The Malaysian government’s budget for 2024 should include measures to help the rakyat and strengthen the middle class, especially via a focus on housing affordability, according to a report released today by Juwai IQI Co-Founder and Group CEO Kashif Ansari.
Mr Ansari said, “We hope Budget 2024 will help more families achieve affordable home ownership. When a family is insecure in their home, they experience all kinds of other negative impacts, from lost income to worse educational outcomes for their children. “This and past governments have already shown a commitment to helping people of all income levels afford their own homes. The property industry hopes Budget 2024 will contain new commitments so that more Malaysians can realise the dream.
Measures That Could Support Homeowners
“To have stable finances, families need four things: reliable income, low expenses, the ability to save for the future, and security in their home. Affordable home ownership helps achieve three out of four of these goals. It reduces and stabilises your monthly expenses, gives you a vehicle for accumulating savings, and guarantees you always have a good roof over your head. “Budget 2024 could contain a range of measures to help more families achieve affordable home ownership. First, you can ensure families have more money in their pockets by reducing taxes on middle-income families. With more disposable income, families will be better able to afford their own homes.
“The government can also take a more targeted approach. It can provide grants for home buyers, subsidise lower interest rates for members of lower- and middle-income groups, and reduce thetaxes and stamp duties buyers must pay when buying or taking out a mortgage.
“One successful program the government can reinstate is the Home Ownership Campaign. The last numbers indicate that HOC helped families save RM15.8 billion over what they would otherwise have paid in purchasing 117,538 HOC homes. Total HOC sales added up to RM92.5 billion as of July 2022. By any measure, HOC has been a success and helped more than 100,000 families set themselves on the path to financial independence. “One final measure Budget 2023 could pursue is to reduce the cost of new construction. The BCISM’s data shows that Portland cement costs were 50% higher in September than a year ago.
Ready-mixed concrete costs are up by 23%. The cost of sand is up 18%. When prices rise quickly on the materials fundamental to every construction budget, it leads to more costly new homes. When cement and rebar prices go up, homes become less affordable. The BCISM is the group that provides cost information to Malaysian construction industry players.
“The government has tools to reduce these input costs. Many materials are either imported or rely on imported ingredients or components. By reducing import levies, Budget 2024 can make housing more affordable.
“Budget 2024 can do many things to help more families achieve financial independence through the affordable ownership of their own homes. We support these measures and look forward to a wealthier future for all Malaysians.
