Affordable Housings In Greater Kuala Lumpur (klang Valley) and Urban Malaysia

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Copyright © 2018 ATSA Architects Published by ATSA Architects Sdn Bhd All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without written permission from the copyright owner. Disclaimers The information presented in this report has been assembled, derived and developed from various projects and design proposals carried out by ATSA. These are presented in good faith. The author and publisher have made every reasonable effort to ensure that information presented is accurate. It is the responsibility of all users to utilize professional judgment, experience and common sense when applying information presented in this book. This responsibility extends to the verification of local codes, standards and climate data. Every effort has been made to ensure that intellectual property rights are rightfully acknowledged. Omissions or errors, if any, are unintended. Where the publisher or author is notified of an omission or error, these will be corrected in subsequent editions. Publisher ATSA Architects Sdn Bhd 45 Jalan Tun Mohd Fuad 3 Taman Tun Dr Ismail 60000 Kuala Lumpur Malaysia Website: www.atsa.com.my Email: [email protected] Author Ar. Azim A. Aziz Co-Author and Designed by Mohamad Haziq Zulkifli 2 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

TABLE OF CONTENTS Pages 5.5.1 Numbers of Affordable Housings that Greater Pages 4 Kuala Lumpur Will Need in The Future 73 List of Tables, Graphs and Figures 7 1.0 ABSTRACT 5.5.2 Land to Build Affordable Housings: 73 5.5.3 Density of Units To Be or Can Be Built in the 74 2.0 INTRODUCTION 8 Greater Kuala Lumpur Area 76 3.0 BACKGROUND STUDIES AND FINDINGS 9 5.5.4 Authority Imposition and Requirements 77 3.1 POPULATION OF MALAYSIA AND GREATER KUALA LUMPUR 9 5.5.5 Future and Predictions 77 5.5.6 Future of Science and Technology in Building 78 (KLANG VALLEY) 15 5.5.7 Working Together 103 3.2 AGEING POPULATION OF MALAYSIA 17 5.5.8 Architectural Design Solutions for Affordable 3.3 DEFINITIONS OF AFFORDABLE HOUSINGS 19 120 3.4 OVERVIEW OF AFFORDABLE HOUSINGS IN MALAYSIA 24 Housings 3.5 AFFORDABLE HOUSING PRICES IN MALAYSIA 25 122 3.6 STATE OF INCOME IN MALAYSIA 27 6.0 FINAL OBSERVATIONS 3.7 GROUP INCOME EARNERS VS HOUSING PRICES 7.0 BIBLIOGRAPHY 4.0 ANALYSIS AND DISCUSSIONS 33 4.1 OVERVIEW OF AFFORDABLE HOUSING IN GREATER 33 KUALA LUMPUR 34 4.2 FUTURE INCOME GROUP EARNERS 40 4.3 CASE STUDY: PUBLIC HOUSING IN SINGAPORE 41 4.4 HOUSING PRICES AND CONSTRUCTION COST IN GREATER 59 KUALA LUMPUR 4.5 GROWTH PERCENTAGE OF HOUSING SUPPLY AND 61 62 AVAILABLE HOUSING UNITS IN GREATER KUALA LUMPUR 4.6 SURPLUS OF HOUSING SUPPLY 4.7 PREDICTION OF HOUSING SUPPLY IN GREATER KUALA LUMPUR 5.0 CONCLUSIONS AND RECOMMENDATIONS 68 5.1 CHALLENGES 68 5.2 POSITIVE APPROACHES 69 5.3 CONTRIBUTORY FACTORS ON RISING COSTS OF AFFORDABLE 69 HOUSES 69 5.4 APPROACHES TO CONTROL THE CURRENT HOUSING PRICES 71 5.5 RECOMMENDATIONS 3 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

