PRIVATE housing developers are appealing to the government to provide the same exemptions as those in the 1Malaysia People's Housing Programme (PR1MA) scheme to encourage them to build affordable houses.
The Real Estate and Housing Developers' Association Malaysia (Rehda) president Datuk Seri Michael Yam said the developers are supportive of PR1MA and the government's agenda in providing affordable housing, especially to those living in urban areas earning between RM3,000 and RM7,000 in household income.
"It is almost impossible for private enterprises to deliver affordable houses in urban areas for between RM150,000 and RM400,000 due to the rising land prices, compliance costs, building material and labour costs and interest costs paid on financing idle land when awaiting development approval," he said recently.
It wants a "level playing field" for private developers and for them to benefit from the same exemptions, waivers and/or facilitation grant to developers which will, in all probability, provide a product that would be as competitive.
The Real Estate and Housing Developers' Association Malaysia (Rehda) president Datuk Seri Michael Yam said the developers are supportive of PR1MA and the government's agenda in providing affordable housing, especially to those living in urban areas earning between RM3,000 and RM7,000 in household income.
"It is almost impossible for private enterprises to deliver affordable houses in urban areas for between RM150,000 and RM400,000 due to the rising land prices, compliance costs, building material and labour costs and interest costs paid on financing idle land when awaiting development approval," he said recently.
It wants a "level playing field" for private developers and for them to benefit from the same exemptions, waivers and/or facilitation grant to developers which will, in all probability, provide a product that would be as competitive.
At the inaugural Business Times Insight Series last Friday, which focused on affordable homes, PR1MA chief executive officer Datuk Abdul Mutalib Alias said a public-private partnership will be involved in meeting the 80,000-unit target.
PR1MA will build 50,000 homes by sourcing land from the Federal or state governments, government agencies and government-linked companies, while 30,000 more units would be built by private developers.
"When PR1MA Corporation is able to get government land at nominal to 'zero' cost and exempted from a whole raft of conditions normally imposed on private developers, such as the requirement to build low-cost housing, allocation for Bumiputera units at a particular discount, provision of infrastructure and amenities and possible waiver or reduction in capital contribution to utility companies, it has major cost savings that enable PR1MA to supply units at lower than market price," said Yam.
"This would render market pricing and products of private developers uncompetitive."
He said private developers' delivery system has been time tested and proven in their ability to build more than a million low- and medium-cost housing in the last 40 years.
"If this advantage and benefit cannot be extended to developers wishing to embark on affordable homes, then it would be more practical and sustainable if government takes responsibility for social housing for the urban poor and disadvantaged and also affordable housing and relieve developers from providing subsidised housing," he suggested.
By this move, private commercially driven enterprise can concentrate on the higher-end properties.
"This way the inefficiencies in cross subsidies and prescribed burden can be removed, enabling developers to maximise profit that would result in higher tax collection by the government," Yam said. - Business Times
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