Revolutionising Malaysia’s Housing Sector

Malaysia’s economy is set for robust recovery this year, with growth projected between 4-5% according to Bank Negara, echoed by Finance Minister II Datuk Amir Hamzah. This outlook is supported by strong rebounds in key economic indicators, including trade and export figures in the first quarter.

The surge in economic activity is evident in the nationwide construction sector, with new infrastructure projects, rail links, and investments in industrial parks and data centres creating numerous job opportunities.

Notably, the country’s unemployment rate has also steadily been on the decline, reaching a near-record low of 3.3% in April 2024, as reported by the Department of Statistics. The vibrant economic conditions have also led to an increase in property purchases, highlighting the high demand for home ownership.

While we attest, that Malaysia’s property sector remains resilient and affordable, the desire to own a large ticket item like a house is every Malaysian’s dream. However, with many living in cities, the pursuit of owning a property closer to their workplace is becoming more and more difficult due to rising property costs and limited land.

And then there is also a new generational shift in thinking, whereby the new breed is looking differently when it comes to home, and location while it no longer matters, they are more concerned about the surroundings, amenities and environmental aspects.

With all these pertinent questions needing answers, BusinessToday turned to the one person who could give a broad perspective on the country’s housing strategy for all Malaysians today and for the future.

In an exclusive interview, we managed to catch up with the affable Housing and Local Government Minister Nga Kor Ming who was more than glad to address some of the pressing issues plaguing the country in terms of housing and yes even toilets!

Since taking over the ministry in 2022, Nga has quickly adapted to the role, first changing the ministry name to reflect the role it represented and implementing significant changes that have even earned the ministry recognition as one of the best-performing in the cabinet.

A lawyer by profession and a former Deputy Speaker, Nga shared some key people-centric initiatives he has introduced, demonstrating his unwavering commitment to improving the lives of Malaysians through effective governance and innovative solutions.

A Social Mission

Since his appointment, Nga — who preferred to be known as “KM” has overseen a significant transformation in Malaysia’s approach to housing and urban development. Under his leadership, the Ministry has rebranded from the Local Government Development Ministry to the Housing and Local Government Ministry, reflecting its broader and more integrated responsibilities.

On the impactful initiatives and reforms implemented to address housing affordability and improvement in quality for all Malaysians, he explained that the Ministry’s jurisdiction from managing public housing, local government, town and country planning, solid waste management, national landscaping and even the fire brigade, the 8 departments, 4 agencies managed by the Ministry play a crucial role in ensuring the welfare and safety of the public.

“Our initiatives affect people’s daily lives profoundly,” Nga stressed.

In just under two years, the Ministry has launched over 30 initiatives. Notably, it is the first ministry to publish an annual report card, which is a testament to its commitment to transparency and accountability, he said.

The 2023 report, endorsed by the King, Sultan Ibrahim, and recognised by the Prime Minister’s Office, ranks the Ministry as the second-best performing ministry in Malaysia, earning itself a prestigious platinum status.

One of the Ministry’s primary goals is to achieve 100% home ownership for Malaysian households. Currently, 76.9% of households own a home, and the Minister says efforts are ongoing to increase this figure.

To achieve this ambitious goal, Nga has outlined several initiatives to make homeownership more accessible.

Among them is Stamp Duty Exemptions, where first-time homebuyers purchasing homes below RM500,000 receive a 100% stamp duty exemption. This initiative valid until 31 December 2025.

Next is the Skim Jaminan Kredit Perumahan (SJKP): The credit guarantee scheme has been expanded from RM5 billion to RM10 billion, assisting over 53,000 homebuyers in securing bank loans.

And the Program Residensi Rakyat (PRR): Set to launch in 2025, PRR offers a modern public housing model inspired by successful international examples, including Singapore’s HDB. These units, costing RM300,000 to build, and will be proposed to sold at a heavily subsidized price of RM60,000, ensuring affordability for all targeted group.

Reforms And Collaborations

Recognising that housing solutions require a united approach, the Ministry has collaborated closely with state governments, local councils, and the general public. This collaborative spirit ensures the successful implementation of nationwide initiatives like PRR.

To further protect homebuyers, the Ministry is updating the outdated Housing Development (Control and Licensing) Act 1966. The new Real Property Developers Act 2025 will extend regulations to all real estate sectors, including commercial properties and shopping malls and also the development of wakaf (endowment) land, ensuring that such developments are fair and beneficial to all stakeholders.

Key provisions include among others, Option to Purchase: This new provision will secure the buyer’s right to purchase properties under specified terms, Escrow Accounts: To safeguard funds, developers must maintain Housing Development (HD) accounts that the Ministry can access to complete abandoned projects and Developer Accountability: where Developers found guilty of fraud will face stringent penalties, including imprisonment and hefty fines. Their ability to travel and use proxies to evade the law will be restricted.

The reform of the Act will also require developers to adhere strictly to their promotional materials. This means that the quality and features advertised must match what is delivered. Malaysia’s real estate industry, already recognized for its excellence, will benefit from these measures, ensuring fairness and transparency.

Nga proudly noted Malaysia’s achievements on the global stage, with Malaysian developers winning six out of 14 categories at the FIABCI World Gold Medals Award this year, including the best shopping mall in the world.

“We aim to reward the good and punish the culprits,” said Nga. “A good government is fair, transparent, and balanced.”

While the Minister acknowledged the task ahead, mid-way through his term, he is ever optimistic and looks committed to addressing every area under his ministry and making positive changes.

Reforming Legacy Hurdles

Another critical legislative reform in progress is the amendment of the Strata Property Management Act 2013. Currently, urban redevelopment requires unanimous consent from all property owners, which is often unachievable. The proposed amendment Minister Nga says, will reduce the consent threshold to 80% for buildings less than 30 years old and 75% for older buildings. For abandoned and unsafe projects, only a simple majority of 51% will be needed. This reform is crucial for enabling urban renewal and addressing abandoned projects, providing more robust protection for purchasers.

Another issue plaguing the industry is the Residential Tenancy Act, here the minister is proposing new legislation.

The Residential Tenancy Act (RTA): Aimed at balancing the rights and responsibilities of landlords and tenants, the RTA will introduce standardised tenancy agreements and protections for both parties, ensuring fairness and clarity.

Recognising the importance of expert input and public engagement, the Ministry has established a Panel of Experts (POE). Minister Nga emphasises the importance of open governance, and implementing a three-open policy: open door, open mind, and open heart. This approach fosters transparency, inclusivity, and innovation in policy-making.

“We are moving forward with reforms that will benefit all Malaysians,” said Nga. “Our goal is to ensure that every citizen has access to affordable, high-quality housing in a transparent and fair system.”

With these transformative initiatives and reforms, Nga said Malaysia is on the path to ensuring every citizen has access to affordable, high-quality housing.

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