LIST OF TABLES Pages Table 2.11: Cost breakdown for T20 terrace house Pages 44 Table 1.1: Total household income, population and living 10 Table 2.12: Cost breakdown for T20 semi-D house 45 quarters (houses) in the Greater Kuala Lumpur and Malaysia in Table 2.13: Cost breakdown for T20 bungalow house 46 2016 10 Table 2.14: Cost breakdown for M40 house 47 13 Table 2.15: Cost breakdown for B40 house 48 Table 1.2: Malaysian population from 1957 to 2100 Table 2.16: Housing construction cost in Kuala Lumpur in 51 14 2015 52 Table 1.3: Population of Greater Kuala Lumpur from 1957 to Table 2.17: Average house prices in Kuala Lumpur from 53 2100 15 1999 to 2016 59 16 Table 2.18: Average house prices in Selangor from 1999 60 Table 1.4: Population growth assumption of Greater KL and to 2016 62 Malaysia from 1957 to 2100 17 Table 2.19: Number of existing houses in Greater Kuala 64 18 Lumpur 65 Table 1.5: Malaysian age groups from 1957 to 2100 24 Table 2.20: Houses supply in Greater Kuala Lumpur 66 25 Table 2.21: Assumption of housing supply in Greater Table 1.6: Population growth and immigration rate in Malaysia 26 Kuala Lumpur from 2020 to 2100 81 from 1957 to 2100 Table 2.22: Population of Greater Kuala Lumpur from 28 2010 to 2020 10 Table 1.7: Housing price affordability rating Table 2.23: Assumption demands of affordable housings 33 from 2020 to 2100 11 Table 1.8: Pricing ranges of various affordable housings Table 2.24: Sample units of affordable housings. 34 Affordability level is measured based on the income 13 Table 1.9: Pricing ranges of low cost and affordable housings requirements and offered prices 35 Table 3.1: Mercer Quality of Living Rankings 2017 Table 1.10: Income, housing price and affordability level 36 LIST OF GRAPHS Table 1.11: Median monthly household income of Malaysian Graph 1.1: Malaysian population from 1957 to 2100, and Greater Kuala Lumpur population 36 based on data projection by Department of Statistics, Malaysia and UN Department of Economic and Social Table 1.12: Population percentage of income groups in urban 37 Affairs Malaysia 38 Graph 1.2: Graph of the Malaysian population from years 1950 to 2100, with the low variant stands at 26 Table 2.1: Median household income of Malaysia and Greater 39 million, 41 million (medium variant) and up to 62 million Kuala Lumpur (high variant) in the year 2100 (UN Department of 41 Economic and Social Table 2.2: Percentage of income groups in urban Malaysia from 43 Graph 1.3: Population of Greater Kuala Lumpur from 2020 to 2100 1957 to 2100 Table 2.3: Percentage of T20 income group in Malaysian urban population Table 2.4: Percentage of M40 income group in Malaysian urban population Table 2.5: Percentage of B40 income group in Malaysian urban population Table 2.6: Affordable housing schemes in Greater Kuala Lumpur Table 2.7: Comparison data of Greater Kuala Lumpur, Singapore and Hong Kong Table 2.8 : Comparative table of affordable housing schemes in Greater Kuala Lumpur, Singapore and Hong Kong Table 2.9: Project examples of land usage Table 2.10: Cost breakdown for high rise T20 house 4 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Graph 1.4: Population growth assumption of Greater KL and Pages Graph 2.13: Average house prices in Selangor from 1999 Pages Malaysia from 1957 to 2100 14 to 2016 53 Graph 1.5: Malaysian age groups from 1957 to 2100 Graph 1.6: Population growth and immigration rate in Malaysia 15 Graph 2.14: Construction cost against the housing prices 54 from 1957 to 2100 16 in Kuala Lumpur from 2005 to 2015 Graph 1.7: Average land price in Kuala Lumpur from 1957 to 55 2017 22 Graph 2.15: Construction cost against selling price of Graph 1.8: Average land price in Selangor and Negeri bungalow house n Kuala Lumpur from 2005 to 2015 56 Sembilan from 1957 to 2017 23 Graph 2.16: Construction cost against selling price of terrace house n Kuala Lumpur from 2005 to 2015 57 Graph 1.9: Pricing ranges of low cost and affordable housings 24 Graph 2.17: Construction cost against selling price of Graph 1.10: Median monthly household income of Malaysian 26 high rise houses n Kuala Lumpur from 2005 to 2015 58 and Greater Kuala Lumpur population Graph 2.18: Construction cost per square metre in major 59 27 Asian countries Graph 1.11: Percentage distribution of group income earners in Graph 2.19: Growth percentage of housing supply in 61 urban Malaysia 28 Greater Kuala Lumpur from 1991 to 2010 61 Graph 2.20: Percentage of vacant houses in Greater 62 Graph 1.12: Population percentage of income groups in urban 29 Kuala Lumpur from 2000 to 2010 Malaysia Graph 2.21: Factors influencing vacant housing units 65 30 Graph 2.22: Assumption of housing supply in Greater Graph 1.13: Median yearly household income vs housing prices 31 Kuala Lumpur from 2020 to 2100 67 in Kuala Lumpur from 1999 to 2014 34 Graph 2.23: Assumption demands of affordable housings from 2020 to 2100 12 Graph 1.14: Median yearly household income vs housing prices 41 Graph 2.24: Comparison of affordable housing prices 19 in Selangor from 1999 to 2014 42 LIST OF FIGURES 19 Graph 1.15: Malaysian GDP growth from 1960 to 2020 43 Figure 1.1: Malaysian population from 1957 to 2100 Graph 2.1: Percentage of income groups in urban Malaysia 44 Figure 1.2: View of Kampung Baru in Kuala Lumpur circa 20 from 2020 to 2100 45 1960’s 46 Figure 1.3: The former Pekeliling flats in Jalan Tun Razak, K. 21 Graph 2.2: Land use breakdown for affordable housing projects 47 Lumpur 32 Graph 2.3: Total cost breakdown 48 Figure 1.4 & 1.5: View of squatters in Kg Kerinchi, circa 63 Graph 2.4: Cost breakdown for high rise T20 house 49 1990’s, (left) now being replaced by Bangsar South Graph 2.5: Cost breakdown for T20 terrace house development (right) in Kuala Lumpur 75 Graph 2.6: Cost breakdown for T20 semi-D house 50 Figure 1.6: Land Price Per Square Foot (PSF) in Selected 80 Graph 2.7: Cost breakdown for T20 bungalow house Areas of Greater Kuala Lumpur / Klang Valley Graph 2.8: Cost breakdown for M40 house 52 Figure 1.7: Map of Greater Kuala Lumpur or Klang Valley Graph 2.9: Cost breakdown for B40 house Figure 2.1: Population growth in Greater Kuala Lumpur Graph 2.10: Housing prices vs construction cost in Greater from 2020 to 2030 Kuala Lumpur Figure 3.1: Conceptual housing area layout Graph 2.11: Construction cost per square metre in Kuala Figure 3.2: Quality of life indicators Lumpur from 2005 to 2015 Graph 2.12: Average house prices in Kuala Lumpur from 1999 to 2016 5 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Figure 3.3: Map of Greater Kuala Lumpur / Klang Valley Pages Figure 3.31: Elevation of a proposed affordable housing Pages Figure 3.4: Conceptual land demarcation of Greater Kuala 83 block 112 Lumpur 84 113 Figure 3.5: Land use of Greater Kuala Lumpur Figure 3.32: Layout plan of a proposed affordable 114 Figure 3.6: Major urban centres of Greater Kuala Lumpur 85 housing project 115 Figure 3.7: Rail transit network of Greater Kuala Lumpur 86 116 Figure 3.8: Public rail transit map of Greater Kuala Lumpur and 87 Figure 3.33: Proposed typical layout of affordable 117 its vicinity 88 housing units 118 Figure 3.9: Highway networks of Greater Kuala Lumpur and its 89 119 vicinity Figure 3.34: Layout plan of a proposed affordable Figure 3.10: Conceptual layout planning of future township 90 housing project 91 Figure 3.35: Layout plan of a proposed affordable Figure 3.11: Major activities in future township 92 housing project 93 Figure 3.36: Proposed typical layout of an affordable Figure 3.12: Green lungs in future township 94 housing unit 95 Figure 3.37: Proposed typical layout of an affordable Figure 3.13: Connectivity in future township 96 housing unit 97 Figure 3.38: Illustration view of a proposed affordable Figure 3.14: Detailed layout planning of future township 98 housing project 99 Figure 3.15: Major components of future township 100 101 Figure 3.16: Location of green parks /pockets in future township 102 104 Figure 3.17: Connectivity in future township 105 Figure 3.18: Aerial view of the future township illustration 106 Figure 3.19: Aerial view of the future township illustration 107 Figure 3.20: Aerial view of the future township illustration 108 Figure 3.21: Aerial view of the future township illustration 109 Figure 3.22: Aerial view of the future township illustration 110 Figure 3.23: Layout plan of a proposed affordable housing project 111 6 Figure 3.24: Aerial view of a proposed affordable housing project Figure 3.25: Proposed typical layout of an affordable housing unit Figure 3.26: Layout plan of a proposed affordable housing project Figure 3.27: Proposed typical layout of an affordable housing unit Figure 3.28: Aerial view of a proposed affordable housing project Figure 3.29: Proposed typical layout of an affordable housing unit Figure 3.30: Aerial view of a proposed affordable housing project AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

1.0 ABSTRACT Providing affordable housing for the masses, plays a major role in the well-being of the population, contributing to the physical and mental health, education, employment, security and also the country’s political certainties or uncertainties. Some researched materials on the matter have been made and reported that 80 percent of the population now live in the urban areas that requires affordable housing. In Malaysia, the categories and tier percentages of the population have been divided into three groups; they are the T20 (top), M40 (middle) and B40 (bottom) groups. Research on the affordability of housing has been carried out by many government and non-government agencies as it is one of the key measurements of a country's social-economic stability. New approaches, be it immediate, temporary and permanent need to be formulated to address the short to long term housing needs, especially in urban areas. The issue of affordable housing is now more of national concern, particularly in urban centres in areas such as Kuala Lumpur, Selangor, Johor and Penang. Detailed study and planning on the living conditions with the objective to achieve a level of flexibility are needed to allow for the different levels of people with income disparities to be able to coexist together and peacefully. The kind of facilities and amenities proposed are also significant as to avoid the growth of potential social problems. Shared amenities can help the population to interact and be amongst friends regardless of creed, and race. The primary challenge is to provide adequate, livable and sustainable affordable housing to suit all levels of people living in urban areas that can survive the test of time. Affordable housing and its availability to own one unit per family will be the primary concern for the present and future generations in Malaysia until we reach a point where ample housing units can be built easily and readily available to cater the various income categories. However, not every household or persons can afford or do not want to be burdened with the permanency of buying a property. Other categories shall include affordable rental housing and social rented housing. 7 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

