The government has been advised to set stricter policies for developers, such as requiring them to sell at least 15% of completed residential units before approving new construction projects.
This is to reduce housing overhang and to ensure there is no oversupply in the market.
According to a report by BERNAMA, Dr Muhammad Iqmal Hisham Kamaruddin, a senior lecturer at the Faculty of Economics and Muamalat at the Universiti Sains Islam Malaysia, said that this move is necessary to overcome the issue of unsold houses priced between RM300,000 to RM500,000.
“To balance oversupply, the government can enforce stricter regulations, such as making approvals for new residential development projects subject to the existing property overhang in a given area,”
“For example, if the number of unsold residential units exceeds 15% in a particular area, the government should tighten approvals by not allowing new residential construction until the number of unsold units decreases,” he said.
Why build more houses when there are so many unsold ones?
Houses priced between RM300,000 and RM500,000 were recorded as the most unsold property component in the country in the 3rd quarter of 2024.
These unsold units represent 31.9% of the property market segment, comprising 7,003 units and valued at RM2.78 billion in 2024.
Due to this, Dr Muhammad Iqmal also urged the government to ensure that property prices correspond to the affordability and average income of the locals in the area.
For example, if the average household income in the state allows for purchasing property worth RM500,000, then houses there should be offered at prices not exceeding RM500,000.
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