Federal Govt takes over low-cost housing projects
The Star 19/03/2002 By Michele Lian
KUALA LUMPUR: The Federal Government has taken over the implementation of low-cost housing projects from the states under a RM1.404bil strategy to
build and finance 40,000 units over the next five years.
Housing and Local Government Minister Datuk Seri Ong Ka Ting, who announced this yesterday, said the Cabinet endorsed the new policy on Feb 27.
He said previously, state governments borrowed federal funds to acquire and develop land for low-cost housing projects and ended up building the
units away from urban areas because of the high cost of land.
"But there is a huge demand for affordable homes in cities and towns because most of the people work there," Ong told reporters at the Parliament
lobby.
He said among the other weaknesses were inadequate funds given to state governments for cheap housing, forcing them to bear the remainder of the
costs.
"Whenever problems cropped up at the projects, the states also lacked experts who could offer technical advice," he added.
Under the new policy - to be implemented by the National Housing Department, which is governed by the ministry - loans would be offered through
financial institutions instead of the previous practice of asking states to provide the loans.
Ong said states faced numerous difficulties collecting loan repayments from low-cost house buyers.
"This will be more practical as most people do not take the repayment of government-offered loans seriously."
The minister said that because the new policy would only apply to low-cost units for sale, prices would be capped according to location, cost per
square metre and whether they were high-rise, terrace or cluster houses.
The ministry has set the price limits as follows:
HIGH-RISE exceeding five floors costing RM45 per square metre in cities and major towns - RM35,000;
HIGH-RISE consisting of five floors costing RM15-RM44.99 per square metre in major towns and their outskirts - RM30,000;
TERRACE and cluster units costing RM10-RM14.99 per square metre in small towns - RM28,000; and
TERRACE and cluster units costing less than RM10 per square metre - RM25,000.
Ong said out of the RM1.404bil allocation, RM1.14bil would be a revolving fund for development costs, RM158.8mil for land acquisition and the
remaining RM104.6mil for 50% subsidy of infrastructure costs to develop prime land outside towns and cities. The remaining 50% would be borne by
the developers undertaking the projects.
Ong said the Federal Government had already initiated several projects in Pahang.
He said states would help to determine suitable land for development and would distribute the low-cost units to eligible buyers.
Ong also said the private sector still had an important role to play in developing low-medium-cost houses in the RM50,000 to RM60,000 range. |
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