2.0 INTRODUCTION The current situation of affordable housing market in the urban areas of Malaya achieved her independence from the British in 1957 and later with Greater Kuala Lumpur or Klang Valley, which is also the fastest growing urban the inclusion of Singapore, Sabah and Sarawak in 1963, it became Malaysia. conurbation in Malaysia is selected as a case study for this paper. It is also an However, Singapore left the federation in 1965 to form its own city-state attempt to find a solution to address the chronic shortage of affordable republic. Malaya had then been colonised in stages by the British for housing for the masses that are livable and conducive to propagate a civil, approximately 166 years, the Dutch ruled for 183 years since 1641 and the educated and matured society. The United Nations (UN) definition of Portuguese ruled for 130 years from 1511. Prior to the independence of affordable housing is defined as three times the annual household salary, Malaya from the British, there was never been an independent state called also known as the ‘median multiple’ formula. (Khazanah Research Institute, Malaya or Malaysia. It was commonly known as Persekutuan Tanah Melayu 2015). The median monthly household incomes are RM 3,000.00 for B40, RM (Federation of Malaya) consisted of the Federated and Unfederated Malay 6,275.00 for M40 and RM 13,148.00 for T20. (Department of Statistics Malaysia, States and was once part of the British colony, before becoming an 2016). It is hoped that the median monthly household incomes will rise yearly independent state. to the point that it will be at an acceptable level to live comfortably and In 1957, the population of Malaya was only 6.3 million, with 49.8 percent were grow into a highly matured society that will be peaceful, free, moderate and Malays, 37.2 percent Chinese, 11.3 percent Indian and 1.8 percent made of democratic. the other races (Chander, 1975). 60 years later, Malaysia’s population rose to 31 million, comprising 68.6 percent Malays and Bumiputeras, 23.4 percent Chinese, 7.0 percent Indians and 1.0 percent of the other races. (Department of Statistics, Malaysia, 2016). The population has increased by approximately 25 million people in 60 years. Around 75 percent of the population now lived in the major urban areas, concentrating in Kuala Lumpur, Penang, Selangor and Johor (United Nations, World Urbanisation Prospects, 2016). It is anticipated that in years to come the urban population will constitute about 80 percent of the population. Affordable housing is becoming one of the most important criteria in constituting an urban fabric that will propagate growth and other basic human necessities. The others would be jobs, security and a peaceful environment. Furthermore, it is also estimated that the future breakdown of the population will also change from the existing demographic with 72.1 percent Malays and other Bumiputera groups, 20 percent Chinese, 6.4 percent Indian and 1.5 percent of the other races by the year 2040 (Department of Statistics, Malaysia, 2016). 8 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.0 BACKGROUND STUDIES AND FINDINGS The current situation of affordable housing market in the urban areas of 3.1 POPULATION OF MALAYSIA AND GREATER KUALA LUMPUR (KLANG VALLEY) Greater Kuala Lumpur or Klang Valley, which is also the fastest growing urban To date, the population of Greater Kuala Lumpur or Klang Valley stand at conurbation in Malaysia is selected as a case study for this paper. It is also an 7,750,300 people and slated to expand to approximately 10,000,000 people attempt to find a solution to address the chronic shortage of affordable by the year 2020. Taking into account of today’s population at 7,750,300 housing for the masses that are livable and conducive to propagate a civil, people, based on the figures supplied by the Department of Statistics educated and matured society. The United Nations (UN) definition of Malaysia (2010), there are about 1,830,000 households in Selangor, Kuala affordable housing is defined as three times the annual household salary, Lumpur and Putrajaya. To cater for 10,000,000 population by the year 2020, it also known as the ‘median multiple’ formula. (Khazanah Research Institute, is anticipated that the number of people will have to increase up to 2015). The median monthly household incomes are RM 3,000.00 for B40, RM 2,500,000 with at least 2,000,000 people that will need to live in affordable 6,275.00 for M40 and RM 13,148.00 for T20. (Department of Statistics Malaysia, houses in the next three years. However, based on our own projection the 2016). It is hoped that the median monthly household incomes will rise yearly population increase of Greater Kuala Lumpur to 10,000,000 people and the to the point that it will be at an acceptable level to live comfortably and expected population increased seem to be rather ambitious. We projected grow into a highly matured society that will be peaceful, free, moderate and that the population would only increase to approximately 8,700,000 people democratic. by the year 2020 and the approximate addition of only 949,700 people by the year 2017. To achieve the projected 10,000,000 population in 2020, the Greater Kuala Lumpur has to grow about 563,000 people per year, which is around 7.25 percent growth per year. However, based on a more realistic average annual population growth projection of the Greater Kuala Lumpur, which is about 2.6 percent each year, it is anticipated that by the year 2020, we can only achieve 8,720,900 people living in the Greater Kuala Lumpur area. To obtain the expected 10,000,000 population of Greater Kuala Lumpur, we also anticipate that it can only be achieved by the year 2028. By the year 2050, we anticipate the population of Greater Kuala Lumpur will be at 11,000,000 people. Whilst by the year 2100, we anticipate the population will be approximately 12,000,000 people living in the Greater Kuala Lumpur area. The total expected population of Malaysia will be between 40,000,000 to 60,000,000 people at its maximum, depending on the growth model used to project the country’s population growth. 9 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Listed in the below table is the data of total household income, population and living quarters (houses) in the Greater Kuala Lumpur region and Malaysia in the year 2016: (Department of Statistics Malaysia, 2017) DATA SELANGOR KUALA LUMPUR PUTRAJAYA NATIONAL (MALAYSIA) Median Household Income (RM) 7,225 9,073 8,275 5,228 Size of households 3.9 3.7 3.5 4.06 Total Households 1,830,000 6,396,174 Total Living Quarters (Houses) 2,066,396 7,380,865 Total Population   32,049,700 7,750,300 Table 1.1: Total household income, population and living quarters (houses) in the Greater Kuala Lumpur and Malaysia in 2016 Graph 1.1: Malaysian population from 1957 to 2100, based on data projection by Department of Statistics, Malaysia and UN Department of Economic and Social Affairs YEARS 1957 1970 1980 1991 2000 2010 2016 2017 2020 2030 2040 2050 2057 2060 2070 2080 2090 2100 Malaysia 7,393, 10,860, 13,772, 18,709, 23,420, 28,119, 30,572, 32,049, 33,782, 38,062, 38,852, 41,100, 41,690, 41,995, 42,418, 42,059, 41,437, 40,778, 000 000 000 000 000 000 442 700 400 200 000 000 000 000 000 000 000 000                 Table 1.2: Malaysian population from 1957 to 2100 10 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

62,000,000 (-0.5 % growth rate) 40,778,000 (-0.2% growth rate) 26,000,000 (-1.15% growth rate) Graph 1.2: Graph of the Malaysian population from years 1950 to 2100, with the low variant stands at 26 million, 41 million (medium variant) and up to 62 million (high variant) in the year 2100 (UN Department of Economic and Social 11 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Figure 1.1: Malaysian population from 1957 to 2100 12 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Population estimation of Greater Kuala Lumpur / Klang Valley from years 1957 to 2100 Graph 1.3: Population of Greater Kuala Lumpur from 1957 to 2100 YEARS 1957 1970 1980 1991 2000 2010 2017 2020 2030 2040 2050 2057 2060 2070 2080 2090 2100 S’gor 1,012,9 1,625,6 1,426,2 1,642,7 2,009,8 5,502,1 6,380,8 6,715,6 7,620,4 8,406,8 8,465,6 8,454,7 8,516,4 8,559,0 8,593,2 8,619,0 8,636,2 29 20 50 71 93 00 00 00 00 00 48 32 42 24 60 40 78 KL            0 4 5 1 ,  9 3 7 ,  1,145,3 1,297,5 1,627,1 1,791,3 1,910,7 2,034,7 2,122,1 2,136,9 2,134,5 2,149,7 2,160,5 2,169,1 2,175,6 2,180,0 P’jaya 810 817 42 26 72 00 00 00 00 55 28 77 26 68 76 27 0          TOTAL 0 00 0 73,400 86,900 94,600 1 0 5 ,  1 1 2 ,  1 1 2 ,  1 1 2 ,  1 1 2 ,  1 1 2 ,  1 1 2 ,  1 1 2 ,  1 1 2 ,  1,012,9 661 774 774 774 774 29 2,077,4 2,364,0 2,788,1       900 100 436 563   30 67 13    10,778, 10,832, 10,875, 10,907, 10,929,      880 324 202 490 079 3,307,4 7,202,6 8,259,0 8,720,9 9,761,0 10,641, 10,715, 10,701, 19 72 00 00 00 000 039 823     Table 1.3: Population of Greater Kuala Lumpur from 1957 to 2100 13 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Assumption growth rate of the national (Malaysian) population and the Greater Kuala Lumpur population from years 1957 to 2100 Graph 1.4: Population growth assumption of Greater KL and Malaysia from 1957 to 2100 YEARS 1957 1970 1980 1991 2000 2010 2017 2020 2030 2040 2050 2057 2060 2070 2080 2090 2100 10,860, 42,059, 41,437, 40,778, Malaysia 7,393,0 000 13,772, 18,709, 23,420, 28,119, 32,049, 33,782, 38,062, 41,503, 41,100, 41,690, 41,995, 42,418, 000 000 000   000 000 000 000 700 400 200 100 000 000 000 000       00 2,077,4 10,875, 10,907, 10,929, 30 202 490 079                 G r e a t e r  1,012,9 2,364,0 2,788,1 3,307,4 7,202,6 8,259,0 8,720,9 9,761,0 10,641, 10,715, 10,701, 10,778, 10,832, K u a l a  29 67 13 19 72 00 00 00 000 039 823 880 324       Lumpur   Table 1.4: Population growth assumption of Greater KL and Malaysia from 1957 to 2100 14 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.2 AGEING POPULATION OF MALAYSIA According to the United Nations (UN), an ageing population can be defined as a demographic process in which the proportion of the country’s population of about 15 percent is comprised older persons aged from 60 years and above. The increase in life expectancy of the population changes in the population demography of a city and the country. Malay Mail Online (2016) reported that a male child born in 2016 can expect to live up to 72.6 years, compared to 71.9 years in 2010, while a female child, up to 77.2 years or up 0.6 years compared to 76.6 years in 2010. It is anticipated that by the year 2050, people aged 60 years and above will make up approximately 24 percent of the total population, as per the table below: Graph 1.5: Malaysian age groups from 1957 to 2100 YEARS 1957 1970 1980 1990 2000 2016 2017 2020 2030 2040 2050 2057 2060 2070 2080 2090 2100 45.0 39.2 37.0 33.6 24.1 23.7 23 22 19 17 16.4 16.2 15.5 15 14.8 14.7 0‐14 years (%) 44.2           50.0 55.6 57.4 60.1 67.6 66.5 66 65 63 59 56.6 55.5 54.2 53 51.3 50.1 1 5 ‐ 6 0   y e a r s  50.8   (%) 5.0 5.0 5.2.0 5.6 6.3 8.3 9.8 11 15 18 24 27 28.3 30.3 32 33.9 35.2 6 0   y e a r s  above (%) Table 1.5: Malaysian age groups from 1957 to 2100 15 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

