GEORGE TOWN, Oct 13 – The Penang state government has decided to increase the household income ceiling for applicants of affordable housing in the state to enable more people to apply for a bank loan to purchase a house. State Town and Country Planning and Housing Committee chairman Jagdeep Singh Deo said to making affordable housing more accessible in Penang, Bank Negara urged to ease loan conditions on affordable housing purchasers.
The new category of affordable housing had been introduced by the Penang State Government in January 2014 and had seen some 12 projects announced by the Penang State government which will see the provision of some 22,512 units of such affordable housing. Further, the private sector has submitted plans to build some 12,600 units of affordable housing in Penang.
State Town and Country Planning and Housing Committee chairman Jagdeep Singh Deo said currently, the nett household income ceiling for applicants for affordable housing of RM200,000.00; RM300,000.00 and RM400,000.00 is RM6,000.00; RM8,000.00 and RM10,000.00 respectively.
“Having regard to the fact that the banking sector may view this category of applicants as risky and as such, the high loan rejection rate, we have decided to increase the said household income ceiling to RM8,000.00; RM10,000.00 and RM12,000.00 respectively,” he told reporters here Monday.
“However, and most importantly, we have taken into consideration those who previously earned RM6,000.00 who were eligible for such affordable housing, and for this category, we have now introduced a new category of affordable housing, namely units priced at RM150,000.00. These units are also sized at a minimum of 750 square feet, but without finishing,” he said.
Jagdeep Singh said in order to stimulate the sale of such affordable housing units, the state government also decided to enlarge the pool of eligible buyers to those who already own property. Therefore, the purchaser under this category has to be a registered voter in Penang and may only purchase one such affordable housing unit, the moratorium on the said unit is five years from hand-over of keys unlike the current five years from the date of the sale and purchase agreement.
“It is hoped that more applicants will be able to obtain bank loans with this revision of the nett household income cap and therefore more Penangites will be able to access such affordable housing. It is imperative that the affordable housing projects take off without delay. Towards this end, for any such project to be viable and ready to be executed there must be a minimum of 60% take-up,” he said.
“However, as the market is generally seen as slow, not just for affordable housing but for all developments generally. Currently, this is permitted, however with a restriction to those who only own a low or low medium cost unit. It has now been decided that that those who own a property but one that does not exceed the price of the affordable housing unit intended to be purchased, may purchase such an affordable housing unit,” he said.
However, Jagdeep said the original property owned has to be purchased after 2008. He said in order to stimulate the development of such affordable housing, it has also been decided that 30% of the units in any particular 100% affordable housing project may be sold to the open market, on condition that the said units are to be sold at 10% above the controlled price in all districts except the North East district, where it is to be sold 20% above the controlled price.
“Further, the purchaser under this category also has to be a registered voter in Penang and may only purchase one such affordable housing unit, and the moratorium on the said unit is 5 years from hand-over of keys. The developers for this new open market category will have to contribute to the Penang State Government the top up in price, not in cash but in kind,” said Jagdeep.
The namely in actual affordable housing units in the said particular project, which will enable the State government to have its own affordable housing stock, which can be allocated to those who are on our list. It is hoped that those who intend to purchase such affordable housing units will act fast and not delay, as with these new measures in place, I am certain that the said units will be taken up very quickly,” he added.
