PENAMPANG: The Ministry of Local Government and Housing has decided to put on hold the proposed implementation of mandatory 30 per cent affordable home units for every housing project in the state.
Its permanent secretary, Datuk Matius Sator, said the decision was taken after discussion with Sabah Housing and Real Estate Developers Association (Shareda), to allow them to implement their own initiative first.
“We will revisit this policy again to ensure that Shareda fulfils its initiative objective,” he said when officiating at the Afternoon Talk on Affordable Home Scheme in Sabah organized by the association here yesterday.
Matius said the state government had agreed with the federal proposal to implement the 30 per cent policy in April to help the middle income group to own their house in response to the escalating property prices in the state over the last few years.
However, he said it was also aware of the difficulties faced by the developers due to the increasing prices of land and construction materials.
On top of the escalating construction costs, he added that developers were also faced with various other issues including delay in development plans approval and other setbacks that could discourage them from responding positively to the proposed policy.
As prices of houses had become a major issue that had forced the federal government to come up with the policy, he said it was relieving to note that Shareda had come up with their own initiative to provide affordable homes in a more achievable way.
He explained that the association had formulated a private initiated five-year plan, where it pledges to build 10,000 units of affordable houses across the state within the period.
“My ministry is still in the midst of verifying the details and particulars of every individual development project (under the initiative).
“Once this process is completed and agreed upon, we should be seeing the results soon,” he said, adding the houses to be constructed would follow the agreed criteria for the affordable home bracket, including the price range of RM150,000-RM250,000 and the eligibility of buyers.
The talk, which was the first organized by Shareda, featured representatives from key organizations as speakers, to deliberate on issues they are facing in providing affordable houses as well as their ongoing and future projects in the state.
Shareda president Francis Goh, in his talk said the prices of houses in some areas had increased up to more than five folds, mostly due to escalating land prices as well as increase in prices of construction materials.
He noted that skyrocketing land prices had made it impossible for developers to sell landed properties in town areas below RM300,000, as the cost of land alone was already higher that that.
For example, he said a piece of 2.7-acre land located between Star City and the Karamunsing Police Headquarters was valued at almost RM40 million.
Another piece of land farther from the city centre, a 6.26 acres in Bundusan, was priced at RM18 million or almost RM3 million per acre, he said.
Goh also suggested several measures be taken by the government towards addressing the issues in affordable home development, including building more outer ring roads to open less expensive lands outside the town areas.
While the private sector should acknowledge the need for implementing basic minimum wages, he said the government should also consider increasing the salary in the public sector to allow them to have better financial credibility to apply for housing loans.
Bank Negara also needed to relax the stringent loan approval for first-time house buyers and consider increasing the loan repayment period to 35 years, he added.
Government-linked banks, such as Bank Simpanan, EON Bank, Sabah Credit, Sabah Development Bank or even the Employee Provident Fund (EPF) also need to join forces to provide easier home loan schemes to the low income group.
Three other speakers delivered their talks, namely Syarikat Perumahan Negara Berhad Sabah Regional Office head Mohd Hafiz Sua Abdullah, Jabatan Perumahan Negara deputy director general Datuk Mohamed Yusoff Ghazali and Perumahan Rakyat 1Malaysia vice president Muzafar Mohamed.