Penang to offer rent-to-own schemes for low-cost homes

GEORGE TOWN: The Penang state government intends to convert some of its low-cost housing into rent-to-own schemes, with plans to introduce more in the future, Penang Chief Minister Chow Kon Yeow said today.

Chow said the decision had already been made at the first state executive council meeting.

The lawmaker said from time to time, tenants had asked if the local council could sell the units they were renting to them on the basis that they had been renting for so long and yet remained mere tenants.

“At the first state executive council meeting, we had focused in principle on introducing rent-to-own schemes.

“This is because even when low-cost homes are priced at RM42,000 and low-medium-cost homes at RM72,000, many are still unable to own them.

“There are also cases of them being unable to get bank loans to buy and own these homes.

“We are looking into this rent-to-own scheme, whereby rent that is paid for 20 to 25 years will eventually be considered as instalments.

“The homes can then eventually be owned by tenants,” he said after visiting a Penang Island City Council (MBPP) housing project on Lebuh Ah Quee here today.

Chow, who is also Padang Kota assemblyman, said there were rent-to-own schemes for some projects previously, but very few remained now.

The state has since decided that several existing projects be converted to rent-to-own schemes, instead of directly selling them as low-cost units.

“Please give the housing office some time to fix the criteria and mechanism for this policy to be implemented,” Chow said.

The projects identified for this scheme are those undertaken by the Penang Development Corporation (PDC). One of them will be the low-cost housing project in Mak Mandin, Butterworth.

Chow said the state can lead efforts to shift to the rent-to-own scheme to ensure that all the low-income earners can own their own homes.

He also expressed hope that apart from the state government, developers could also provide such housing.

“The developers can sell the low-cost units to us at cost price so that the state can then offer the rent-to-own option to those eligible.”

During the visit, Chow said the MBPP had allocated RM500,000 to replace the roofs of the two blocks next year.

Since 2008, Chow said the state government had spent close to RM360,000 to maintain and upgrade the apartments.

These are one of two public housing schemes by the local council. Built in 1960, they have shoplots on the ground floor.

Chow said the rental was between RM112 and RM117 a month for the homes. The rental for the shoplots is between RM208 and RM758, which is below the market rate.

“This is a social housing project. It is the social commitment of the local government. It does not bring us any profit.

“As such, it is our hope that the residents can help the government take care of their properties and build a sense of ownership.”

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