Penang Watch

A Penang Watch statement about Redha's push to increase low cost and low-medium cost houses  price has been published in the sun -in a bit truncated form. Here is the missing bits: Penang Watch basically said that price hike need to be justified in terms of better deliveries noting the high rate of delays and abandonment in low cost housing projects in Penang. If the current sell-then-build system is not aboe to ensure delivery then REDHA should argue for a price hike with a switch to the better build-then-sell system. But Redha want both : hike price-and still want to continue a rotten system to advantage itself at all turns! Developers are about the only player in the market where they want payment first with no guarantee of delvery -just next to robbers in terms of the terms of `exchange', where one side takes all. 

NGO labels Rehda's request to raise price of low-cost houses as 'self-interest'
Bernard Cheah

GEORGE TOWN (June 30, 2008): A proposal by developers for the government to increase the ceiling price of low-cost houses has drawn flak from social and welfare organisations.

Penang Watch Coordinator Ong Boon Keong criticised the call by the Real Estate and Housing Developers' Association (Rehda), labelling it a "self-interest" move that would heighten the suffering of the poor.

Rehda has submitted a memorandum to the state to have the price ceiling for low-cost and low-medium cost houses respectively increased from RM42,000 to RM60,000, and from RM72,500 to RM90,000, it was reported today.

It has also asked for the physical density of housing units in low-cost development projects to be increased.

Ong said any increase in density would exacerbate social problems brought about by lack of space. He noted that certain dense housing estates have had high suicide rates.

"This should not be compromised at all," he said, noting that the Penang Island Municipal Council now allowed 120 units per acre.

"Even that is really crowded … It's a horror story just waiting to happen."

He said the current practice to start selling before projects are even built has caused a lot of abandoned or delayed housing projects, causing problems to housebuyers.

Malaysia Hindu Sangam social and welfare committee head P. Murugiah said the hardcore poor and low-income earners would suffer from price rise of homes, as it would affect rental rates.

"It would be difficult for them to buy low-cost units or even rent them," he said.

"The developers could consider giving special concession rates to low-income earners, like the 5% discount on house purchases given to bumiputras.

Murugiah said wages have not risen despite the increase in cost of living. He noted that rentals in many low-cost areas have shot up by 50% in the past three years.

He said the federal government should help by subsidising building materials that developers say are increasing in costs.