Improvements To HCGS To Help Overcome Property Overhang, Activist Proposes 1,000 Sq Ft PPR Units For Large Families And, More
28th March – 3rd April
The government has improved the Housing Credit Guarantee Scheme (HCGS) by raising the financing funds to RM5 billion from RM3 billion and expanding the qualified applicants to include fixed income groups.
Meanwhile, an activist for community affairs has suggested enlarging People’s Housing Project (PPR) units to 1,000 sq ft to accommodate larger households.
1. Improvements to HCGS to help overcome property overhang
The government has improved the Housing Credit Guarantee Scheme (HCGS) by raising the financing funds to RM5 billion from RM3 billion and expanding the qualified applicants to include fixed income groups.
The scheme, which offers up to RM400,000 in financing, is expected to reduce the number of unsold medium- and low-cost homes, reported Bernama.
“With the amount of financing, buyers can get a comfortable home even if it is further away from the city centre and it is something healthy for the industry as many homes within the range of financing can be sold,” said economic expert Jain Yassin.
Data from the National Property Information Centre showed that Malaysia has 10,901 properties priced under RM400,000 that have been built yet remain unsold as of Q4 2022.
Meanwhile, those who qualify to the scheme are required to pay a deposit equivalent to three monthly instalments, which is significantly lower than the 10% of purchase price set previously.
2. Activist proposes 1,000 sq ft PPR units for large families
An activist for community affairs has suggested enlarging People’s Housing Project (PPR) units to 1,000 sq ft to accommodate larger households.
Jeffrey Phang, Chairman of community group MyPJ, noted that the current size of 700 sq ft is not suitable for big families, reported Free Malaysia Today.
In fact, a study by Khazanah Research Institute (KRI) found that 700 sq ft PPR units are no longer feasible, saying that the units need to be upgraded to at least 800 sq ft.
Phang said PPRs should also include facilities such as a study hall for children.
“The size of rooms is one thing, but it is equally important to have a study hall for children so they can study comfortably,” he said.
The PPR should also have a good management that would look after the building as well as the facilities, he added.
3. Residential Tenancy Bill study to be completed in June
The study on the Residential Tenancy Bill – which aims to control the relationship between tenants and owners, balance their rights and duties as well as provide a dispute-resolution system – is expected to be completed in June.
“In addition, this Bill also provides an action procedure as well as a resolution mechanism should there be any dispute in the tenancy process,” said Deputy Local Government Development Minister Akmal Nasrullah Mohd Nasir.
He noted that the Bill was first proposed in 2019 but was delayed due to disagreements on its initial draft, reported the New Straits Times.
“For example, it was previously suggested that the security deposit be held by the government when the tenancy agreement is drawn up between the owners and tenants. Fine-tuning was needed to ensure that all parties, including landlords and tenants, are protected,” said Akmal.
He revealed the Bill will be presented to Parliament next year.
4. Housing market remains robust in 2H 2022
Malaysia’s housing market remained robust in the second half of 2022, with property transactions hovering above pre-pandemic levels, said Bank Negara Malaysia (BNM).
It noted that the robust market activity was primarily driven by transactions for properties worth RM500,000 and below, reported Bernama.
Despite rising inflation and cost of borrowing, BNM expects the housing market to sustain its recovery momentum, amid a gradual improvement in business and income conditions as well as policy measures.
However, the housing market will face downside risks stemming from demand and supply imbalances.
BNM shared that while the number of unsold housing units remains high, it is on a downward trend, with no significant concentrations in key areas or projects.
Financing activity has also improved, with banks being more willing to approve loans. In fact, loan applications increased across all price ranges in 2H 2022.
“This has resulted in the overall loan approval rate recovering above its pre-pandemic average level of 76.4% (2021: 73.4%; 2015-2019 average: 75.9%),” said BNM.
5. Selangor government urged to resolve land ownership issue
Kampung Sungai Sireh Tambahan residents in Port Klang are calling on the Selangor government to resolve their land ownership issue.
The villagers had applied for land that was opened up in the 1980s as part of the state’s initiative to provide land to villagers. They were asked to pay RM27,000 in two instalments to the Selangor Housing and Property Board (LPHS), reported The Star.
The deal, however, fell through in 2017 as many of the villagers failed to make payments.
Representatives from the village sought the help of Pertubuhan Perubahan Rakyat Malaysia (Gerak) last year. After several meetings, they decided to conduct a town hall meeting to discuss the next course of action.
Meanwhile, the Selangor government said the matter could not be resolved due to the villagers’ lack of cooperation.
According to an LPHS spokesperson, 62 of the 262 registered owners are yet to claim their refund.
“Houseowners can submit their claims directly to LPHS. There is no intermediary involved,” she said.
“For those who have died, the heirs can submit their claim with the necessary documents via the Amanah Raya Bhd,” added the spokesperson.
6. JB-Singapore RTS link, Gemas-JB double tracking project to be prioritised
The Johor state government and the Ministry of Transport (MOT) have both agreed to prioritise two projects – the Johor Bahru-Singapore Link Rapid Transit System (RTS) and the Gemas-Johor Bahru Electrified Double Tracking project (PLBEGJB).
Progress on the RTS project has reached 32.78% and is slated for completion by end-2026, while PLBEGJB has reached 90.6% and is anticipated to be completed by April 2026, reported Bernama.
Iskandar Rapid Transit (IRT), another important project for Johor’s connectivity, has also achieved 24.14% progress, and is set to be completed by end-2025, said Johor Menteri Besar Datuk Onn Hafiz Ghazi.
The 4km RTS line is a cross-border railway project that will connect Bukit Chagar in Johor Bahru to Woodlands in Singapore.
Meanwhile, PLBEGJB, which features 11 stations, is deemed a landmark for small towns within Johor.
