Housing unaffordability issue could spread to other parts of the country if left unchecked, Khazanah Research Institute

KUALA LUMPUR: Housing unaffordability could become an issue in other parts of the country if it is not addressed, said Khazanah Research Institute (KRI) managing director Datuk Charon Mokhzani.
"If we don't start tackling the problem now, what's happening in Penang and Kuala Lumpur could start happening in other parts of the country because you'll have more and more people, urbanisation is increasing, so there's more demand for property. If you don't fix it now you'll have a much bigger problem in the future," he told reporters at a forum entitled "Does greater prsoperity come with less housing affordability?" organised by the Malaysian Economic Association today.
Last month, KRI launched a report on affordability, which revealed that Malaysian houses are severely unaffordable, especially Penang and Kuala Lumpur.
"At the moment the problem isn't there yet because there are enough houses but as more people move from the countryside to the city, they need houses built for them in the urban area. That's the problem we have to address," said Charon.
He said providing more housing loans to buyers will not solve the issue of affordability as it would increase debt burden thus the solution is to reduce house prices.
"We have to build houses as cheaply as possible and as many as possible so that we can meet this demand. It can be done. As we heard from developer point of view, if we manage to implement better ways of building houses for example industrial building system (IBS), then we can have more houses and hopefully at a price that everybody can afford," he added.