8 Promising Initiatives For Affordable Homes In 2022

By: Fahri Ahmed
3rd Feb 2022
Property News

The median price of houses in Malaysia is RM 300,000 as of the first quarter of 2021 as per National Property Information Centre (NAPIC).

Based on a Household Income and Basic Amenities Survey in 2019, a B40 household in Selangor earns up to RM 7,000 making them eligible to buy houses priced RM 252,000. On the other hand, a M40 household earning between RM 7,000 to RM 15,000 can afford to buy houses worth up to RM 540,000.

Looking at the income of B40 and M40 households, the Malaysian property industry falls short in affordable housing. While developers are launching multiple new projects every year, the average person cannot afford them. To create a wider market for first time home buyers and those with constrained budgets, new collaborations are taking place to offer affordable housing.

While some people are looking to buy houses to move in right away, others are planning for their future homes. To cater to both types of buyers, 2022 has some promising launches in the pipeline. Some of these projects will be completed in 2022, ready for purchase. Then there are others which are still under construction. Buyers can take time paying for their houses, which will be ready in the upcoming years.

Here is a list of 8 promising collaborations for affordable housing in 2022:

1. LAND & General Bhd (L&G)

LAND & General Bhd (L&G) is aiming to build affordable homes for first time buyers. Their houses expect to cater the needs of the youth who are unable to buy houses due to high selling prices.

Low Gay Teck, the Managing Director of L&G expects the property market to slowly regain its composure in the next quarter. They are positive about the property outlook in 2022 after facing heavy uncertainty in 2020.

Presently, L&G has 3 ongoing projects under its belt:

    • Astoria Ampang Phase 1 in Selangor
    • Sena Parc Phase 1A and 1C in Senawang, Negeri Sembilan
    • Damansara Seresta situated next to Bukit Lanjan Forest Reserve in Bandar Sri Damansara.

They also have 2 upcoming projects in hand:

    • Astoria Ampang Phase 2
    • Sena Parc Phase 1D.

Their net profit rose by 28.6% to RM 6.99 million from RM 5.44 million between Q1 2020 to Q2 2021. They believe their gross development value (GDV) for the planned launches will be more than RM 450,000 in the future. Hence, it can be expected that the residential units can benefit buyers looking for affordable homes with a good turnover in the future.

2. Rumah Idaman in collaboration with MGB Berhad and LBS Group.

The Selangor State Government announced the Rumah Idaman project to provide affordable housing. According to Datuk Seri Amirudin Shari, Selangor Menteri Besar, the projects will cater to people who are staying and working in Selangor or buying their first homes there.

The project aims to build houses priced as low as RM 250,000 from November 2021 in collaboration with MGB Berhad and LBS Group.

Currently, 6 Rumah Idaman projects are in the pipeline, strategically located at:

    • Saujana Putra
    • Shah Alam 2
    • Cybersouth
    • Puchong
    • Alam Perdana

The houses built under the project will have easy accessibility to highways, schools, hospitals, universities and other amenities. Their average size will be 1000 square feet comprising 3 bedrooms and 2 bathrooms. As an additional perk to buyers, the houses will be furnished with a television with cabinet, fridge, 3 air conditioning, water heater in each bathroom, kitchen cabinets and wardrobe. The projects will be in full construction mode in 2022 and will be ready to move in within 2024.

3. Perbadanan PR1MA Malaysia in collaboration with Sinergi Dayang Sdn Bhd.

Perbadanan PR1MA Malaysia (PR1MA) signed a joint development agreement (JDA) with Sinergi Dayang Sdn Bhd (Sinergi Dayang) to develop affordable homes in Pahang.

PR1MA is an initiative of the Ministry of Housing and Local Government (KPKT) to provide houses to Pahang residents at low cost. On the other hand, Sinergi Dayang is a wholly-owned subsidiary of WZ Satu Bhd.

The companies collaborated to build 763 units of 2-storey terraced houses. They are part of the Residensi D’Marina Phase 2 in Kuantan, Pahang. The project will include amenities and relevant infrastructures and will be broken down into 6 sub-phases for completion. The construction work for the project will start in July 2022 and intend to be completed by 31 December 2026.

