Environment
April 17, 2024
Affordable Housing for Penangites
As cities develop and job opportunities increase, more and more people are enticed to set up home in cities in hopes for a brighter future. The problem is that not many people can actually afford their own homes. Housing poverty in Malaysia is a subjective definition relating poverty to the inability to meet the minimum requirement of ownership of housing or maintaining its physical efficiency1. To own a place in the city is just too expensive.
According to the National Property Information Centre (NAPIC), the total number of unsold residential properties across Malaysia in Q2 of 2021, stood at 181,460 units2. 74% of this total were priced at more than RM300,000, making them out of budget for most of Malaysia’s low – mid-income buyers. The states with the highest number of unsold houses were Johor (24%); Kuala Lumpur (20%); Selangor (18%) and Penang (8%)2. Many middle-income earners were unsatisfied with the living standards in Malaysia, primarily Penang.
Key Issues Affecting Penangites' Access to Affordable Housing
Unrealistic Property Prices
Penang had a total of 448,700 households in 20193. Of the total population in the state, 78.9% were homeowners, 19.7% opted to rent and the remaining 1.4% lived in low-cost quarters subsidised by the government3.
- The low to middle-income bracket of Penang’s population are faced with challenges in purchasing a new home. Market price in the state, on both island and the mainland are extremely expensive compared to other states1. With the median house price and the estimated maximum price of an affordable home, (monthly median household income in the respective states) residential house in Penang are deemed as unaffordable4.
- Among the key city centres, houses were most unaffordable in George Town. George Town’s estimated median house price of RM600,000 is much higher than the estimated maximum price of an affordable home at RM294,000, based on its monthly median household income of RM5,4774.
- The location of houses on Penang island is important as residential buildings on the island are roughly double the cost of those living on the mainland. For example, in 2014, the cheapest two-storey terrace house located in Barat Dara, was priced at RM752,3871. In Seberang Perai however, the cost of houses was between Rm301,500 to Rm340,513. Apartments on the island cost between Rm481,250 to RM662,667 per unit. The cheapest form of housing were low-cost apartments priced at RM78,501 per unit1.
- The cost of these units did not decrease between 2009 and 2014 and this is a strong indicator that property prices will continue to soar in the future. The unaffordable cost of housing will continue among low to middle income earners forcing Penang’s inhabitants to either rent, purchase units further away from the city or settle for low-cost housing units1.
More PPR Units For Penangites
Penang’s low-cost housing options can be categorised into two; low-cost apartments by private developers or flats in the government’s Projek Perumahan Rakyat (PPR) housing. A typical PPR unit in Penang consists of three bedrooms, one living room, one kitchen and two toilets, roughly 700sq feet in size (slightly smaller than a PPR unit in Klang Valley). In order to qualify for these apartments, the tenant cannot have a salary higher than RM750 (single) or RM1,500 (household) and have to be native to the state5.
- To rent a PPR unit, it will cost approximately RM100 monthly plus RM24 for maintenance. As the majority of the government efforts are to aid low-income families in purchasing a home, these flats are sold between RM35,000 to RM200,0005.
- Low-income households can also be enlisted under the Rumah Mampu Milik Project where the Penang state government organises a supply of affordable homes priced between RM 42,000 (650sq feet) to RM 300,000 (900sq feet) for households earning between RM2,500 to RM10,000 a month. The choice of units vary in location and size and are scattered across the island6.
- In 2021, the federal government announced that 114,652 PPR units were available for Malaysians but only 999 units were available to Penang people<7. PPR applications in Penang can take up to 11 years. This lengthy wait coupled with limited PPR units make it even more difficult for low-income households to own a home8. The long wait and uncertainty has caused a lot of families to rent elsewhere using money they have to pay rent instead of instalment of their own unit8.
- In the end, low-income families are still willing to wait it out of PPR conditions and accessibility is considered one of the best in the nation. PPR’s are equipped with access to piped water through their homes (99.9%), access to garbage collection services (79.9%), and most of them are within a five-kilometre radius of a school (100%) or public health centre (100%)3. The opportunity to own a PPR unit allows families to live more decent lives. The state’s average Poverty Line Index is RM1,989 per month, with the food poverty line index alone taking up RM1,0043. Low income families living in Penang are struggling to survive and settle down.
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Caring For Penang Ageing’s Population
Affordable Housing For Penangnites (coming soon)
Greater Inclusivity For The Migrant Population (coming soon)
Explore Our Sources
- Y. Haizzan, R. Firdaus, M. S. Samsurijan, A. Rais, A. R. A. Latiff, P. S. J. Singh, J. Singh, M. H. Jaafar, K. Vadevelu. (2018). Urban Poverty and Housing: Social Work Issues. International Journal of Academic Research in Business and Social Sciences.
- Housing Watch. (2021). Housing Market Development. Unsold Residential Properties.
- DOSM. (2020). Household Income and Basic Amenities Survey Report By State and Administrative District. Pulau Pinang. 2019.
- Housing Watch. (2020). Housing Market Development. Housing Affordability.
- KPKT. (2020). Program Perumahan Rakyat.
- Permohonan.my. (2021). Permohonan eRumah Pulau Pinang Online.
- Buletin Mutiara. (2021). Penang Gets Less than 1% of PPR Units from Fed Govt.
- P. Nambiar. (2019). Give us chance to stay at Penang PPR, applicant tells campers at Komtar.