KRI

Malaysia: HBA proposes price control mechanism to curb rising property prices

KUALA LUMPUR: The National House Buyers Association (HBA) is proposing a housing price control mechanism to curb rising property prices and ease the country’s housing affordability issues.

HBA vice president Datuk Goh Seng Toh said measures need to be put in place to prevent developers from hiking up property prices.

“Some developers have a ‘teh-tarik’ syndrome, where if steel prices increase 10%, house prices go up 10%,” he said at a panel discussion at the launch of Khazanah Research Institute’s (KRI) “Rethinking Housing: Between State, Market and Society” report today.

“However, a house comprises of various materials. But in the housing arena, we have allowed the developers to call the shots!”

Goh said that there were price control mechanisms in place for essential items such as sugar and oil.

“You can cut down your consumption on oil and sugar, but you can’t reduce shelter over your head,” he said.

“A price control mechanism is not totally impossible if you’re serious enough.”

KRI chairman Dr Nungsari Ahmad Radhi however feels that a house pricing mechanism would not be feasible.

“If you impose this on the developer, they will set a floor price and will not sell anything below this price. This will distort supply,” he said.

Rehda President Datuk Soam Heng Choon meanwhile said everyone needs to play a role when it comes to solving the country’s housing affordability issues.

“Everyone must play a role – the government, developers, contractors and even the discipline of the house buyers.

“Everyone feels that it is the developers who are always at fault and only trying to maximise profits.”

According to KRI’s report, housing affordability in the country has not improved significantly between 2002 and 2016, partly stemming from the unresponsiveness of housing supply to effective demand.

“A comprehensive housing agenda needs to move towards guiding and managing the housing sector as a whole, recognising housing as a basic need and a base for asset accumulation,” it said.

Source: https://www.thestar.com.my/business/business-news/2019/04/25/hba-proposes-price-control-mechanism-to-curb-rising-property-prices/#W6DfsdGsJz31pyw5.99