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National Housing Policy – social renting, private renting and ownership

It’s very important for the government to have programmes for the B40 households. If this household  really could not yet afford paying for a home via mortgages, then getting them to pay the lowest rental possible is necessary. The reason is because once people pay too high rentals, they have no savings for future. In the current market, whether the B40 or the M40 households, they may be renting properties they could never afford in the first place (renters market currently) Once they get too comfortable, they will continue paying high rentals without understanding that they are going to be locked out from owning a property regardless of how long they rent. Here’s an earlier article: Renting is fine. Make plans to get your own.  I am glad that perhaps the National Housing Policy addresses this concern.
The National Housing Policy has been approved by the Malaysian Cabinet. National Housing Department director-general N. Jayaselan, said that the main thrust is the separation of public and private housing, with an emphasis on renting. He said, “We have put forward a Public Housing Management Act, for example, because we think the management of public housing will be a huge bombshell. So the issue today is more than just whether a buyer has the capability to pay the downpayment of a house. It is also whether he can finance the loan and whether he can pay for the house’s monthly maintenance.” Article in TheStar here.
Jayaselan said the government will be promoting “social renting” where the tenant first rent public housing before moving into what he calls “social ownership” of public housing and over a period of time, if affordability and his savings permit, he then moves into “private renting. And here is where private housing by private developers come in and the next step-up for him is “private ownership.” The government hopes to guide the person about these ratio; rent-to-income ratio, median house price-to-income ratio and the last being mortgage repayment-to-income ratio. As for the housing, it must come with quality. At whatever price, it has to have quality. Thus, there will be some standardisation. Article in TheStar here.
Happy understanding and let’s hope to hear more on the implementation of the National Housing Policy here in Malaysia.
written on 23 Nov 2018
Next suggested article:  Renting is not the end of the world. Maybe a good option.
 

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Charles Tan The Founder The Writer Kopiandproperty
Charles Tan

Charles is Founder of kopiandproperty.com He writes from his investment experience for the the past 20 years in investments including property, stock, unit trust and more as well as readings and conversations with many property gurus in the industry. kopiandproperty.com is an independent property blog which is not affiliated to any media company, property developer or even real estate agencies.

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