B40 will face more issues with BMF’s affordable home proposal

One month ago, an affordable homes from as low as RM120,000 each in the Klang Valley was proposed by Better Malaysia Foundation (BMF). In fact, the sizes would range from 450 sq ft, 600 sq ft, 750 sq ft and 900 sq ft, selling from the price range of RM120,000 to RM300,000 each. BMF founder Tan Sri Vincent Tan said, “We believe this price range is achievable with government support in terms of charging lower land premiums and nominal development charges for affordable housing projects.”

BMF will also propose to the government to allow banks and financial institutions to provide 100% financing to B40 house buyers with two-generation home loans of between 40 and 60 years duration and this will make loan repayments more affordable and manageable. The earlier article here: 900 sq ft, 5 bedrooms and just RM300,000?

Article in themalaysianreserve.com Khazanah Research Institute (KRI) director Dr Suraya Ismail said, “Essentially, this proposed scheme takes money from the bottom 40% (B40) community in the form of intergenerational loans, therefore, the B40 pays at least two times more for the houses compared to shorter term mortgage tenures.”

“Additionally, the scheme also takes land from the state at a lower cost, ostensibly for building affordable homes.”

“In essence, intergenerational house loan for the B40 just means that children in this category will be more likely to inherit a ‘house loan’ — though not necessarily a house,” she said.

“Let us be clear. Greater financialisation does not equate to either higher affordability.”

“Rather, it creates more household indebtedness, ‘house poor’ conditions and even worse, possible foreclosures and bankruptcy of families,” she stressed. To read the article in full, it’s here: Article in themalaysianreserve.com

Space, Price and Design is really dependent on need

A single or a bachelor would not need a big place which he / she will have issues in paying and cleaning up. A couple who may only want a baby later does not need to immediately buy a bigger home today and clogged up all their investment funds. A family of 4 in need of a bigger space should be given a choice of a bigger space and yet still affordable even if it may be lightly further.

The seniors really do not need a big home where they need to climb the staircase everyday. They need a place where they have a community, where they have access to health facilities and they could have access to this by selling their current home and move into this new option. Looking at these examples would tell us that one size does not fit all and one price is even further away from fitting anything at all.

I disagree to a longer loan tenure if there are other options

I think it’s important to remember that a home is a need BUT we should not be paying for a home long time after our income stops. This is the case even if the next generation could continue paying for them. Please do look around the world. It’s really possible to build further and get it connected to the city centres. Encourage the acceptance of price vs size vs duration and a lifestyle change. Malaysia will not be the first because all over the world, suburb is a popular word. Plus if it’s connected, then it does not even need to be affordable landed properties. Developers could even build high rise and it will be very affordable too. Thanks.

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