The housing glut – the G-word few want to say – in Penang has once again come under the spotlight.
The state’s response has been tinker with the eligibility rules for affordable housing so that better-off buyers can now take up the slack.
Now, this is the problem: unlike in the past, when PDC played an active role in providing affordable housing, the state has been lieaving to market forces and the private sector to fulfil this role.
But that resulted in too much of the wrong kind of homes being built. Only now that there is a glut, which the state vigorously denies, does the state wants to intervene in the market (to save the developers from the glut that has built up?).
Now is the time it should leave it to market forces to push down the prices of homes in the face of the glut. After all, if supply is more than demand, prices will gradually drop. Instead, the state is intervening in the market now by allowing better-off buyers to take up the glut in housing originally meant for the lower-income groups.
Check out the following statement by Aliran:
The Penang state government’s recent announcement of the relaxation of the rules for eligibility for affordable flats in the state does not tackle the root cause of the overhang: the fact is, the ‘affordable’ homes are simply too expensive for the low-income group.
No amount of relaxing of the rules can mask this fact.
On 23 October 2017, the Edge ran a story showing what the various income groups could afford in Penang based on their income:
Property price levels that Penang residents can afford:
- RM118,000 (for the bottom 40% of the people)
- RM230,000 (for the middle 40%)
- RM442,000 (for the top 20%)
What the median Penang household can afford – RM195,000 (see chart above).
Average home price in Penang at the end of 2016 – RM410,000
The Edge also found that housing prices in Kuala Lumpur and Penang were “severely unaffordable” at over six times the annual household income. Based on a median household income of RM5,409 in 2016 in Penang, it said half of Penang residents could only afford homes priced up to RM195,000 – well short of the RM410,000 average home price in Penang (at the end of 2016).
(A home price of three times the annual household income is considered affordable. For example, if the annual household income in a family is between RM2,000 and RM3,000, then the family would only be able to afford housing between RM72,000 and RM110,000 – the latter being close to the affordability figure of RM118,000 for the median bottom 40% of households, as reported in The Edge.)
What this means is that many don’t earn enough to afford the ‘affordable’ homes targeted at them. The fact that banks have been rejecting 60% of housing loan applications should tell us something. Moreover, 16,528 homes below RM150,000 are unsold nationwide, suggesting there could be issues of not just affordability but also location (far from jobs) and transport (commuting time, lack of public transport, fuel costs). Full statement here on the Aliran website
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Nowadays unlike the past too much spending at shopping malls, easy online purchase, indulgence like food reflexology, pedicures, latest hair styling etc and overpriced Starbucks coffee, leaving little money left to purchase a house especially already taken car loan!
Ask tung land as what kind of entertainment is past? Now walk orso glue to smart phone. In super mart has all kind of food
In the recent past, people didn’t shriek unless one was a Chinese opera performer!
Night shrieks @ tua-hee (street opera) entertainment can still be heard during Hungry Ghost Month!
Tung land, no thank me? Heritage city no heritage culture? What you do nothing to promote “tua hee” big show? You spin about nyonya and is bullsheet.
Pls try harder shrieking louder than tua hee! But first ask permission from Anil, ok?
You kau beh kau
bu orso has to ask permission?
Shriek = kau beh kau? 🙂 🙂 🙂
Shriek= tua hee= peng land cultural centre. The heart of overseas hokkien tua hee heritage. It is People like you are snitch …
All entertainment today requires money.
That is why most B40 seeks procreation as recreation.
Cinema goers now can afford at least RM15 for a CNY movie besides popcorn drinks combo almost RM30 a person. Time has changed the lifestyle of stylo mylo indulgence eg cars and condos leaving little for old folks spending and own self security funding.
Peng land tua hee foc.
Earn more than diminishing Komtar Dedak:
Practice your tua-hee (street opera) shrieking for 6 solid months to qualify for entertaining Hungry Ghosts Month ho-hia-tee. Suggest you practise in an air-tight shipping container so as not to attract Pontianaks in the dead of night!
