Address wealth gap among ethnic groups, academic says on national housing policy

The wealth gap between classes and ethnicities in the country will widen further if housing affordability issues are not properly addressed, a researcher says amid soaring house prices. 

Speaking to MalaysiaNow, Nizam Mahshar said that the country's development plans overlook the demographic concerns of a multi-ethnic society as well as the disparities in income levels.

"It is also linked to political funding. Some politicians do not safeguard the people's interests because they are influenced by developers who lobby for political funds.

"That is why we see parties closely associated with property developers even being referred to as 'developer parties'. There must be some basis for such perceptions in society," he added.

Nizam, of the International Development and Research Institute in Sustainability, said this situation leads to uncontrolled house prices in urban areas, making it difficult for low-income groups, predominantly the Malays, to afford them.

He said this results in an imbalanced demography where non-Malays tend to concentrate in urban areas while Malays are forced to seek properties outside of cities and towns in suburban areas.

This, in turn, leads to a more evident ethnic political polarisation, especially in urban areas, which are economic centres.

He cited the situation in Penang, where he said an increasing number of Malays are moving to Seberang Perai, Sungai Petani, and Kulim due to property price pressures, leading to an imbalanced demographic on the island.

Recent reports indicate a projected 25% increase in house prices for properties valued at RM500,000 and above. The Malaysia House Price Index increased by 2.8% last year, with terraced houses, high-rise apartments, and semi-detached houses registering increases of 3.7%, 3.4%, and 2.9%, respectively.

This contradicts the per capita increase in gross domestic product, which is only half of the housing price increase.

"Housing costs have risen at least twice as much as the people's economy," Nizam said.

Recently, Local Government Development Minister Nga Kor Ming announced that the National Housing Policy (NHP) would be reviewed to achieve the target of providing 500,000 affordable houses by 2025.

According to the ministry's statement, the new NHP will take into account the various needs of the people according to their cultures, customs, religions, and scenarios in Malaysia's multiracial society.

Nizam said the ministry must carefully consider the political direction of the NHP to address the housing crisis and not widen the gap between the people.

The former Institut Masa Depan Malaysia CEO added that the absence of regulations would allow developers to sell houses at excessively high prices, targeting outside buyers.

"Housing prices have increased, but developers are not interested in solving the problem by developing affordable homes. This leads to a decrease in the occupancy rate.

"There is a housing supply glut, which opens the door for speculative elements," he added.

Although the country has several government-linked companies involved in housing projects, Nizam said they are too focused on following other developers' trends and pursuing profits, forgetting their responsibility to society, thus making them no different from private developers.

"They can be directed to build more affordable housing, but it requires political will."

Nizam highlighted three components which he said must be considered in this issue: housing policy, local authorities, and types of ownership to address the demographic imbalance of the population according to class, ethnicity, and urban, suburban, and rural divides.

He said ownership rights have become a contested issue among political parties such as MCA and DAP in their efforts to gain support from the Chinese community, giving the example of Seputeh MP Teresa Kok, who fought for freehold status for leasehold landowners in Sri Petaling.

Segambut MCA division was also reported to have pledged assistance to Taman Bukit Maluri residents in Kepong to convert their land title from leasehold to freehold.

Nizam said that permanent ownership will increase property prices and push them beyond the means of the majority of the less privileged communities, especially the Malays.