There’s a danger that affordable homes could be the next big overhang if overbuilt.
Like the proverbial adage of having too many cooks spoiling the soup, the rush to build too many affordable homes in Malaysia without knowing what the actual demand is might serve to create the next big overhang.
This could cause the next critical glut as the lack of coordination among the state and federal agencies, and property developers have triggered worries of overbuilding and further dampened the recovery of the already reeling housing sector.
“Whenever there is too much of something over and above what is needed, an imbalance occurs. That has been so for the overhang situation right now where units are unsold due to either a pricing mismatch, a location mismatch or a product mismatch.
“The lack of real-time and transparent data also complicates the decision making for new projects. With regards to the affordable homes segment, a pertinent factor is the interpretation or definition of an affordable home,” said Rahim & Co International Sdn Bhd executive chairman Tan Sri Abdul Rahim Abdul Rahman. Presently, various parties are involved in the construction of affordable homes which could ruin the overall supply in this segment.
Media Title: The Star
Date: 18 Sep 2020