“banks have been rejecting 60% of housing loan applications …”
Because the borrowers are already saddled by car loan?
these people do not plan their finances and not taking care of their credit rating….or buying beyond their capability..
Better to buy a car or a house first?
Get a flashy car first to hook up a potential life partner and then get the inlaws to finance condo purchase after pleasing them with the grandkids.
Car depreciates in value unlike property raising in value as an asset. But most people do not understand this simple fact. Anil as an accountant can educate his readers here.
I believe personal career empowerment (skills upgrade, work knowledge, digital tools, etc) are more relevant for the youth in workforce (in their 20s) to get ahead of the competition. Once reaching the mid-level / top-level of career advancement, then only invest in properties as one’s income is more than enough to finance both a house & a car (which is actually optional as a depreciating asset & we have Grab to use). Forget about cars, invest in other type of investments like gold, fine art (paintings), shares (blue chips), commodities & a reliable life partner. And help improve the Penang… Read more »
Invest in tua hee. Yr roots and culturally alive
the one whine about over-development the most ask people to invest in properties…..seriously? hehe
People generally invest (one) to stay in. Not to speculate like what you have nothing better to he-he spin!
After graduated still need to spend on ‘personal career empowerment’ – must have been studying courses not relevant to industry needs. Better get proper career counselling first before embarking on your tertiary education, unless you are pursuing fake qualification from degree mills like our piliticians. Else you are wasting your parents’ hard earned money that coukd have been used for property purchase.
no car please, it is not environmental friendly , I am sure green fighters like Lim Mah Hui, Salma Khoo, Anil and Tunglang do not own cars…
Tung land had 4wd with monkey bars in front roaming around the heritage city
Why again shrieking monkey bars??? Gatai ah?
Oh year of boar. Your 4wd fronted with wild boar bar
Suddenly so enlightening under the coconut tree!
But this will cause immeasurable dismay in developers saddled with an overhang of high-end properties!!!
Information for Shriek + Wei:
Shrieking Banner – 100K > 460K Rebate!!! off new properties. Property site @ the end of flyover at start of Jalan Scotland.
For whispering T&C,
go to wah!-wah!-wei! showroom for further ego-boosting-happy-shrieking-signing-up!
How Singapore fixed it’s housing problem according to Bloomberg:
Anil can attest to this after visited Singapore HDB?
Sungai Pulai Forest Reserve (gazetted in 1962) to be sacrificed as Forest City Golf Resort?
Pulau Kukup could be another victim in the name of development?
Now that you have visited Singapore, do you think their HDB model financing by one’s own CPF is affordable by average Singaporeans?
Anil can give his insight here.
Basic houses can cost less than RM50,000. Govt. can (a) fine developers failing to build low-cost (b) provide land (c) itself develop, rent as China govt. now does (not sell) and maintain.
Even services such as medical care and education can be free. It has been done elsewhere. Ask yourself why almost all of Iraq, Libya, and Syria were reduced to rubble, and why Venezuela and Boliivia are being attacked. Mexico is next. Ask why our ex-PM was getting “good ratings” from the sanctimonious West.
For homes priced up to RM2.5 million, the stamp duty on transfer of ownership title or memorandum of transfer (MOT) will be waived for the first RM1 million and reduced to 3% for the subsequent RM1.5 million. The 3% stamp duty will revert to 4% after this campaign ends.
Sunway Valley City (Paya Terubong) banner ad shouts 50% discount during CNY!!!
Q: Is there a price manipulation (mark up) in this pull strategy to ‘enable’ such 50% discount?
Q: This shows a hefty profit margin from original price should it sells without discount!!!
Q: Will government investigate developers’ profit margin from high end properties to justify Bank Negara’s report of unrealistic pricing of properties?
Tung land if hefty loss, you orso howl the gomen to investige? Every lelong or jump floor sales to be investigate?
You still don’t understand what is price manipulation esp. those of high price?
That is business. Jackson underwear orso auction high price. Willing buyer like you willing to kau beh Kau bu
Have you read the fine print of terns and conditions?
where got read fine print..the only thing he know is hantam blindly..hehe
You can only talk nonsense! Pls lah, go there to see for yourself, otherwise shut up!
