Khor Chap Jen, chief executive of developers SP Setia, said the gap is caused by requirements placed on developers to build affordable housing projects.
“In urban areas, because developers are required to build affordable housing and sell at a fixed cost, when their costs go up they can’t change those fixed prices, so they have to increase the cost of their open market units,” he told FMT.
PPR flats are only available to those in households who earn less than RM3,000 a month while the lowest property prices in urban centres is at least RM100,000. Those hovering just above PPR eligibility are priced out of the property market.
Khor said developers would be happy to contribute funds for affordable housing projects, but said construction should be left to the government.
“Our industry has always asked the government to take over the responsibility of building affordable housing, then the developers can concentrate on the open market and bring the prices down,” he said.
Tang Chee Meng, chief operating officer of property agents Henry Butcher, suggested that the government consider buying some lower-cost houses from private developers and rent them to the underprivileged groups who do not have the means to buy a home of their own.
Such a scheme would be similar to one in Lisbon, Portugal, where the local government rented vacant units before subletting them as subsidised housing. A similar scheme is being considered by Barcelona.
A property developer in Melaka, who asked to remain anonymous, suggested that a housing board be set up, as in Singapore, which would devise and implement effective housing policy.
With house rent in urban areas starting from nearly RM1,000 a month, he said, one such move could be to offer subsidised rentals for young workers with a five-year limit, which he believes would “give them time to save up, progress in their career, and then hopefully be in a better position by the end”.
He said it was up to developers to fix the oversupply problem, not the government, and there should be a focus on ensuring everyone can live in a home that they can afford.