What is Affordable House & Public Market Unit | Important Criteria

How to read this article?

Basically I’ve gathered info & amended accordingly so that to save your time and straight to the point to give you the answer that you’re looking for. Those BOLD / HIGHLIGHTED & bracket are my personal comment and if you’d like to save your time I’ve remarked the part that you can skip it and the rest are copy paste and amended by me from other articles just for your extra info.

(Now I think affordable house is pretty straight forward so I’ll skip the explanation. You might hear property agents or developer mention “open unit”, “open market” or “public unit”. Now you can refer to next part to know what it is actually.)

Open Market Units 

In order to stimulate the development of affordable housing, it has also been decided that 30% of the units in any particular 100% affordable housing project may be sold to the open market, with the following condition:

• The units are to be sold at 10% above the controlled price in South West, SPU, SPT and SPS districts. (this might change from time to time which is not that important for you to know)
• The units are to be sold at 20% above the controlled price in North East district. (this might change from time to time which is not that important for you to know)
• The purchaser has to be a registered voter in Penang (The last I heard some projects you don’t have to be voter in Penang, only for public/ open market units ya)
• The purchaser can only purchase ONE such affordable housing unit
• The said unit cannot be sold within 5 years from the date of vacant possession. (I’m not sure if it is VP or from the date of S&P signing, you can clarify with your lawyer which is the most accurate)

In short, public market unit is priced higher than affordable unit by at least 20%. Yes you hear the word, “at least 20%”. Certain affordable project in Penang like Grace Harmony & the Dew. The Dew’s affordable unit priced around RM 320,000 onward while the public market unit priced RM 420k onward. Well, you do the math, in this case for sure more than 20%

And then you will ask, why so expensive!? Well, because it is in Penang Island and it is having limited land which means to say “rare” / limited.

Any difference? Why so expensive?

Again, usually there’s not much different in terms of specification given by developer but because public market unit is priced higher, usually developer will give slightly better advantage like: corner unit, higher floor, extra carpark & etc.

So why people want to buy public market unit?

1. Because run out of unit, no choice / option left
2. They are having more than 1 or 2 properties which caused them failed to fulfil the criteria, usually investor or parents joint name to buy for children & other possible reason
3. They are not from Penang/ relevant state therefore they cannot buy at a preferred price / own the affordable unit. For example, if I’m from KL but I come to Penang to buy affordable house, which is not allowed. If it is allowed there will be people barking. So which is why outsider has to buy public market unit.

(you can skip 3 paragraph from here) Property prices have increased over the past decades, but our incomes are not keeping up. Saving up for a down payment for a home can take years, while paying off a mortgage for a home that’s beyond your affordability can be a struggle.

One way to ease the burden can be through an affordable housing scheme. These schemes either offer low- and medium-cost housing solutions or financing to fulfil your home ownership dream or at least to own a house / home.

But which schemes are you eligible for? Here’s your guide to affordable housing schemes in Malaysia.

Are You Eligible For An Affordable Housing Scheme / Program ?

What is the criteria to be fulfilled in order to be eligible for affordable housing scheme / program.

I’ve summarized all the important criteria, I’ve lumped in all together but basically they are more or less the same just slightly different across different state requirements

In short, all these affordable house in Malaysia are having similar qualification / criteria to be fulfilled which are:

1. You have to be a Malaysian of course
2. A registered voter in the state (if you want to buy an affordable house in Penang then you have to be Penang’s registered voter)
3. Age 18 or Age 21 & above (some states are different but it is the same to be honest because you still have to go to bank loan application while it is almost impossible for bank to approve the loan for an 18 year old adult. Which means to say you still have to get a joint borrower with you which is still 2 names involved and another 1 will be older than you, could be your parent or spouse or Aunty or Uncle Wong)
4. Income cap from RM 2,500 – 15,000 depends on the house price you’re purchasing
5. Only 1^st or 2^nd house (depends on state approval as well)
6. No record of impaired financing for the past 12 months
7. Of course, you gotta have income / salary otherwise how you gonna pay your housing loan

*****Remember, the eligibility and requirements still controlled by the State Government, such as in Penang and Rumah Selangorku. Just check their respective website or make a few phone calls you will get the latest criteria.

What is the application process really like?

It is actually very simple, you don’t have to go through government department to apply for most of the affordable project. Instead, you can just go directly to developer’s office or any appointed sales agent. Don’t wait for the government department to reply, Malaysia Boleh, you know sometimes it takes forever but yes I admit it’s getting better compared to long time ago.

Sometimes banker will duty / station at developer office / sales gallery as well so don’t worry about the bank or loan application issue.

Documents to ready:

1. A copy of the identity card (IC) of the applicant and spouse;
2. Copies of identity cards or birth certificates of children/dependents;
3. Copy of the Marriage Certificate/Marriage Register/Letter of Divorce/Death Certificate of spouse;
4. Single Confirmation letter from employer or Commissioner of Oath for self-employed applicants who are not married (sometimes you’re not asked to provide this);
5. The latest pay slips or income verification from the Commissioner of Oaths if self-employed (6 months payslip is better in order for you to prepare for bank loan application);
6. Statutory declaration from the Commissioner of Oaths, if the spouse is unemployed;
7. EPF statement (if any);
8. A copy of water bill or electricity bill (sometimes it is not required);
9. Possesses no more than 1 property (either applicant or the spouse), if any; and
10. CCRIS report (for them to check your credit / financing status, if you’re credit impaired, means you didn’t pay your loan on time, then, bye, see you next year)

I think you can skip the information I gathered below. The above should be sufficient for your knowledge