There are presently about 2,100,000 registered immigrants in Malaysia, of which over one million are likely to be unregistered. To boost the economy, the World Bank has suggested that a 10 percent net increase in low-skilled foreign labour might boost the country’s real GDP growth by up to 1.1 percent. Therefore, in future, we may still need immigrants to be part of the workforce to carry out works that are needed to be carried out low, medium or even high skill class workers to generate and expand the economy. Graph 1.6: Population growth and immigration rate in Malaysia from 1957 to 2100 YEARS 19 1 9  1 9  1 9  1 9  1 9  1 9  1 9  1 9  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 0  2 1  57 60 65 70 75 80 85 90 95 00 05 10 17 20 25 30 35 40 45 50 55 57 60 65 70 75 80 85 90 95 00 Growth  3.0 3.2 3.1 2.5 2.4 2.4 2.8 2.9 2.6 2.4 1.9 1.7 1.3 1.4 1.2 1.1 0.9 0.7 0.6 0.5 0.4 0.3 0.2 0.2 0.1 0.0 ‐ ‐ ‐ ‐ ‐ rate (%) 0.1 0.2 0.2 0.2 0.2 Expected  0.0 ‐ migratio n  0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.4 0.8 0.7 0.9 1.0 1.2 1.4 1.5 1.6 1.7 1.8 1.9 1.9 2.0 2.1 2.2 2.3 2.3 2.3 2.3 (%) Table 1.6: Population growth and immigration rate in Malaysia from 1957 to 2100 16 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.3 DEFINITIONS OF AFFORDABLE HOUSINGS Conversely, abnormally low values signal insecurity of tenure and can lead to The indicators and definitions of affordable housing vary across the world. a reduced willingness of the population to invest in housing, and which will The most common measure to indicate affordable housing is the price-to- provide as a result a lower than the necessary quality of housing. income ratio, more commonly known as the ‘median-multiple’. It was Subsequent empirical research by the UNCHS and the World Bank utilising developed in 1988 by the United Nations Centre for Human Settlement international data and adapted in the Annual Demographia International (UNCHS) and the World Bank under the Housing Indicators Program. Then, it Housing Surveys found that the ‘global norm’ for affordability was three times, was later used in the UN-HABITAT Housing Indicators Programme, which meaning that if the median price for the whole of a housing market was focused on monitoring the provision and quality of dwellings. three times the median gross annual household income, this signals a well- Khazanah Research Institute (2015) defines the median multiple is based on functioning housing market. the assumption that as housing prices become higher and above incomes of Most of all, it is imperative that the adequate and proper housing is the vital many people, a smaller proportion of households can afford to buy houses, measure to combat future social problems. It is worthwhile, to invest in with other factors holding constant. More importantly, deviations of this ensuring proper housing are constantly provided. However, we must also be indicator from global norms can signal serious distortions in the housing aware that each of these affordable housing units has a lifespan of market. When the housing value is excessively high, these distortions may approximately 30 years. After or before every 30 years, these units must be indicate that the housing sector is restricted in its ability to supply sufficient either refurbished or demolished to make a way for an updated living unit for housing to meet effective demand. In these instances, it has been found that a more conducive living to match the changing lifestyles. housing quality and space are depressed below levels typically found in countries with well-functioning and responsive markets. The affordability rating formulated by Demographia (2015) is defined as such: RATING MEDIAN MULTIPLE Severely unaffordable 5.1 and over Seriously unaffordable 4.1 ‐ 5.0 Moderately unaffordable 4.1 ‐ 5.0 Affordable 3.0 and under Table 1.7: Housing price affordability rating 17 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Currently, there are various definitions of affordable housing in Malaysia Hence, based on the below table, it can be summarised that the from the depending on the respective agencies, with the prices ranging from RM perspective of the Government of Malaysia, houses with the price tag of RM 42,000.00 up to RM 400,000.00. It can be inferred that from the perspective of 300,000 and below are considered as affordable housing. However, for some the Government of Malaysia, houses with the price tag of RM 300,000.00 private developers, RM 500,000 is considered ‘affordable’, as long as it is and below are considered as affordable housing. However, for some private listed as RM 1,000,000 and below. (Lim, 2016). developers, RM 500,000.00 is considered ‘affordable’, as long as it is listed as RM 1,000,000.00 and below. (Lim, 2016). Presently, most of these low cost and affordable units are of high density low or high rise apartments of about 650 to 950 square feet or units below 1,000 square feet. However, these units are three bedrooms with two bathrooms. Currently there are various definitions of affordable housing in Malaysia depending on the respective agencies. These definitions are listed below:: AGENCIES PRICE RANGE FEATURES INCOME REQUIREMENTS Ministry of Federal Territories RM 63,000 ‐ RM 300.000 3 rooms, 2 rooms, 1 room, studio type <RM 10,000 Department of National Housing, Ministry  <RM 300.000 Divided into low cost, low medium cost,  <RM 5,000 of Housing and Local Government medium cost PR1MA Corporation RM 100,000 – RM 400,000   RM 2,500 – RM 15,000 N a t i o n a l   H o u s i n g   C o m p a n y     B e r h a d  RM 100,000 – RM 300,000     (SPNB) Selangor Property and Housing Board  RM 42,000‐ Type A, B, C, D <RM 3,000‐ (LPHS) RM 250,000 RM 10,000 Table 1.8: Pricing ranges of various affordable housings 18 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.4 OVERVIEW OF AFFORDABLE HOUSINGS IN MALAYSIA They were intially built without running water, electricity and sewerage Since the independence of Malaya in 1957, the provision of low-cost housing system. They are often built on a make shift single storey house to has become a priority of the government in its ‘Five Year National Plans’. To accommodate a family or families with their children. These types of houses date, there are eleven national plans in the period of 60 years. The plans are were prevalent in the 1960’s and were successfully reduced to almost zero in normally divided into a five-year plans. Government agencies were also recent years. The land they had squattered on were at times used to build directly responsible for providing housing for the poor in urban areas through affordable high and low-rise affordable housing. There are now almost zero the establishment of the respective state economic development squatter colonies within the Greater Kuala Lumpur or Klang Valley region, corporations and various urban development agencies, such as the Urban which is commendable as compared to many developing countries around Development Authority (UDA) and local authorities. (Shuid, 2016). the world. The reasons behind the building of squatters in the past were During and after the independence of Malaya, Kuala Lumpur and many mainly due to the following: urban areas were mainly consists of shanty homes or commonly known as 1. Lack of available affordable housings. squatters. The houses were simply built using timber with corrugated metal 2. Difficult structure to owning affordable housings. roofing and often in large colonies consisting of several hundred houses. 3. The lack of infrastructure to complement affordable housings. 4. Lack of land ownership. 5. Lack of long term planning in providing affordable houses Figure 1.2: View of Kampung Baru in Kuala Lumpur circa 1960’s Figure 1.3: The former Pekeliling flats in Jalan Tun Razak, K. Lumpur (Dept of (v12gether.blogspot.my) Information) 19 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

