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An Interview with Y.B. Dato’ Iskandar Abdul Samad

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First and foremost, we at Homefinder would like to take this opportunity to thank Y.B. Dato’ Iskandar Abdul Samad for spending the time to share with us his ideas and views.

 

The following is a transcript from our interview with the YB. Homefinder…Own It, Live It! – HFM

 

As Selangor’s State Housing, Building Development & Urban Living committee chairman, what is your primary portfolio in the property development scene in Selangor, specifically related to residential properties and affordable homes? What are the relevant or related state government policies with regard to affordable homes and social housing in Selangor?

I have three portfolios in total – firstly is Housing; the second is Building Management; and the third one is Urban Living. The Housing portfolio is pretty straightforward, that it, it is used to provide enough of adequate state housing for all. Enough or adequate housing for all does not necessarily mean that people must buy the house, because there are people as well as segments of society that long to buy houses, but who basically cannot afford to do so. So it is either to provide affordable houses for them to buy or affordable houses for them to rent. That is under housing basically. Second portfolio is building management. This has to do with stratified buildings. It is basically management of stratified buildings, and governed by a new law or building code, called Strata Management Act 2013 (Act 757) which came into effect in June 2015. This new and revised strata law, which is applicable to all building proprietors (owners), operators (landlords) and leasers (tenants), may be to resolve all outstanding maintenance fee payments with regard to infrastructure & building management to all the respective land owners and strata holders. The third portfolio would be urban living. Previously, it was “squatters”, then we changed it to “urban pioneers”. Urban living is much more widespread in definition. In terms of squatters, there are not many left around. So now we deal with urban living – the dwellings or the houses which are more “liveable”. It is also integrated into other departmental portfolios. For welfare and local government, we work hand-in-hand with the state government authorities, local council committees, as well as ministerial bodies.

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With the federal government’s drive towards building more affordable houses for the people, what is the state government currently doing to help those in need of affordable housing in acquiring homes which are within reasonable financial grasp or reach of the average citizen, particularly in the state of Selangor? Could you elaborate more on the various initiatives and projects undertaken by the Selangor housing committee in this respect?

Number one would be to build more affordable homes. Number two would be in terms of financing; the rakyat are having problems with affordable housing. We have launched close to 15,000 units of affordable houses this year alone. What is happening today is that persons or individuals who wanted to buy or purchase these houses; they have given their names to developers and a fair number of them have been rejected. Henceforth, we have essentially two schemes in our programme. One has already been implemented – it is called Dana-Sel (popularly known as Dana Selangor). It is basically a “rent-to-sell” housing scheme. In this particular scheme, we have with two pilot projects incorporating low-cost flats in Sungai Sering and Rimba Jaya respectively, which are meant for people who cannot obtain housing loans or are unsuccessful in their loan applications. So we will buy the houses from the bank and then rent them to the people. Maybe after 2-3 years, when they can afford to buy the house or when their income have already increased, we will sell it back to them and deduct part of the rent which they need to pay. A house which costs RM42,000; during the period which they have stayed there – maybe they have paid RM5,000 or so – we minus or subtract the amount from the houses. Home buyers would save a lot from paying rent whilst the state government would have to bear the excess cost of the houses. Even if they cannot obtain a loan, they can continue to pay their rent until it covers the full price of the unit, by which time they can keep the house.

 

The second pilot project is the project which we have already signed an agreement with a corporate bank which was in the news recently. In this project, we put in or “invest” a certain amount of money into some funds with the bank as a guarantor for people to buy houses. This special fund is specifically for properties in Selayang Mutiara (also known as ‘Bukit Botak’ previously). There was a squatters relocation project for the area under the purview of PKNS. Since the properties there are generally not “bankable” or profitable, the state government had an agreement (MOU) with Maybank; so the bank will foot the bill or cost of the entire project. Nonetheless, we are still required to put in some money into Maybank, i.e. a staggering sum of RM250 million in fixed deposit in the form of insurance or security collateral. More projects will be announced in the immediate future. In reality, the problem is not obtaining the numbers to build the houses. The problem is actually getting the housing loan or financing from the bank. It has something to do with some central banking guidelines from Bank Negara perhaps. Maybe Bank Negara should do something about this enigmatic and teething guideline which has contributed to residential buyers’ dilemma not only in the state but all over the country as well.

