Sarawak adopts ‘sell first, build later’ policy

Sunday Star 11/7/2004

KUCHING: The Sarawak government has adopted a “sell first, build later” policy to generate funds to finance the construction of low- and medium-cost houses.

Outgoing state Housing Minister Datuk Michael Manyin said the new policy had been introduced because the Federal Government stopped giving bridging loans for low-cost housing projects and end-financing to housebuyers two years ago.

“This has caused delays in housing projects,” he said before handing over duties to his successor Datuk Abang Johari Tun Openg here yesterday.

Manyin, the new state Environment and Public Health Minister, said the Sarawak Housing Development Corp was now putting up low- and medium-cost units for sale during the launch of new housing schemes.

He said once a project was implemented, financial institutions would provide bridging loans progressively to the developers and end-financing to housebuyers.

Manyin said the Federal Government had previously provided buyers of low-cost units with end-financing at 5.5% interest per annum for up to 25 years. Now, they are charged by banks according to base lending rates.

During dialogues with banks, he said, the Housing Ministry had told them there was little risk in providing loans to housebuyers as low-cost units were highly subsidised by the state government.

“A unit is priced not more than RM47,000. A unit costing that much is valued at about RM67,000 because of the government subsidy,” he said.