Those who are seeking to move into their new home in a few years’ time can consider this project. It not only offers affordable living but will also have an appreciated gross development value (GDV) of RM 219 million in 4 to 5 years.

4. EcoFirst Consolidated Bhd

EcoFirst Consolidated Bhd is another company that has come forward in building affordable homes for Malaysians. Datuk Tiong Kwing Hee, Group Chief Executive Officer of the company believes that 2022 will be a challenging year with the property industry seeing a gradual recovery around the second quarter.

They identified the gap of reasonable residential housing in Malaysia especially in Klang Valley. So, they are focusing on prime location development, creating price sensitive homes for Malaysians.

The boutique property developer has a stable business with net asset per share at 42.16 sen per share as of 31 August 2021. They are in a healthy state to keep up their promise of developing the houses on time, which will cost below RM 500,000 per unit.

5. Ireka Development (Terengganu) Sdn Bhd (IDTSB) in collaboration with Koperasi Permodalan Sahabat Terengganu Bhd (PSTB).

Ireka Development (Terengganu) Sdn Bhd (IDTSB) is a wholly owned subsidiary of Ireka Corporation Bhd (ICB). The development company received a letter of award (LoA) from Koperasi Permodalan Sahabat Terengganu Bhd (PSTB) for a RM 58.3 million development project in Terengganu.

IDTSB is appointed as the co-developer for the project to develop affordable and mixed development houses. The houses will stretch upon 9.75 hectares of land strategically located in Kampung Baru Kuala Abang, Mukim Kuala Abang, Daerah Dungun in Terengganu.

The buildings in Kuala Abang will comprise 284 residential units and 5 commercial units. The residential houses will be built with the B40 segment in mind, breaking into 3 different types; Type A will consist of 61 units, Type B will have 93 units whereas Type C will have 130 units of single storey terrace houses.

Their new management team and new strategies over the past 5 months have increased their order book from RM 470 million to over RM 1.36 billion. Thus, they expect to complete the project in time. Starting construction on 20 December 2021, they intend to complete the project within 3 years, on 19 December 2024.

6. Mah Sing Sdn Bhd

Mah Sing is an old player in the property industry with many successful projects in their name. They aspire to be Malaysia’s leader in providing homes with reasonable prices. Naming their affordable housing project ‘M-Series’, they are encouraging home buyers to purchase houses without straining their finances.
Under this project, each house will be around 700 square feet in size with premium features in strategic locations. Mah Sing’s strong run in the market ensures confidence that they will deliver these projects in due time. Their gross development value (GDV) and unbilled sales is around RM 24.45 billion, which is expected to provide them earning visibility for a minimum of eight years.

7. Inta Bina Group Bhd is awarded the housing contract by Eco Majestic Sdn Bhd.

Inta Bina Group Bhd achieved a RM 79.8 million contract to build 149 double storey homes in diverse sizes. The contract has been awarded to its subsidiary, Inta Bina Sdn Bhd by Eco Majestic Sdn Bhd.

The houses will be built as a part of a gated and controlled community housing scheme (strata property) in Hulu Langat, Selangor. The project also comprises two power stations. Starting construction on 5 January 2022, they intend to get the houses ready within 20 months.

8. Haily Construction Sdn Bhd (HCSB) accepted a letter of award (LoA) for affordable housing from Nice Frontier Sdn Bhd (NFSB).

Haily Construction Sdn Bhd (HCSB) is a wholly-owned subsidiary of Haily Group Bhd (HGB). They have been awarded a letter of acceptance (LoA) by Nice Frontier Sdn Bhd (NFSB) worth RM 14.57 million.

NFSB is a member of the IOI Properties Group Bhd and the project involves building affordable housing in Kulai, Johor. The project will lead construction of 216 strata townhouses at 20 x 60 feet comprising a management office and a Tenga Nasional Bhd (TNB) sub station.

HGB has 22 construction projects in their pipeline with two civil engineering related construction projects. See Tin Hai, the executive director of HGB says this project from NFSB will keep them busy for the next 16 months and contribute to their earnings for the year ending 2022 and 2023.

These eight new collaborations from the developers are expected to decrease the shortage of affordable housing in the coming years. They will add to a better community with more people having the ability to buy homes within their price range.

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