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On a lighter note, having attended the Majlis Perumahan Negara (i.e. National Housing Committee) recently, whereby the state government expressed their concern regarding the lack of federal involvement or federal housing initiatives in Selangor. Although we have PR1MA, there are still numerous PPR schemes that have yet to be built in the state. There is also the PPA1M (Projek Perumahan Awam 1Malaysia) which is low-cost housing meant for government servants. There are roughly about 500 units of PPA1M housing in Selangor itself. Apart from having an abundance of land bank in Selangor, the state government has also been willing to cooperate with the federal government to collaborate on affordable and ‘people-centric’ housing initiatives. Selangor always had ample or abundant resources, both natural & financial.

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Of course, building more affordable and social housing is certainly a noble cause and charitable effort by the state government in providing cheaper housing alternatives to the general public. Another fundamental issue of primary importance is the availability of housing loans to genuine housebuyers as well as would be first-time homeowners. What can be done to alleviate their woes or grouses in securing credit or loans for their ‘first home’?

The fundamental problem today is that there are insufficient affordable houses, especially for young couples and families, as well as for those commencing work or seeking employment. The solution is we would impose a certain quota for developers to build affordable houses. For developments covering 10 acres and above, developers would have to provide 30-40% of affordable housing, with the price per unit or lot of less than RM250,000. In our quest to provide adequate affordable housing, this is generally better and more effective than what PR1MA (Perumahan Rakyat 1Malaysia) has to offer. PR1MA homes are typically priced between RM300,000 and RM400,000. Rumah Selangorku prefers to keep the price of their affordable homes low at around RM200,000-250,000 because it is no surprise that the average or mean income for most families is around RM4,000 per month. With respect to RM400,000 or RM500,000 homes for that matter, people with monthly incomes of between RM3,000 to RM4,000 could ill afford to obtain the relevant housing loans for such homes. In return, we allow developers to increase the density of their respective developments to about 120 units per acre; before this it was only 80 units per acre. In terms of incentives, firstly would be to increase the housing density. Secondly, development fee or charges which developers themselves would have to fork out or pay would be gradually minimised. For normal or conventional housing developments, we waive the fees or charges. Thirdly, is in terms of the premium – sometimes developers tend to “subdivide” (i.e. to convert the land usage from ‘agricultural’ to ‘housing’ for example) their land banks to maximise profitability or to engage in profiteering. And since the premium imposed upon developers would be much higher, there is a substantial discount for premiums to encourage developers to build more affordable houses.

 

In light of the rising or escalating crime rate in residential neighbourhoods, more and more residents are opting for (or in favour of) gated & guarded developments within their local townships. Security has always been a major criteria and utmost concern for potential house buyers in choosing their prospective homes. What are the council’s immediate plans for introducing legal provisions to existing state housing enactments in compelling property developers to provide or incorporate an optimal & standard security system or package into future developments? What are the practical measures to alleviate the fears of residents?

There exists several provisions under the Lembaga Perumahan Hartanah Selangor (LPHS), and also under the PBT (pihak berkuasa tempatan) or local government authorities as well as their respective local government committees, especially the various legal provisions as well as strict building and development guidelines with respect to gated & guarded communities, not to mention special protocols and procedures to be adhered to. We do understand and sympathise with residents’ fear, angst and grouses with regard to the escalating crime rate and statistics surrounding their respective gated & guarded neighbourhoods. Nevertheless, they would still have to abide by specific rules & regulations. In terms of the guardhouse, for example, to obtain the TOL (temporary occupation licence) from the local district council and planning office. Also, in reality, residential communities or neighbourhoods are not allowed or permitted to put down their security boomgates, except for a specified duration daily or during the day. Because the problem is that there are public amenities or facilities, such as surau (prayer hall), children’s playground and public park, which must be allowed access by people living outside the area in question, especially those from neighbouring residences or other residential communities. We nevertheless do have our own initiatives with regard to the gated & guarded social trend or fad.