To ensure that the private sector plays their part in constructing low-cost After the complete abolishment of the squatter colonies throughout many housing, the government through various state, local authorities had urban areas, the problem of proper well planned affordable housing has imposed 30 percent or in some instances up to 50 percent of the total become the next challenge. From the last two economic downturns, which provision for units built quota for the building of low-cost and affordable was in 1997 and 2008, there seems to be an acute shortage of affordable housing in every residential development. Ensuring that the targeted group housing. Price such of houses, (landed or strata) has risen tremendously to secures these houses, the government has also imposed an open registration the point that many could not afford to buy these houses. This is also to system. To be fair to all, a balloting system is often carried out to ensure that correctly reflect Malaysia as a developed nation status, which the there were no favouritism when selling these affordable housing units. There is government has aimed to obtain the status by the year 2020. The aim is to no specific quota or registered purchaser required for other housing promote 80 percent or more home ownership in Malaysia in many years to categories. Now in some areas, the number of affordable units built must come. equal to the number of high-cost houses, i.e. 50 percent affordable housing with 50 percent of free pricing houses. This approach has been carried out by allowing these units to be built in the high rise apartment units. In some instances, the high priced units partly subsidised for the construction of the low-end or affordable units. Figure 1.4 & 1.5: View of squatters in Kg Kerinchi, circa 1990’s, (left) now being replaced by Bangsar South development (right) in Kuala Lumpur(lembahpantai.blogspot.my/ victorsia.iagent.my) 20 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

BUKIT RM 13.17 PSF (2012) BERUNTUNG RM 31.90 PSF (2012) KAPAR RM 126.81 PSF (2012) PUCHONG RM 50.00 PSF (2012) KOTA KEMUNING KAJANG RM 37.93 PSF (2012) BANGI RM 29.94 PSF (2012) DENGKIL RM 48.10 PSF (2012) RM 40.00 PSF (2012) LABU Figure 1.6: Land Price Per Square Foot (PSF) in Selected Areas of Greater Kuala Lumpur / Klang Valley 21 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Prices of commercial and residential lands in selected areas in Kuala Lumpur, Selangor and N.Sembilan. The residential land prices can be further differed in various types of land titles, which are the leasehold, freehold and Malay Reserve land. Graph 1.7: Average land price in Kuala Lumpur from 1957 to 2017 22 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Graph 1.8: Average land price in Selangor and Negeri Sembilan from 1957 to 2017 23 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.5 AFFORDABLE HOUSING PRICES IN MALAYSIA Before the Eight Malaysian Plan (2001 to 2005), from 1957 up to 1998, and until now, only low-cost housings have been provided by the various federal and state government agencies. Beginning of 2001, provision of affordable housings has emerged to the increasing demands from the middle and low- income groups, comprises the Middle 40 (M40) and Bottom 40 (B40) The changes in housing prices can be seen in the following chart: Graph 1.9: Pricing ranges of low cost and affordable housings YEARS BEFORE 1970 1970 ‐ 1980 1981 – 1997 1998 – 2001 2001 – 2015 2016 Low cost housing price  5,000.00 – 12,000.00 (RM) 12,000.00 – 18,000.00 25,000.00 25,000.00 – 42,000.00 30,000.00 – 42,000.00 30,000.00 – 42,000.00 Affordable hous ing    price (RM)     1 0 0 , 0 0 0 . 0 0   –  4 0 0 , 0 0 0 . 0 0   –  Table 1.9: Pricing ranges of low cost and affordable housings 400,000.00 752,000.00 24 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.6 STATE OF INCOME IN MALAYSIA In 2014, the median household salary rose 12.4 percent, but prices of houses in Malaysia have also had risen by 11.2 percent. The macro data have been further analysed into the respective states, and the multiple median rates have been obtained in the following table, based on the data collected in 2014 (Khazanah Research Institute, 2015). However, household income of Malaysians, particularly in the Kuala Lumpur region has increased from RM 645.00 in 1976 to RM 7,620.00 in the year 2014. AREAS M O N T H L Y   M E D I A N  A N N U A L   M E D I A N  M A R K E T   M E D I A N  MEDIAN ALL‐HOUSE  M E D I A N   M U L T I P L E  AFFORDABILITY LEVEL National (Malaysia) INCOME AFFORDABILITY Kuala Lumpur 4,585 INCOME PRICE PRICE 4.4 4.1 to 5.0 Selangor Seriously 7,620 55,020 165,060 242,000 5.4 unaffordable 5.1 & Over 6,214 91,440 274,320 490,000 4.0 Severely unaffordable 74,568 223,704 300,000 3.1 to 4.0 Moderately unaffordable Table 1.10: Income, housing price and affordability level Median income is the amount that divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount. Mean income (average) is the amount obtained by dividing the total aggregate income of a group by the number of units in that group. 25 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

However, household income of Malaysians, particularly in the Greater Kuala Lumpur region has increased from years 1957 until 2014: Graph 1.10: Median monthly household income of Malaysian and Greater Kuala Lumpur population YEARS 1957 1967 1970 1974 1976 1979 1984 1987 1989 1992 1995 1997 1999 2002 2004 2007 2009 2012 2014 N t n l  150.0 145.0 166.0 227.0 308.0 429.0 719.0 738.0 816.0 1,077. 1,377. 1,724. 1,704. 2,049. 2,211. 2,552. ,830.0 3,626. 4,585. ( M ’ s i a )  0 0 0 0 0 0 0 0 0 00 00 00 00 00 00 00 0 00 00 (RM) S ’ g o r        363.0 441.0 647.0 1,010. 1,049. 1,145. 1,572. 2,255. 2,850. 2,750. 3,144. 3,588. 4,046. 4,273. 5,353. 6,214. (RM) 0 0 0 00 00 00 00 00 00 00 00 00 00 00 00 00 KL (RM)     4,334. 5,847. 7,620.     645.0   1,217. 1,180. 1,294. 1,753. 2,321. 2,850. 2,828. 3,364. 3,336. 3,697. 00 00 00 P ’ j a y a      0 00 00 00 00 00 00 00 00 00 00 5,373. 6,486. 7,512. (RM)  00 00 00                           4,288. 00 Table 1.11: Median monthly household income of Malaysian and Greater Kuala Lumpur population 26 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

3.7 GROUP INCOME EARNERS VS HOUSING PRICES The percentage distribution of different income groups in Malaysian urban areas, with M40, forms the largest group (43.19 percent), followed by B40 (32.79 percent) and T20 (24.02 percent). Further percentage distribution of group income earners in urban Malaysia is presented in the chart below. The large M40 income group indicates the large group of middle income earners in many urban areas of Malaysia, that has become the major boon of Malaysian economies since the 1980’s. Graph 1.11: Percentage distribution of group income earners in urban Malaysia 27 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Graph 1.12: Population percentage of income groups in urban Malaysia YEARS 1974 1976 1979 1984 1987 1992 1995 1997 1999 2002 2004 2007 2009 2012 2014 2020 T20 (%) 59.5 56.2 54.1 52.3 50.6 50.1 49.8 50.2 48.7 49.6 49.8 48.6 48.2 47.5 45.9 41.4 M40 (%) 59.1 31.4 33.3 34.4 35.2 35.3 35.7 35.6 36.5 35.7 35.6 36.2 36.5 36.9 36.9 45.0 B40 (%) 11.4 12.1 12.7 13.3 14.2 14.6 14.5 14.2 14.8 14.7 14.6 15.2 15.3 15.6 17.1 13.6 Table 1.12: Population percentage of income groups in urban Malaysia 28 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Graph 1.13: Median yearly household income vs housing prices in Kuala Lumpur from 1999 to 2014 29 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Graph 1.14: Median yearly household income vs housing prices in Selangor from 1999 to 2014 30 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Commodity crisis 1987 15 years 10 years 13 years 11 years 11 years to 2020 9/11 crisis East Asian financial Sub-prime crisis crisis 1987 Graph 1.15: Malaysian GDP growth from 1960 to 2020 31 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Figure 1.7: Map of Greater Kuala Lumpur or Klang Valley 32 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

4.0 ANALYSIS AND DISCUSSIONS 4.1 OVERVIEW OF AFFORDABLE HOUSING IN GREATER KUALA LUMPUR The current approach in building housing units has created an imbalance for those who would like to own an affordable landed house or an apartment unit. A typical terrace house around 50 km radius from Kuala Lumpur (Metro / Greater Kuala Lumpur) presently cost about RM 600,000.00 to over RM 1,000,000.00 which is actually beyond the current affordability level. As compared to our neighbour, Singapore which has a land of approximately 719.1 square kilometres with a population of more than 5,000,000 people. They have successfully built affordable units for the population. It is anticipated the population of Singapore will grow to approximately 6,000,000 people in the future and plans are said to have been made to cater for the various income groups. The Greater Kuala Lumpur and the surroundings area are approximately 8,396 square kilometres and should be able to house more people, but at a price range that will be within reach of many people seeking affordable housings. At present, there seems to be a disconnect which has left our urban city of Greater Kuala Lumpur with a shortage in the ownership of affordable housings ownership by the measures of people living in the area. The population of the Greater Kuala Lumpur is currently 7,500,000 people and it is anticipated to grow to 12,000,000 in the next 50 years. Based on the UN median multiple housing measures, and by using the household income survey data produced by the Department of Statistics, the affordable housing price should be formulated as per below: AREAS MEDIAN HOUSEHOLD INCOME (RM) UN MEDIAN MULTIPLE PRICE INDICATOR (RM)  National (Malaysia) 5,228 188,208 Selangor 7,225 260,100 Kuala Lumpur 9,073 326,628 Putrajaya 8,275 297,900 Table 2.1: Median household income of Malaysia and Greater Kuala Lumpur 33 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

