More Affordable Homes, Stringent Policies for Developers Needed to Solve Housing Woes – Part Two

More Affordable Homes, Stringent Policies for Developers Needed to Solve Housing Woes – Part Two

State should press developers more vigorously to build social housing

While there are existing policies in place to build affordable homes, the study suggests more could be done to press more private developers to do so rather than allowing them to surrender land or pay a hefty fine.

Currently, developers in Johor are required to allocate 40% of total houses as affordable housing if the projects exceed five acres. This is the highest requirement compared to the rest of the Malaysian states.

There are various types of affordable houses that cater to the needs of different income groups in Johor. This includes PKJ Type A, PKJ Type B and “Rumah Mampu Milik Johor” (RMMJ).

PKJ Type A and PKJ Type B falls directly under the provision of low-cost housing under the “Dasar Perumahan Rakyat Johor — Di Iskandar Malaysia” (DPRJ) or “Housing Policy for Johorian — in Iskandar Malaysia” – a new policy introduced in January 2014.

So far, the state government has committed to deliver 46,000 units of RMMJ houses by 2018. Of this, 19,600 units will be located in Johor Bahru.

Homes that fall under RMMJ cannot get exemptions from the state government.

The study shows that to date the state government has collected RM600 million from developers for the conversion of bumiputra status lots. They were then used to build more than 6,000 RMMJ units.

“Nevertheless, there is still a mismatch of supply and demand as there are 90,000 registered applicants for affordable housing in Johor, with only 60,000 affordable units (largely produced by private developers and state-linked companies) to be completed by the end of 2019,” the study shows.

Transparent managerial system needed

The study also shows the complications that could arise when converting bumiputra lots to non-bumiputra lots.

As Iskandar Malaysia develops, there has been an increase in the number of such conversions which the study says can be open to abuse.

Citing the case of former State Executive Councillor, Abdul Latif Bandi, his eldest son, and a property consultant who were charged with 21 counts of money laundering amounting to RM35.78 million, the study suggests a transparent managerial system to ensure its integrity.

“The power of officialdom, unfortunately, also opens up opportunities for ill-intentioned parties to collude and seek rent in some cases,” the study cites.

The case pertains to the conversion of bumiputra lots to non-bumiputra lots in projects at Kota Masai, Tebrau, Kulai, Kempas, Nusajaya and Johor Bahru.

Titled ‘Beneath the Veneer: The Political Economy of Housing in Iskandar Malaysia, Johor’, the study was conducted by Keng Khoon Ng and Guanie Lim.

The full version can be accessed online here: https://www.iseas.edu.sg/images/pdf/TRS12_17.pdf

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