Abolishing discount will affect affordable housing, says Malay lobby group

Bernama pic

PETALING JAYA: Malay lobby group Majlis Tindakan Ekonomi Melayu (MTEM) has opposed the call by the Johor Real Estate and Housing Developers Association (Rehda) to do away with the 15% discount for Bumiputera properties worth RM1 million and above, saying this could impact the supply of affordable housing units in the state.

MTEM CEO Ahmad Yazid Othman accused Johor Rehda of only thinking of its members’ interests in lobbying for the abolishment of the discount as well as the requirement that 40% of all property units be set aside for Bumiputeras.

In a statement today, he noted that the policy was introduced to help increase Bumiputera ownership of such assets.

“For any unsold Bumiputera units, developers can appeal to the state government for a release consent that will convert a property to allow sale to non-Bumiputeras,” he said.

“Unfortunately for the developers, 7.5% of the sale price needs to be paid to the state government as a fee for each released unit.”

Adding that there had been 80,000 unsold Bumiputera units in Johor last year, he speculated that this was due to developers’ unwillingness to pay the 7.5% conversion fee.

He said the RM600 million collected from these fees so far had been used to build more than 6,000 units of affordable housing.

He noted however that there was still a mismatch between supply and demand as there were 90,000 applicants for affordable housing but only 60,000 units to be completed by the end of next year.

“Two unfortunate observations can be made. First is the inferior economic standing of Bumiputeras when compared to other groups, and second is the severe lack of affordable homes for most Malaysians which has been reported by Bank Negara and many other experts.

“If Johor Rehda succeeds in its lobbying, the result will be a huge loss of revenue for the state government.

“This will hurt Johor’s ability to build tens of thousands of low-cost housing units which are meant for all Johoreans, not just Bumiputeras,” he said.