KUALA LUMPUR: Perbadanan PR1MA Malaysia, tasked with building affordable, quality homes for the people, expects to leverage the weak economic activity to rope in more private property developers to work with it under the 1Malaysia People’s Housing Project.
Describing the revised Budget 2015 as a “good tactical move” by the government in light of falling world oil prices, PR1MA chief executive officer Datuk Abdul Mutalib Alias said the slower growth forecast and fiscal consolidation create opportunities for PR1MA on two fronts.
“The first front is, homebuyers will start to realise that they better look closer and register for PR1MA homes,” he told a senior editors’ briefing here yesterday.
To date, some 890,000 homebuyers have registered for PR1MA homes nationwide.
“The second front is that some of the private developers, who have embarked on their own development initially, in light of what is happening [to the world economy], may now say, ‘Hang on. Let’s work together with PR1MA’,” he said.
PR1MA has three business modules in making sure it meets the mandate of delivering 80,000 affordable homes per year, and with each unit priced below RM400,000. The most popular module is to work together with the private developers.
Under this module, the developer will build the houses, and PR1MA will buy them en bloc, as this will shield the developer from financial risk. However, the developer will have to offer a price that is 20% lower than the market price.
The other two modules are:
PR1MA becomes the developer itself and hires contractors to build homes on government land; while the other is that PR1MA enters into joint ventures with other developers to build homes.
PR1MA began operations in March 2013, but will only deliver its first 600 affordable homes by year-end as it takes 24 months to build a landed house and 36 months to build high-rise units.
Abdul Mutalib said the units were from projects in Bertam, Penang and Kuala Ketil, Kedah, with 300 units respectively.
As of Dec 31, 2014, PR1MA approved 105,562 homes under 74 affordable housing projects to be developed.
He said the company on Jan 15 opened for application seven PR1MA projects located in Kuala Lumpur, Perak, Kedah, Melaka and Johor, and the response has been overwhelming. The balloting for these projects will be carried out earliest in March.
Buyers must have household incomes of between RM2,500 and RM10,000, he said.
Abdul Mutalib said another 14 projects will be opened for application in the second and third quarters of this year.
To date, PR1MA has announced 14 projects in central peninsula, seven in southern peninsula, 15 in northern peninsula, three in the east coast, three in Sabah and two in Sarawak.
He added that a new rent-to-own scheme and PR1MA care scheme for prospective housebuyers who fail to secure bank loans will be unveiled in the near term, but did not elaborate.
This article first appeared in The Edge Financial Daily, on January 23, 2015.