PETALING JAYA: Property expert Ernest Cheong has dismissed the possibility that urban property developers can, any time soon, sell their double-storey houses to the people they are meant for.
Speaking to FMT, he said he could not foresee salaries rising or prices of properties dropping.
He applauded the Sultan of Johor for suggesting that the government work with developers to encourage the building of more affordable homes, but he said double-storey terrace houses these days could not qualify as “affordable” to most working people.
“There is a serious gap between what Malaysian families can afford to buy and the minimum price developers must sell their double-storey terrace houses for,” he said.
“A figure of RM500,000 to RM600,000 will represent the cost of such homes to developers. This covers the cost of land, development and construction in places like Kuala Lumpur, Petaling Jaya and Shah Alam.
“These Klang Valley developers cannot sell these houses at below RM500,000 as that is their cost price.
“So RM500,000 is the minimum price, excluding profit, that a Klang Valley developer can sell such a house for.”
But the problem, he added, was that 95% of families in the Klang Valley, Penang and Johor Bahru could not afford to buy houses priced at more than RM250,000.
He said most working adults nowadays could not save more than RM500 a month because of the high cost of living.
This would make it difficult for them to service housing loans, he added.