4.2 FUTURE INCOME GROUP EARNERS  The current income groups are predicted to be shifted in the near future. As the household income increased, it may be possible that the new income groups are Top 20 percent (T30), Middle 60 percent (M60) and Bottom 10 percent (B10) in the years to come. Figure 4 shows the projected income groups from years 2020 to 2100.. As shown below is the projected income groups from years 2020 to 2100: Graph 2.1: Percentage of income groups in urban Malaysia from 2020 to 2100 YEARS 2020 2030 2040 2050 2060 2070 2080 2090 2100 T30 (%) 59.5 56.2 54.1 52.3 50.6 50.1 49.8 50.2 48.7 M60 (%) 59.1 31.4 33.3 34.4 35.2 35.3 35.7 35.6 36.5 B10 (%) 11.4 12.1 12.7 13.3 14.2 14.6 14.5 14.2 14.8 Table 2.2: Percentage of income groups in urban Malaysia from 2020 to 2100 34 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

A further breakdown of the different income earners groups and the market property prices can be analysed into the respective groups of T20, M40 and B40. For T20 earners group, they can be defined as the country's top 20 percent income earners. Their median monthly income is RM11, 610.00 or a mean monthly income of RM14, 305.00 (Malaysiakini, 2015). Yearly income is RM 171,660.00 and above. Assumptions of the percentage of different income group in Malaysian urban population respectively: T20 MONTHLY INCOME (RM) ANNUAL SALARY RANGE (RM) PERCENTAGE (%) E S T I M A T E D   M O N T H L Y  RELATIVE HOUSING PRICES IN  333,333 ‐ 416,666 INSTALLMENTS (RM) THE MARKET (RM) 250,000 ‐ 333,333 166,666 ‐ 250,000 4,000,000 and above 1.0 >53,129.51 12,000,000 and above 83,333 ‐ 166,666 75,000 – 83,333 3,000,000 – 4,000,000 1.0 39,847.13 ‐ 53,129.51 9,000,000– 12,000,000 66,666 – 75,000 58,333 – 66,666 2,000,000 – 3,000,000 1.0 26,564.75 ‐ 39,847.13 6,000,000– 9,000,000 50,000 – 58,333 41,666 ‐ 50,000 1,000,000 – 2,000,000 1.0 13,282.38 ‐ 26,564.75 3,000,000– 6,000,000 33,333 – 41,666 25,000 ‐ 33,333 900,000 – 1,000,000 2.5 11,954.14 ‐ 13,282.38 2,700,000– 3,000,000 16,666 ‐ 25,000 8,333 – 16,666 800,000 – 900,000 2.5 10,625.90 ‐ 11,954.14 2,400,000 – 2,700,000 TOTAL 700,000 – 800,000 2.5 9,297.66 ‐ 10,625.90 2,100,000– 2,400,000 600,000 – 700,000 2.5 7,969.43 ‐ 9,297.66 1,800,000 – 2,100,000 500,000 – 600,000 2.5 6,641.19 ‐ 7,969.43 1,500,000– 1,800,000 400,000 – 500,000 2.5 5,312.95  6,641.19 1,200,000– 1,500,000 300,000 – 400,000 2.5 3,984.71 ‐ 5,312.95 900,000 – 1,200,000 200,000 – 300,000 2.5 2,656.48 ‐ 3,984.71 600,000 – 900,000 100,000 – 200,000 76.0 1,328.24 ‐ 2,656.48 300,000 – 600,000 100.0     Table 2.3: Percentage of T20 income group in Malaysian urban population 35 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

