Solutions around the globe on dealing with housing issues
A good housing policy does not have to solely focus on cheap or affordable homes. While a dwelling has been a necessity of the human race – or any living being for that matter – since the dawn of time, people have always come up with creative ideas to deal with various housing issues.
From North, South, East and West, here are some interesting solutions found in countries around the world.
WEST
Germany is renowned for the lowest homeownership rate in the developed country, with only 51.9% of the population having a place to call their own.
The cause of the phenomena can be traced back to 1945 when Germany surrendered after World War II.
Houses were nothing more than rubble and debris, and the economy was not doing any better. Thus, the West German government initiated a housing law to boost the construction of houses.
As most citizens could only afford to rent a place rather than buy a house, the government focused on producing more rental housing. As the country evolved, the citizens remained contented to rent rather than buy their own house.
Some of the reasons include Germany having one of the lowest rental rates according to OECD-Eurostat PPP Database, and the state government capping the rent increase at maximum 15% over a three-year period.
While the Malaysian dream seems to be a home for everyone, perhaps the government and the public should reconsider their position on home ownership and initiate measures that make renting a more attractive option. A more flexible way could lead to a less pressured market situation.
NORTH
Ontario Premier Kathleen Wynne has announced several new housing regulations for one of Canada's most populous provinces.
One legislation calls for the addition of property tax for vacant homes. The tax was introduced due to the high number of vacant property in Ontario last year. At the rate of 6.5%, it is one of the city’s highest record in 65 years.
The new tax was aimed at encouraging property owners to rent out their place or sell it off.
Other notable changes include the formation of a housing advisory group that will be in charge of reporting to the government about the state of housing in Ontario.
The group will also be responsible for discussing the effect of any measure as well as providing additional steps that are needed.
Recently, Moody's Investors Service reported that the number of Malaysia’s unsold and vacant properties had increased exponentially over the past three years. The alarming situation will continue to worsen if no direct measures are taken.
The policymakers of Malaysia could learn a thing or two from Ontario when it comes to dealing with vacant properties within Kuala Lumpur in view of the current housing stress.
EAST
The scrap-and-build method in Japan’s housing market may seem eccentric to some people, but the recent trend replacing the old approach is something worth pondering.
In the old days, the Japanese would tear down the old house after the owner passed away or has moved out because prices of homes in the country depreciate over time. The average lifespan of a house in Japan is about 30 years.
As young people are usually the ones in need of a new home, they often have to bear the cost of demolishing a house as well as building a new one.
Hence, refurbishing an old home becomes the solution. The interior of the house receives a total makeover while the structure remains the same.
While it is a rare practice in Japan at the moment, this approach is slowly gaining traction as the price for the refurbished house is much lower. The developers also enjoy the benefit of not having to demolish a house and rebuild it.
What can we learn from this Eastern approach?
While Malaysians rarely practise the scrap-and-build method, it is perhaps advisable for the young buyers to consider searching for second-hand housing rather than insisting on buying an entirely new house as their first home.
Broadening one’s choice could lead to some pleasant surprises.
SOUTH
In Australia, citizens are offered the Commonwealth Rent Assistance as part of their housing support.
To ensure that the people can live in a comfortable place without having to fork out half of their salary, rent assistance has been given to eligible citizens as a non-taxable income supplement payable to those who rent in the private or community housing markets.
While the Malaysian Government has been devising several policies and housing schemes to help the people own a home, it would be helpful if the authorities could provide assistance to those who are renting, rather than focusing on the prospective home buyers or landlords.
