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Can Malaysia’s National Affordable Housing Policy Guarantee Housing Affordability of Low-Income Households?

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  • Jian Liu

    (School of Architecture, Tsinghua University, Haidian District, Beijing 100084, China)

  • Huay Ying Ong

    (School of Architecture, Tsinghua University, Haidian District, Beijing 100084, China)

Abstract

Housing affordability is a long-held issue in Malaysia, and housing policies have been implemented for low-income households over the years. However, there is a contradiction that housing affordability of low-income households has not been met, while the bulk of affordable housing is still vacant. In 2019, Malaysia enacted the National Affordable Housing Policy (DRMM) which was intended to improve housing affordability for low-income groups. This paper aims to answer why Malaysia’s long-term implementation of affordable housing policies cannot guarantee housing affordability, and whether the DRMM can effectively improve housing affordability as expected, by comparing the empirical factors of housing affordability. A literature review and a comparative analysis are adopted in the research. The paper concludes that low household income, high land price, construction cost and compliance cost, mismatch of supply and demand in terms of quantity, the instability of the national economy, low home financing ability, and incomprehensive housing planning have caused low housing affordability of low-income groups in Malaysia. The DRMM as anticipated can improve housing affordability by supplying affordable housing more precisely, lowering housing costs, and improving home financing ability. However, the exclusion of household income and economic factors may cause the ineffectiveness of the DRMM in improving housing affordability for low-income households.

Suggested Citation

  • Jian Liu & Huay Ying Ong, 2021. "Can Malaysia’s National Affordable Housing Policy Guarantee Housing Affordability of Low-Income Households?," Sustainability, MDPI, vol. 13(16), pages 1-19, August.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:16:p:8841-:d:610267
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    References listed on IDEAS

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    1. Noralfishah Sulaiman & David Baldry, 2005. "Can Low Cost Housing in Malaysia be Considered as Affordable Housing ?," ERES eres2005_328, European Real Estate Society (ERES).
    2. Mingchen Duan, 2011. "Investigation on housing affordability in Lanzhou, Northwest China," International Journal of Housing Markets and Analysis, Emerald Group Publishing Limited, vol. 4(2), pages 180-190, May.
    3. Joe Tak-Yun Wong & Eddie Hui & William Seabrooke & John Raftery, 2005. "A study of the Hong Kong property market: housing price expectations," Construction Management and Economics, Taylor & Francis Journals, vol. 23(7), pages 757-765.
    4. Michael McCord & Stanley McGreal & Jim Berry & Martin Haran & Peadar Davis, 2011. "The implications of mortgage finance on housing market affordability," International Journal of Housing Markets and Analysis, Emerald Group Publishing Limited, vol. 4(4), pages 394-417, October.
    5. Andrew Worthington & Helen Higgs, 2013. "Macro drivers of Australian housing affordability, 1985-2010," Studies in Economics and Finance, Emerald Group Publishing Limited, vol. 30(4), pages 347-369, September.
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    Cited by:

    1. Mikio Yoshida & Haruka Kato, 2022. "Housing Affordability of Private Rental Apartments According to Room Type in Osaka Prefecture," Sustainability, MDPI, vol. 14(12), pages 1-13, June.
    2. Emmanuel Joseph Odoyi & Kirsikka Riekkinen, 2022. "Housing Policy: An Analysis of Public Housing Policy Strategies for Low-Income Earners in Nigeria," Sustainability, MDPI, vol. 14(4), pages 1-27, February.

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