survey by the private think-tank revealed that 12% of developers had adjusted their property prices higher between July and September, while 80% left theirs alone.

“Rising construction material costs such as steel, cement, aluminium and higher wages have likely contributed to some of the developers’ decision to increase prices lately,” Mier said, adding that 16% of the respondents would likely raise their property prices in the fourth quarter.

Last month, at its Property Industry Survey announcement for the first half of 2016, the Real Estate and Housing Developers’ Association Malaysia (Rehda) pointed out that many genuine housebuyers had problems coming up with their downpayment when financial institutions only offered financing of up to 80%.

Rehda president Datuk Seri FD Iskandar emphasised that because many potential homebuyers are unable to provide the 15% to 20% downpayment for a house, their applications for home financing would get rejected.

Meanwhile, the one-day MIPPM conference, which was opened by Second Deputy Finance Minister Datuk Lee Chee Leong, featured topics on strata management tribunal issues and cases, effective management of service contracts and providers, issues and challenges in managing green buildings, facilities management versus property management and the latest trends and developments in property management.

Source: Thestar.com.my

 affordable homes, budget2017, housing loan

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