Affordable housing projects must embrace a humane concept
Contributed by Datuk Chang Kim Loong
Prime Minister Datuk Seri Anwar Ibrahim emphasised that housing projects in Malaysia, especially affordable housing, must adhere to a humane concept. He stated that these developments should prioritise the well-being and dignity of the people, ensuring they are not only affordable but also conducive to a good quality of life.
Anwar highlighted the importance of equitable amenities, saying that if luxury housing offers high-end facilities like a pool, then affordable housing should also include a pool for the community. Similarly, if the wealthy have access to golf courses in their residential areas, the public should at least have access to well-designed playgrounds in theirs.
He also underlined the urgency of affordable housing development, pointing out that there is no justification for delaying affordable housing projects once the necessary documentation and approvals are in place.
The National House Buyers Association (HBA) has posed related questions on this matter and would like to provide input on these pertinent issues, including:
Q1. Based on what the Prime Minister said about the need for humane concepts in affordable homes, do you agree?
HBA: We agree that all homes must be safe, secure, comfortable, of good quality and affordable to truly embody the concept of being humane or fit for human habitation. However, the definition of humane can vary significantly depending on the definer's background, life experiences and economic circumstances.
We believe that the key to delivering humanity to the citizens of Malaysia is not simply building homes within certain categories, such as the affordable segment or social housing. Instead, it requires a reimagining of the nation's housing policy—one that goes beyond merely boosting the GDP or maximising the profit margins of housing developers, their shadow investors/actual owners and other industry stakeholders.
For most Malaysians, a house is not merely an investment product. It is a source of security, a home, a place where families are nurtured and a sanctuary after the challenges of daily life. This truth resonates across all Malaysians, regardless of the economic categories the government assigns us—B40, M40, T20, T15 or T1—and transcends racial lines as well.
The housing policy needs to be revamped. We need to focus on addressing the massive and insurmountable problems surrounding the abandonment of projects, delays in the completion of housing projects, defects, non-issuance of strata titles and the fact that houses are very expensive for the average Malaysian. This is especially true for those who do not qualify for social housing or the affordable segment but are not wealthy enough to afford gated communities, private clubhouses or private swimming pools—what some people define as humane housing.
How do we address this? Perhaps by changing the Sell-Then-Build (STB) policy to Build-Then-Sell (BTS). HBA has compromised to accommodate housing developers' illogical and unjustified resistance to implementing the Build-Then-Sell concept across the entire housing industry. We have proposed limiting BTS to the BTS 10:90 approach for the affordable segment. Moving the financial and construction risks to housing developers is a more humane way to mitigate the problems house buyers and owners face. The BTS concept, already incorporated into the Housing Development Act (Act 118), is a humane way to ensure house buyers' and owners' rights are protected.
The question now is, what is affordable? If we ask housing developers, they define affordable housing as being priced between RM500,000 and RM900,000. However, houses in this price range are typically intermediate terrace houses and condominiums. In city centres like Kuala Lumpur, terrace houses are rarely built anymore as developers prioritise monetising any land they acquire. The best way to maximise profits is to construct expensive but small-sized condominiums. Terrace houses, on the other hand, are usually located in suburban or remote areas. It is puzzling how these houses are priced so high when they are far from the city centre.
In parallel with changing the system to Build-Then-Sell, the government and policymakers need to define affordable housing rather than using catchphrases for houses priced between RM150,000 and RM300,000. These homes face the most problems, including abandonment, major defects and low-quality materials and workmanship. They are also predominantly high-rise strata or landed houses built in remote areas.
If we are serious about ensuring houses are humanely affordable with facilities and amenities similar to those enjoyed by the wealthy, we must address the root causes of high housing prices. These include:
- Compliance costs.
- Land premiums for conversion.
- Capital contributions for utility infrastructure.
- Cross-subsidisation and land allocation for public facilities and bumiputera lots.
- Non-transparent profit margins of industry players.
Developers claim their profit margins are a mere 11% of the gross development value (GDV). However, this figure is questionable as houses become more expensive yearly while their size and quality diminish.
Q2. How do you define the humane concept in the context of affordable housing? Do you have any example?
HBA: The term human-concept or human-centric refers to approaches, designs or perspectives that prioritise human needs, experiences and well-being. In various contexts, it emphasises placing people at the centre of decision-making, processes or systems, ensuring that solutions are designed with empathy, usability and effectiveness for human users.
This involves respecting the average citizen as human beings, not merely as end consumers of overpriced products.
It also means respecting the rights of homeowners, even if the owner and their property are old or no longer aesthetically appealing. A notable counterexample is the proposed Urban Redevelopment Act (URA), which is not only inhumane but also unconstitutional. The proposal divides property owners into two groups: the sell versus the stay. Under the government’s proposal, a consent threshold of 80% for properties less than 30 years old and 75% for those older than 30 years is required to proceed with redevelopment.
This approach has caused significant discontent among dissenting groups, who understandably feel unhappy with such inhumane treatment.
Q3. What specific features or amenities do you believe should be included in affordable housing projects to enhance the quality of life for residents?
