Friday, 3 December 2010

Penang houses are just ‘not affordable’



"Developers prefer to cater to investors and  speculators who buy for rent or to flip over and make money"

Making their point: Mohd Idris (right) and Dr Lim showing a chart on the percentage of the vacant house units in some states in Malaysia.

THE average price of a house on Penang Island in 2009 was RM550,000 — the highest in the country and RM160,000 more than the average price of a house in Kuala Lumpur.

State government think tank, Socio-Economic and Environmental Research Institute (Seri), said the price was eight times the average household in-come.

Its senior fellow Dr Lim Mah Hui said the house price should be between three and four times the average household income.

Dr Lim added that most houses that were built did not cater to the need of the majority of people.

“The building of super luxurious condominiums should not be encouraged. There are too many empty houses in Penang. The demand is there but it’s not affordable,” he told a press conference yesterday.

Consumers Association of Penang president S.M. Mohd Idris said house prices have soared to exorbitant levels in major cities of the country.

“Even the middle class cannot afford to own a house or apartment, let alone the lower income group,” he said.

Mohd Idris said that it was time for the government to start a public housing policy that provided affordable housing, particularly in urban areas, to people from the lower income group.

“A good example worth studying is the Singapore Housing Board where the government spearheads the building of affordable housing for a majority of its citizens,” he said.

He said the majority of Malay-sians want affordable homes but developers are supplying houses that they cannot afford.

“Developers prefer to cater to investors and speculators who buy to rent or to flip over and make money.

They also go overseas to aggressively market properties as they are still cheap by international standards.

“Unlike Indonesia, the Philippines, and Thailand, Malaysia is one of the few countries in Southeast Asia to allow foreigners to own landed property,” he said.

Source: The Star