M40 refers to the middle 40 percent income earners between RM 3,860.00 and RM 8,319.00. The M40 group has a median monthly income of RM 5,465.00 or mean income of RM 5,662.00. M40 MONTHLY INCOME (RM) ANNUAL SALARY RANGE (RM) PERCENTAGE (%) E S T I M A T E D   M O N T H L Y  RELATIVE HOUSING PRICES IN  7,500 – 8,333 90,000 – 100,000 8.0 INSTALLMENTS (RM) THE MARKET (RM) 6,666 – 7,500 80,000 – 90,000 10.0 5,833 – 6,666 70,‐000 – 80,000 13.0 1,195.41 – 1,328.24 270,000 – 300,000 5,000 – 5,833 60,000 – 70,000 17.0 4,166 – 5,000 50,000 – 60,000 22.0 1,062.59 ‐ 1,195.41 240,000 – 270,000 3,333 – 4,166 40,000 – 50,000 30.0 TOTAL 100.0 929.77 ‐ 1,062.59 210,000 – 240,000 796.94 ‐ 929.77 180,000 – 210,000 664.12 ‐ 796.94 150,000 – 180,000 531.30 ‐ 664.12 120,000 – 150,000    Table 2.4: Percentage of M40 income group in Malaysian urban population While the B40 income earners refer to households with income up to RM 3,855.00. Their median monthly income is RM 2,629.00 while the mean income of RM 2,537.00. B40 MONTHLY INCOME (RM) ANNUAL SALARY RANGE (RM) PERCENTAGE (%) E S T I M A T E D   M O N T H L Y  RELATIVE HOUSING PRICES IN  2,500 – 3,333 30,000 – 40,000 40.0 INSTALLMENTS (RM) THE MARKET (RM) 1,666 – 2,500 20,000 – 30,000 40.0 833 – 1,666 10,000 – 20,000 10.0 398.47 ‐ 531.30 90,000 – 120,000 833 and below 10,000 and below 10.0 TOTAL 100.0 265.65 ‐ 398.47 60,000 – 90,000 132.82 ‐ 265.65 30,000 – 60,000 <132.82 30,000 and below    Table 2.5: Percentage of B40 income group in Malaysian urban population 36 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Affordable housing schemes in Greater Kuala Lumpur / Klang Valley HOUSING SCHEMES PR1MA R U M A H  SPNB ASPIRASI RUMAWIP PPA1M PPR RU MAH  T R AN SI T  SELANGORKU 1MALAYSIA Providers PR1MA Corporation  Selangor Property  National Housing  Ministry of Federal  P P A 1 M   U n i t ,    National Housing  National Housing  Malaysia and Housing Board  Company  Berhad  Territories P r i m e   M i n i s t e r ’ s  D e p a r t m e n t ,  D e p a r t m e n t ,  (LPHS) (SPNB) Department Ministry of Urban  Ministry of Urban    Wellbeing, Housing  Wellbeing, Housing  S e l a n g o r   S t a t e  a n d   L o c a l  a n d   L o c a l  D e v e l o p m e n t  Government Government Corporation (PKNS)   Price Range RM 100,000‐       RM 42,000‐     RM 145,000‐   RM 193,000‐       RM 90,000 ‐        RM 30,000‐       ( M o n t h l y   r e n t   R M  RM 400,000 RM 250,000 RM 752,000 RM 300,000 RM 300,000 RM 35,000 250) Built‐up Area 46 sq. m.          65 sq. m.          51 sq. m.         60 sq. m.          9 2   s q .   m .    65 sq. m.         65 sq. m.           (500 sq. ft.) –     700 sq. ft.) –      (550 sq. ft.)  –      (650 sq. ft.) –      ( 1 , 0 0 0   s q .   f t . )   ‐     (700 sq. ft.) –       (700 sq. ft.) –       111 sq. m       (1,200  111 sq. m.     97 sq. m.       74 sq. m.         1 4 0   s q .   m .     79 sq. m.         79 sq. m.         sq. ft.) (1,200 sq. ft.)  (1,044 sq. ft.)  (800 sq. ft.) (1,500 sq.ft.)  (850 sq. ft.)  (850 sq. ft.) Types of House A p a r t m e n t   ( f o r  Flat Apartment Apartment A p a r t m e n t   ( f o r  Flat Flat S e l a n g o r / K u a l a  Apartment S e l a n g o r / K u a l a  Lumpur) Terrace Lumpur) Terrace Town House Terrace Semi‐D  Bungalow Locations K u a l a   L u m p u r   /   Selangor K u a l a   L u m p u r   /   K u a l a   L u m p u r   /  K u a l a   L u m p u r   /   K u a l a   L u m p u r   /   Kuala Lumpur Selangor   Selangor   Putrajaya  Selangor  Selangor   (All over Malaysia) (All over Malaysia) (Also Labuan) (All over Malaysia) (All over Malaysia) Available Units 80,000  34,000 (estimated) 3,710 70,000 (estimated) 12,000 37,946 632 (estimated)   I n c o m e  RM 2,500‐           <RM 3,000‐        <RM 5,000‐        <RM2, 500‐    <RM 5,000‐        <RM 2,500 –      <RM 3,000 Qualifications RM 10,000 RM 8,000 R M   1 0 , 0 0 0   ( f o r      RM 15,000 RM 10,000 (for civil  RM 3,500 selected projects) servants only) M o n t h l y  RM 440.12‐         RM 184.85‐       RM 638.17‐        RM277.27‐         R M   6 6 0 . 1 7 ‐    RM 132.03‐       ‐  RM 1,100.29 RM 3,308.26 RM 1,320.35 Repayments RM 1,760.46   RM 1,320.35  RM 150.04 ( F o r   3 0   y e a r s   a t  4.2% interest rate  a n d   1 0 %   d o w n  payment) Table 2.6: Affordable housing schemes in Greater Kuala Lumpur 37 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Comparison of geographical areas of Greater Kuala Lumpur / Klang Valley (Malaysia), Singapore and Hong Kong KEY FEATURES GREATER KUALA LUMPUR /  REPUBLIC OF SINGAPORE HONG KONG SPECIAL ADMINISTRATIVE  Maps KLANG VALLEY (MALAYSIA) REGION (CHINA) Region(s) Selangor Singapore Island Hong Kong Kuala Lumpur Major Cities / Towns Putrajaya Bukit Merah Victoria City Kuala Lumpur Jurong West Kowloon Area Klang Hougang Tsuen Wan Current Population Subang Jaya Bedok Yuen Long  Density Petaling Jaya Woodlands Tung Chung Population in year 2020 Shah Alam 719.1 sq.km. (278 sq.mi.) 2,755 sq.km. (1,064 sq.mi.) 8,396 sq.km. (3241.7 sq.mi.) 5,610,000 7,364,883 8,259,000 7,697/sq.km. 2,673/sq.km. 984/sq.km. 6,007,000 7,557,000 8,720,900 Table 2.7: Comparison data of Greater Kuala Lumpur, Singapore and Hong Kong Singapore’s approach in addressing the needs of affordable housing has been studied and is regarded as a good method of providing the affordable housings for its population through their Housing and Development Board (HDB) programme. It had recognised the need to provide affordable housing through long term projections. It is just a comparison, as Greater Kuala Lumpur and Singapore are indeed different. Singapore is a city-state with limited land resources. Greater Kuala Lumpur is 11 times bigger than the size of Singapore. This shows that we have more land to build houses than Singapore. However, the city, state seems to have been able to manage the affordable housing concerns better than most countries, as it has to be efficient in its planning in order to remain as one the best city to live in. 38 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Comparison of affordable housing schemes between Greater Kuala Lumpur (Malaysia), Singapore and Hong Kong COUNTRY MALAYSIA (GREATER KUALA LUMPUR  /  SINGAPORE HONG KONG Provider(s) KLANG VLLEY) Hong Kong Housing Authority Hong Kong Housing Society Price Range Ministry of Federal Territories Housing and Development Board (HDB) Built‐up Area National Housing Company  Berhad HK$ 1,500,000‐ HK$ 10,335,640 Types of House (RM 750,711 – RM 5,172,721) Locations National Housing Department,  Ministry of  37 sq. m. (398 sq. ft.) –                            Available Units 160 sq. m. (1,722 sq. ft.) U r b a n W ell bein g,  Ho usin g   and  Loc al  Flat Government Apartment Across Hong Kong in 177 housing estates PPA1M Unit, Prime Minister’s Department 1,188,000 PR1MA Corporation Malaysia Selangor Property and Housing Board Selangor State Development Corporation RM 30,000 – RM 400,000 S$ 75,000 ‐ S$ 489,000 (RM 223,653 ‐ RM 1,458,222) 46 sq. m. (500 sq. ft.) –                              140  45.3 sq. m. (487 sq. ft.)  ‐                sq. m. (1,500 sq. ft.) 115.3 sq. m. (1,241 sq. ft.) Flat Flat Apartment Apartment Terrace Across Greater Kuala Lumpur / Klang Valley  Across Singapore in 26 housing estates in 10 municipalities 238,288 1,504,000 Income Qualifications <RM 2,500 – RM 10,000 S$ 6,000 – S$ 18,000 HK$ 10,970 – HK$ 62,930 Median Household Income RM 7,115 (RM 17,892 – RM 53,676) (RM 5,490 – RM 31,494) S$ 8,666 (RM 25,842) HK$ 23,500 (RM 11,761) Total Households 1,803,000 3,200,000 2,150,000 Total Population 7,212,572 5,399,000 7,188,000 Table 2.8 : Comparative table of affordable housing schemes in Greater Kuala Lumpur, Singapore and Hong Kong 39 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

4.3 CASE STUDY: PUBLIC HOUSING IN SINGAPORE Public housing in Singapore is managed by the Housing and Development Board (HDB), a statutory body under the Ministry of National Development of Singapore Government. The majority of the residential housing developments in Singapore is publicly governed and developed. These flats are located in housing estates, which are self-contained satellite towns with various basic amenities and facilties. There are varieties of flat types and layouts which cater to various housing budgets. HDB flats were built primarily to provide affordable housing for the poor and their purchase can be financially aided by the Central Provident Fund. Recently, due to changing demands, there were more up-market public housing developments in recent years. Historical Milestones In 1959, in its election campaign, the People's Action Party (PAP) recognised that housing required urgent attention and pledged that it would provide low-cost housing for the poor if it was selected. When it won the elections and formed the newly elected government, it took immediate action to solve the housing shortage. The SIT was changed to the HDB. In February 1960, the Housing and Development Board (HDB) was established to develop public housing and improve the quality of living environment for the masses in Singapore through the Five-Year Building Programme(from 1960 to 1965). The housing that was initially built was mostly meant for rental by the low income group. In 1964, the Home Ownership Scheme was also introduced to help citizens to buy instead of renting their flats. Four years later, the government decided to allow people to use their Central Provident Fund savings as down payment. However, these efforts were not successful enough then in convincing the people living in the squatter settlements to move onto these flats. It was after 25 May 1961, the day of the Bukit Ho Swee fire, that HDB's efficiency and earnestness won the people over. The HDB estimated that from 1959 to 1969, an average of 147,000 housing units—80,000 from the current deficit, 20,000 due to the redevelopment of the Central Area, and 47,000 due to population increase—would need to be constructed; an average of about 14,000 a year. However, the private sector only had the ability to provide 2500 per year, and at price levels out of reach of the low-income. The HDB set out to resolve the deficit. Between 1960 and 1965, the HDB built 54,430 housing units. Due to land constraints, high-rise and high-density flats were chosen. By 1965, HDB was able to overcome the worst of the housing shortage by providing low-cost housing for the lower-income group within the planned period of five years. Several reasons contributed to the success of the HDB. Firstly, the HDB received very strong support from the government, which allocated a large amount of funds to public housing. The HDB was also equipped with legal powers such as the power to resettle squatters. The hard work and dedication of Lim Kim San, the first chairman of the HDB, and other members of the board, also contributed to its success. 40 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

4.4 HOUSING PRICES AND CONSTRUCTION COST IN GREATER KUALA LUMPUR Estimation of cost breakdown of construction and development cost of affordable housing in Greater Kuala Lumpur, as per analysis in the below chart. FURTHER BREAKDOWN OF LAND USE D E V E L O P M E N T  INFRA‐STRUCTURE GREEN SPACES PUBLIC AMENITIES Public park AREAS Mosque School Residential Road Police station Fire station Commercial  Bridge Community hall R e c r e a t i o n a l  Mixed use Substation facilities Institutional Bus shelter P e d e s t r i a n  walkway Retention pond Table 2.9: Project examples of land usage Graph 2.2: Land use breakdown for affordable housing projects 41 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Estimation of cost breakdown for construction and development cost Graph 2.3: Total cost breakdown 42 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