No fine print T&C on outdoor banner (nobody does that with outdoor banners).
You have to go inside showroom @ site entrance to check out yourself!
That’s where they catch your emotional ego to buy!
Half price now. Go and buy now what are you waiting for?
If I buy that 50% rebate property, you will be spin-shrieking (like that Wei) I’m depriving others a home, that I am a speculator. The fact is I already satisfied with one staying-in property, why buy one more?
It’s people like you shrieking for more speculative properties that causes the greedy developers to build more high-end properties believing in your shrieks!
CNY condo flash sale minus stamp duties at shoppjng malls around the island to entice and entrap you.
Plenty of Chinese New Year Property Open House & Roadshow events (free makan too).
Check it up here:
quote “Now, this is the problem: unlike in the past, when PDC played an active role in providing affordable housing, the state has been lieaving to market forces and the private sector to fulfil this role.”
PDC still active with projects like Dua residensi, Jiran residences and massive housing in Batu Kawan…spin no 3….
and what is wrong with private sector taking some of the responsibilities in providing affordable homes ? they can provide lower price homes at location that the state government not able to provide…
What’s wrong with private sector ie the developers who build but cannot sell?
It’s a simple question of supply & demand equation. Sell at wrong price & sell nothing!
50% oredi. What are you waiting for? You want free?
Are you so stup to believe in that 50% rebate?
I quote “The housing glut – the G-word few want to say – in Penang has once again come under the spotlight.” glut and unaffordability happen all over the country and it is Penang state government’s doing and their fault..spin no 2
I quote ” The state’s response has been tinker with the eligibility rules for affordable housing so that better-off buyers can now take up the slack.” to be exact, it should read ” buyer from other state”…not ” better-off buyer ” as what the writer trying to mislead… spin no 1…
Penang state gomen is perennially beholden to greedy developers. Was the DAP headquarter in Rangoon Road ‘donated’ by a developer? CM Sin Chow, where is your economic learning? Have you not heard of or learnt from US subprime mortgage crisis? Too much of tangoing with greedy developers can make you dizzy to make good decisions for Penangites. We already knew from Bank Negara’s past measures & caution statements (to protect consumers) why the housing industry was going from bad to worse, notwithstanding the abundance supply (or oversupply due to over-confidence or monopolistic price behaviour of greedy developers) of properties but… Read more »
National House Buyers’ Association (HBA) secretary general Datuk Chang Kim Loong said many properties priced below RM300,000 are not selling because they were not built in the right location.
“Affordable properties must have three criteria – they must be priced between RM150,000 to RM300,000; the built-up must be at least 800 sq ft with at least 2-bedrooms so that it is conducive for family living; and they must be located in areas with good public transport connectivity and public amenities.”
In short, must be ‘cheap and fresh’ like buying prawns in the market.
Wrong marketing strategy?
They must be hallucinating high profiteering before building in far away places on ‘cheap, cheap lands’ without considering public transport & amenities! Whose faults? The housing consumers?
Same, peng land heritage no stay but want to buy condo far away
Go check out heritage property values in GeorgeTown & come back to shriek!
Time to move to Kelantan, I think I can afford houses there.
Adios amigo. Happy hunting and have fun over there. You selling your hse cheap and affordable to others
Penang is ruined! Condos building in every corner of the island and most of the buyers don’t even stay there. Please implement a rule where a citizen can only have a single property to his/her name.
great…now no more place to rent from now onward…and an owner moving from one city to another can not buy a new house without first sell his original house. if he can’t find a buyer for long period of time …he is stuck, not able to buy and no place to rent…
Husband, wife, son and daughter. At least 3 to 4 in the family just like owning a car
If cannot sell, then bo huat… Won’t stop us from stopping the craziness of housing development in Penang. Building like Penang has a population of Hong Kong….
Jealous of people having money to throw around but not throw at you
Rich people collect properties like people used to collect stamps. It is just a different commodity.
Employees of developer etc ?