HBA: Basic amenities should include sanitary services, security, parking facilities and easy access to public transport. Building affordable apartments in remote areas does not align with the concept of humane housing and merely pays lip service to affordability. Housing developments should also provide playgrounds, shop-lots for essential services such as banks, clinics, eateries, sundry shops, markets (if possible), police stations, fire stations, schools, kindergartens, mosques or suraus, other religious houses of worship and green spaces or parks.
This is not a new concept, as housing areas since the 1970s have included these amenities. There is no reason why developments in the 21st century—or beyond—should be any different.
Furthermore, there should be no segregation between owners of affordable housing units and those of medium-high-end units within the same development. Complaints have been received from owners of affordable housing in RUMAWIP, Kuala Lumpur, who allege that owners of medium-high stratified developments have attempted to prohibit them from using certain common facilities. This is despite sharing the same main entrance and compound, as well as paying the same rates for maintenance charges and sinking funds.
This matter has been referred to the Commissioner of Buildings (COB) for investigation and appropriate intervention.
Q4: Is the bumiputera quota relevant for affordable homes category? Shouldn’t it be needs based and not race based?
HBA: In our opinion, there should not be any bumiputera quota (whether in the form of discounts and/or reserved units) for the affordable homes category based on the following rationale:
- Affordable homes should be open to all Malaysians
Affordable homes should not be allocated to a specific group based on race, religion or creed. The overriding principles of equality and fair distribution should take precedence over racial considerations. Poverty does not discriminate and affects individuals across all demographics. - Affordable homes should be allocated based on income eligibility
Allocation of affordable homes must be conducted in an objective and transparent manner, based solely on income eligibility. A clear income limit should be established and HBA recommends setting the maximum combined household income limit for Affordable Homes at RM5,000 per month at the time of purchase. This approach ensures that such homes are directed towards the intended target segment in the most fair and transparent way. - Affordable homes should be reserved for first-time house buyers
Affordable homes should be exclusively allocated to first-time house buyers. HBA has previously expressed disagreement with the practice of allowing PR1MA units to be available to second-time buyers as there are already insufficient units to meet the needs of first-time buyers.
Furthermore, affordable homes must be strictly for owner-occupancy. Periodic compliance checks should be conducted by the government and any owner found renting out such properties should have their home confiscated and resold to more deserving applicants.
Additionally, restrictions must be in place to prevent owners from reselling affordable homes for at least 10 years after taking vacant possession. Owners wishing to sell within this moratorium period should only be allowed to sell back to a Special Purpose Vehicle (SPV) or government agency established to manage affordable homes. These units should be repurchased at the original price, adjusted for the official rate of inflation. - Demand for properties is primarily location-driven
The demand for properties is largely determined by their location. Certain areas may naturally attract stronger interest from specific demographics, such as Chinese or Indian buyers in some locations and bumiputera buyers in others.
Imposing bumiputera quotas in predominantly Chinese or Indian areas is impractical, just as it is unnecessary to enforce such quotas in areas with a majority Malay population.
Q5. How feasible is it for developers to include amenities like a swimming pool or playground in affordable housing projects? What are the potential costs and benefits of including such amenities?
HBA: It is a prerequisite requirement of the local council that all submissions of common facilities plans and layout plans by property developers must include the element of a playground and other standard amenities. However, there is a significant difference between a swimming pool and water features. The cost and ongoing expense of maintaining a swimming pool—including its accessories, generators and safety measures—are substantial and present a long-term financial burden. Providing a pool facility inevitably increases maintenance charges and contributions to the sinking fund.
Meaningful change
- Sustainable designs, not superficial upgrades: New developments must prioritise energy efficiency, durable infrastructure and cost-effective maintenance systems. Greenwashing modern amenities without addressing long-term sustainability is irresponsible and short-sighted.
- Integrated urban planning: Green spaces, public transit access and amenities for an aging population must be central to redevelopment plans—not added as afterthoughts to justify inflated costs.
Q6. There is no justification for delaying affordable housing projects once the necessary documentation and approvals are in place. Please offer your comments.
HBA: This message is particularly relevant for local councils, land offices and the relevant Ministry. The various fees, charges, premiums and other payments—both official and unofficial—that housing developers are required to pay to these authorities are ultimately passed on to buyers through the final house price. These costs directly impact the quality, size and types of amenities that developers are willing to provide.
As property developers are commercial entities, all costs will inevitably be factored into the sales price. We agree that there is no justification for delaying the construction of affordable housing projects, as such delays disrupt developers’ cash flow and inflate costs. Facilitating the timely completion of these projects is crucial.
Our primary concern, however, lies with late, sick and abandoned housing projects that have marred the industry. Even affordable housing developments are not immune to such issues, leaving buyers to suffer the consequences.
Datuk Chang Kim Loong, Honorary secretary-general
National House Buyers Association (HBA)
Stay ahead of the crowd and enjoy fresh insights on real estate, property development and lifestyle trends when you subscribe to our newsletter and follow us on social media.
