The issue of housing unaffordability may spread into other parts of the country should it not be addressed now, according to Datuk Charon Mokhzani, managing director at Khazanah Research Institute (KRI).
“If we don’t start tackling the problems now, what’s happening in Penang and Kuala Lumpur could start happening in other parts of the country because we have more and more people, and urbanisation is increasing. There’s more demand for housing. So if we don’t fix the problem now, we’ll have a much bigger problem in the future,” he said at a forum organised by the Malaysian Economic Association.
In a report released last month, KRI revealed that home prices in Malaysia are unaffordable, particularly in Kuala Lumpur and Penang, where the market are dubbed as ‘severely unaffordable’, reported The Sun Daily.
“Secondly, a lot of people live in the rural areas. In the rural areas, you can easily own a house or a ‘rumah kampung’. So, at the moment, the problem isn’t there yet because there are enough houses but as more people move from the countryside to the city, they need houses built for them in the urban areas. We have to build houses as cheaply as possible and build as many as possible so that we can meet this demand,” he said.
Notably, the government cannot subsidise 70 percent of the population who have a monthly earnings of between RM3,000 and RM10,000 for housing since it is not sustainable. It will not also address the issue of affordability. Meanwhile, providing more loans will only increase the households’ debt burden.
As such, the only solution would be to bring home prices down by increasing the market’s supply and using technologies like the industrialised building system (IBS) that would raise efficiency and productivity, said Charon.
“It can be done. We’ve heard from the developer’s point of view, if we manage to implement better ways of building houses. For an example, with the IBS we can have more houses and hopefully at a price everybody can afford. Houses are expensive, no doubt. The biggest purchase most people would make is a house. They will always cost a lot of money but it’s how much they cost relative to how much your income is,” he said.
“We’re trying to bridge the gap, bring technology in so that there are ways to building houses quicker, faster and cheaper.”
Image: Sourced from Malay Mail Online
