REHDA Housing Conference 2018 Reinventing Affordability. 9 October 2018 * Wisma REHDA, Petaling Jaya Selangor

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SESSION 1: EXPERIENCE SHARING REGIONAL AFFORDABLE HOUSING PRACTICES: AFFORDABLE HOUSING IN MALAYSIA MR. N. JAYASELAN, DIRECTOR GENERAL, NATIONAL HOUSING DEPARTMENT REHDA Housing Conference 2018 Reinventing Affordability 9 October 2018 * Wisma REHDA, Petaling Jaya Selangor

What is Affordable House? United Nations Human Settlement Programme (2011): defined as homes that meet the quality and location; and home buyers still have the financial capability to buy other basic needs. Based on the Multiple Median approach, a home is considered affordable if the median home price is less than 3 times the median household annual income e.g.: Median household income: RM5,228.00 Annual Median Household Income: RM5,000.00 x 12 = RM62,736.00 3 Times Annual Median Household Income: RM62,736 x 3 = RM188,208.00 Average market price of all homes (1 st quarter 2018) : RM372, 801.00 2

Defining Housing Affordability

Factors Affecting Supply and Demand of Housing

Basic factors influencing effectual affordable housing delivery through the planning system

Identifying the housing gap Housing Demand Housing Supply Housing requirement assessment Provides evidence Housing Need Effective Demand Differences in housing demand and housing supply creates a housing gap Existing stock Incoming stock Planning and provision of housing Housing gap will be addressed by two housing sectors Social sector Market sector

Building an Enabling Policy Framework Government provides funding Government provides regulation for a competitive operating environment for both consumers and producers of housing Social renting Private renting Affordable ownership Asset accumulation Rent-to-income ratio Rent-to-income ratio House price-toincome ratio House Price Index Social ownership House price-toincome ratio To block the impact of speculative activities Served by the social sector Served by the market sector No private sector entity can provide leadership in both welfare needs (shelter) and private housing: a case of agency problems

Flexibility to move back and forth between renting and owning Social ownership Private ownership* Meeting housing needs Meeting housing needs Meeting housing demand Based on affordability Meeting housing demand Based on affordability Social renting Private renting Housing tenure & affordability indicators Rent-to-income ratio Median house priceto-income ratio Mortgage repaymentto-income ratio Note: * Fully owned or owned with mortgage

Overview Malaysia PEOPLE S HOUSING PROGRAMME (PHP) Public low-cost housing in the country began in 1955 with 441 houses built at a cost of RM2 million as a pilot scheme by thehousing Trust Double story houses built under a Housing Trust Project at Jalan Kampar, Ipoh, Perak

GOVERNMENT ALLOCATED MYR 12.433 BILION FROM 1998 UNTIL 2018 (20 YEARS) BENEFITS TO 118,250 FAMILY CONSIST OF 591,250 HOUSEHOLD I M P L E M E N T A T I O N S T A T U S PEOPLE S HOUSING PROGRAMME (PHP) 209 PROJECTS PEOPLE S HOUSING PROGRAMME (PHP) NATIONWIDE AFTER SUBSIDY 80% FROM GOVERNMENT PHP SELLING PRICE MYR 35,000 Peninsular Malaysia MYR 42,000 Sabah & Sarawak MONTHLY RENTAL AS LOW AS MYR 124 PER MONTH

STATUS OF PHP PROJECTS NATIONWIDE AS OF 24 th APRIL 2018 PHP PROGRAMME TOTAL PROJECTS COMPLETED UNDER CONSTRUCTION PLANNING STAGE Projects Units Projects Units Projects Units Projects Units PHP FOR RENTAL 084 73,439 83 72,439 01 1,000 00 0 PHP HOME OWNERSHIP 125 44,811 42 12,759 46 17,650 38 14,462 OVERALL TOTAL 209 118,310 125 85,198 47 18,650 33 14,462 ALLOCATIONS (MYR) 12,459,173,734.45 6,182,409,399.45 3,264,581,784.00 3,012,182,551.00

REQUIREMENTS Applicants and spouse are Malaysian citizens aged 21 years and above Household income not exceeding MYR 3,000 per month Priority given to those with family Applicants must not own any house

PHP DESIGN FEATURES TYPES OF HOUSES SPECIFICATIONS Build up area 700 sq ft 3 Bedrooms Apartment 5-18 storey (in city centre) Terrace - (in small town & rural area) 2 Bathrooms Living rooms SOCIAL FACILITIES PROVIDED Kitchen Musalla (Prayer Hall) Adequate Parking Lots Community Hall Kindergarten Facilities for the disabled Shop Lots

EXAMPLE OF PHP FLOOR PLAN

SITE LAYOUT PLAN FOR PROGRAM PERUMAHAN RAKYAT (PPR) KOTA BHARU, KELANTAN DARUL NAIM

CONTOH REKABENTUK PPR PHP HOUSE DESIGN PHP Tehel, Melaka PHP Ladang Siliau, N.S

CONTOH REKABENTUK PPR PHP HOUSE DESIGN PHP Sg. Melana, Johor PHP Krubong, Melaka

Looking at the key issues in Government Policy and other initiatives of providing adequate and quality Affordable House What allowance (concessions) will the Government make to encourage developers to build more? How can the Government engage with the Private Sector and what opportunities are there for developers and Investors? Examining the multiple partnership methodology such as PPP/BOT to facilitate Affordable Housing development and ownership and to enhance project delivery system. What is really holding up the delivery of Housing and how do we destroy these 'obstacles'?

Strategy Canvas for Providing Adequate and Quality Affordable Housing

Progress and Challenges 1. Policy Direction a. Trending, Analysis and Application 2. Enhancement b. Housing Development Act 1966 (Act 118) c. Regulation for the Housing Industry under Act 118 3. Business Model d. Function Analysis e. Conditioning the industry cost or methodology? 4. Reality Check f. What s real and what s myth

Thank you 22