Samples of total construction cost breakdown of the various types of housings in Greater Kuala Lumpur . LEGEND ITEMS COSTS PER ACRE  PER UNIT C O S T   P E R  (RM) UNIT (RM)      5.2% ( D E N S I T Y  7.4% 30/ACRE) 1.3%   Land cost  2,178,000.00 R M   5 0 . 0 0  72,600.00 1.2% 0.9% 8.9% psf 0.4%   L a n d   c o n v e r s i o n  326,700.00 15% of total  10,890.00 cost land cost   I n f r a s t r u c t u r e  300,000.00   10,000.00 works   Construction works  15,459,005.20 RM 250.00  515,300.17 (Building) psf   Landscape works 100,000.00   3,333.33 63% T O T A L   D E V E L O P M E N T  21,304,005.20     (excluding fees)   Pre‐development  213,040.05 1% 7,101.34 cost   Professional fees  1,810,840.44 8.5% 60,361.35 and reimbursable   Goods and services  1,278,240.31 6% 42,608.01 tax TOTAL COST 24,606,126.00   820,204.20 Graph 2.4: Cost breakdown for high rise T20 house Table 2.10: Cost breakdown for high rise T20 house Selling price per square foot (built up) in certain areas of T20 can fetch between RM 800.00 to RM 1,000.00 per square feet. A 1,500 square feet apartment in the vicinity of upscale Kuala Lumpur, can cost a price of up to RM 1,500,000.00. In areas of upscale Kenny Hills land prices can be as high as RM 450.00 per square feet or RM 19,000,000.00 per acre or in Hartamas Heights, the land prices can fetch up to RM 600.00 per square feet or RM 26,157,500.00 per acre. Land cost is a subjective matter, and the prices varies. It however, adds to the overall cost of the housing development significantly. In the city centre of Kuala Lumpur, land cost can only up to RM 3,500.00 per square feet or RM 152,467,000 per acre 43 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

LEGEND ITEMS COSTS PER ACRE  PER UNIT COST PER UNIT  (RM) (RM)      ( D E N S I T Y  18/ACRE)   Land cost  4,356,000.00 RM 100.00  87,120.00 5.2% 0.5% psf 7.4% 0.4% 6.3%   L a n d   c o n v e r s i o n  326,700.00 15% of total  18,150.00 cost land cost   Infrastructure works 300,000.00   16,666.00   Construction works  15,459,005.20 RM 280.00  858,833.62 (Building) psf   Landscape works 100,000.00   5,555.55 TOTAL DEVELOPMENT (excluding  59,541,705.20     0.9% 87% fees) 0.1%   P re‐d evelo pm en t  595,417.05 1% 11,908.34 cost   Professional  fees  5,061,044.94 8.5% 101,220.90 and reimbursable   Goods and services  3,572,502.31 6% 71,450.05 tax TOTAL COST 68,770,669.50   3,820,592.75 Graph 2.5: Cost breakdown for T20 terrace house Table 2.11: Cost breakdown for T20 terrace house 44 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

5.2% 2.7% LEGEND ITEMS COSTS PER ACRE  PER UNIT C O S T   P E R  7.2% 18% (RM) UNIT (RM)        Land cost  R M   2 0 0 . 0 0  ( D E N S I T Y  1.2% 4,356,000.00 psf 6/ACRE)   L a n d   c o n v e r s i o n  653,400.00 15% of total  726,00.00 7.4% 64% cost 300,000.00 land cost 0.9% 15,459,005.20   108,900.00   Infrastructure works 100,000.00 R M   3 5 4 . 8 9    Construction works  20,868,405.20 psf 50,000.00 208,684.05   2,576,500.87 (Building) 1,773,814.44     Landscape works 1,252,104.31 16,666.66 T O T A L   D E V E L O P M E N T  24,103,008.00 1%   (excluding fees)   Pre‐development  8.5% 34,780.68 cost 6% 295,635.74   Professional fees    208,684.05 and reimbursable   Goods and services  4,017,168.00 tax TOTAL COST Graph 2.6: Cost breakdown for T20 semi-D house Table 2.12: Cost breakdown for T20 semi-D house 45 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

LEGEND ITEMS COSTS PER ACRE  PER UNIT C O S T   P E R  (RM) UNIT (RM)      ( D E N S I T Y  4/ACRE)   Land cost  13,068,000.00 RM 300.00  3,267,000.00 psf 5.2% 39% 1%   L a n d   c o n v e r s i o n  326,700.00 15% of total  1,960,200.00 7.4% 0.9% cost land cost   Infrastructure works 300,000.00   75,000.00   Construction works  15,459,005.20 RM 354.89  3,864,751.30 (Building) psf   Landscape works 100,000.00   25,000.00 TOTAL DEVELOPMENT (excluding  29,253,705.20     46% fees) Pre‐development  292,537.05 1% 73,134.26   7.4% cost 0.3%   Professional fees  2,486,564.94 8.5% 621,641.24 and reimbursable   Goods and services  1,755,222.31 6% 438,805.58 tax TOTAL COST 33,788,029.50   8,447,007.38 Graph 2.7: Cost breakdown for T20 bungalow house Table 2.13: Cost breakdown for T20 bungalow house 46 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

LEGEND ITEMS COSTS PER ACRE  PER UNIT C O S T   P E R  (RM) UNIT (RM)      5.2% ( D E N S I T Y  70/ACRE) 1%   Land cost  2,178,000.00 R M   5 0 . 0 0  27,225.00 0.8% 7.4% psf 17% 2.6%   L a n d   c o n v e r s i o n  326,700.00 15% of total  4,083.75 2.4% cost land cost   Infrastructure works 300,000.00   3,750.00   Construction works  8,053,251.40 RM 184.87  115,046.49 (Building) psf   Landscape works 100,000.00   1,250.00 63.6% TOTAL DEVELOPMENT (excluding  10,957,951.40     fees)   Pre‐development  109,579.51 1% 1,565.42 cost   Professional fees  931,425.87 8.5% 13,306.08 and reimbursable   Goods and services  657,477.09 6% 9,392.53 tax TOTAL COST 12,656,433.87   180,806.20 Graph 2.8: Cost breakdown for M40 house Table 2.14: Cost breakdown for M40 house 47 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

LEGEND ITEMS COSTS PER ACRE  PER UNIT C O S T   P E R  (RM) UNIT (RM)      5.2% ( D E N S I T Y  70/ACRE) 7.4%   Land cost  2,178,000.00 R M   5 0 . 0 0  27,225.00 0.9% psf   L a n d   c o n v e r s i o n  326,700.00 15% of total  3,267.00 28% cost land cost 1.3% 4.1% 3.8%   Infrastructure works 300,000.00   3,750.00   Construction works  8,053,251.40 90.00 psf 392,540.00 (Building)   Landscape works 100,000.00   1,000.00 TOTAL DEVELOPMENT (excluding  6,830,100.00     49.7% fees)   Pre‐development  68,01.00 1% 683.01 cost   Professional fees  580,558.50 8.5% 5,805.59 and reimbursable   Goods and services  409,806.00 6% 4,098.06 tax TOTAL COST 7,888,765.50   78,887.65 SUBSIDISED AMOUNT 686,322.59 40%‐60% 4 2 , 0 0 0   –  Graph 2.9: Cost breakdown for B40 house 48,0000 SELLING PRICE 7,202,442.90   3 0 , 0 0 0 . 0 0   –  42,000.00 Table 2.15: Cost breakdown for B40 house 48 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

According to Khazanah Research Institute (2015), theoretically, if the construction cost falls, it is expected that all housing prices would fall accordingly. However, this theory does not seem to reflect in the house prices and construction costs in Greater Kuala Lumpur from the year 2008 to 2014 Graph 2.10: Housing prices vs construction cost in Greater Kuala Lumpur 49 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES

The construction cost for housings in Kuala Lumpur from 2005 to 2015, based on the data provided by Langdon Seah Malaysia (2016); Graph 2.11: Construction cost per square metre in Kuala Lumpur from 2005 to 2015 50 AFFORDABLE HOUSINGS IN GREATER KUALA LUMPUR (KLANG VALLEY) AND URBAN MALAYSIA : PLANNING, ISSUES AND FUTURE CHALLENGES