Penang affordable properties – 51,238 applications!

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I must share this news about real demand; Penang affordable properties. Total applications are over 51,238. Recently a few friends said that the property market in Malaysia is made up of all speculators. This is despite the fact that 84% of all home mortgages are for one property. Then, they said it must be the remaining 16% which bought up all the rest. Yeah, perhaps even those speculators are buying in cash and therefore not shown? ­čÖé ┬áAnyway, coming back to real demand which I have always been saying. The demand slowed down because properties got unaffordable and people are unwilling to buy one level lower. That’s why transactions stopped. Sellers are also holding on too which somehow meant that these people have holding power, for now.

In Penang, a total of 51,238 people have applied for the low-cost, low medium-cost (LMC) and affordable housing units. 24,399 people applied for low-cost units, 23,582 for LMC and 3,257 for affordable units. The first apartment I bought in Penang was a LMC. At that time, I do not need any help from the state. RM123,000.  Today, the state has to step in to ensure those who needed them, gets them, at least in a more transparent queue. Another good update is that the work on the first phase in Bandar Cassis, Batu Kawan which consists of 149 LMC units and 371 affordable units already started last year. In other words, these people may get their homes by 2017. More would be starting end of 2014. They are projects in Teluk Kumbar, Jalan S.P. Chelliah, Bandar Cassia Phase Four and Kampung Jawa in Butterworth. Next year, the projects in Jelutong, Pintasan Cecil, the Sandilands foreshore in Jalan C.Y. Choy, Bandar Cassia Phase Seven, Ampang Jajar, Mak Mandin and Bukit Mertajam will start. As for the final two phases in Bandar Cassia, it will start in 2016.

I am sure all these projects combined would yield a few thousand units if not more. However, 51,238 applications is really a lot. Assuming, just half of these qualifies, it would take 2.5 years of the whole market’s new supply to cater to them. Personally however, I feel that the mentality of a lot of Malaysians must also change. My close friend told me that her mother’s friends told her mother to apply for the LMC since she qualifies. She can then resell the units once she has gotten them. Her mother said NO. Why should she take one away from those who truly qualifies. I think this is mentality that has to change. A roof over your head is something precious and not something that you try to profit from. In fact I continue to hear of stories where someone got these units by paying ‘extra’. Just hope this continue to be lessened continuously.

written on 25 Aug 2014

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