 

For stratified buildings, we have a security scheme known as SEROJA (Skim Rondaan Kejiranan) – a volunteer corp, i.e. a security patrol team made up of volunteers from their respective neighbourhoods. It is akin to the nationwide Rukun Tetangga in its modus operandi, but it is governed by the state itself. For this year alone, we would be targeting some fifty-five (55) select residential communities, with every community’s residential association given about RM10,000 for each residential development to undertake community projects and purchase of equipment. So each JMB (joint management body) or MC (management chairman) receives RM10,000 per annum or annually to fund their patrol operations as well as other activities. Incidentally, SEROJA being a residential volunteer corp, is a security patrol initiative similar in function & operation to the PPS in Penang or the federal-level RELA, and even mildly resembles PDRM’s Polis Bantuan in job details & description. However, like most public initiatives, it is carried out in conjunction or in cooperation with the police naturally. Unlike RELA (which was established under a federal act), SEROJA essentially comprises a group of residential volunteers doing security patrols within their respective housing communities or neighbourhoods. All potential members of SEROJA are scrutinised and screened for criminal offences before joining.

 

Is the state government currently embarking on any educational programs for the public with respect to property investment? The ever-increasing or proliferation of speculation on the property market has brought about the skyrocketing of property prices. It has certainly created issues with regard to the “unaffordability” of homes and their exorbitant prices.

Not at the moment, unfortunately. Rather than dealing with property speculators, our main focus is helping people to get their money and their property. However, we do have a specific rule pertaining to Rumah Selangorku, regarding a certain ‘moratorium’, i.e. you cannot sell for the first five years with your initial or ‘first-time’ property purchase. However, in terms of getting or having an education, the state government has no immediate plans whatsoever. Maybe in the foreseeable future perhaps? Presently, our focus is on the 15,000 unsold units of low-cost houses and affordable homes in the state of Selangor, under the Rumah Selangorku housing program, most certainly. Our priority is trying to get the people or the rakyat to register for their first homes, as well as to plan and purchase their houses early or without delay.

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Since the implementation of the GST and the current volatile property market in Malaysia, how do you see the prospect of property development in Selangor, with respect Bumiputra properties in the foreseeable future? What is your take on the so-called ‘market uncertainty’?

There is still reasonable or modest demand for property although the current property market is cooling off, partly due to the GST on property as well as the devaluing of our local currency, i.e. the ringgit nose-diving in value. People will still purchase property and developers will continue to build property. There have always been talks about the so-called ‘property bubble’ bursting some years back, but so far the bubble itself has yet to burst, even until today. The real concern with GST is that, since the price of Rumah Selangorku homes are fixed and due to the overall increase in property price, developers would try to cut cost and hence, house-buyers generally get or receive shoddy works which typically translates to poor quality housing. Because of this fact, a quality-control body or oversight committee on state housing & property called QUASEL (i.e. Quality Selangor) was established. It basically oversees or tracks the quality of housing and property developments in Selangor. This is also to ensure property developers in the state will not resort to cutting corners to make a quick buck or an instant profit.

 

Any immediate action plans by the Selangor government on how to revitalise & reinvigorate the local property market? What are the essential steps and measures taken by the state government to protect the interest of Bumi developers & investors – business or otherwise?

We have also established Perumahan Hartanah Selangor Sdn. Bhd. (PHSSB). This is a property company which literally “buys back” unsold “Bumi quotas” (i.e. Bumiputra properties which cannot be sold) from property developers. PHSSB basically purchases these unsold lots from the developers, somewhat like a ‘clearing house’ of sorts. If developers are unable to sell their Bumi lots within a specified period, duration or time frame, those properties meant for Bumiputras will be bought over by PHSSB instead of releasing them into the market. At the moment, the company rents out the property lots instead of reselling them in the market, unlike other conventional property companies. This is due to the rather steep or pricey ‘real property gain tax’ (RPGT) with regard to buying & reselling property and real estate in Malaysia. Since developers have always had trouble “off-loading” their unsold Bumiputra properties, that would truly be the purpose and objective of what PHSSB represents to developers in Malaysia.

 

avAny immediate action plans by the Selangor government on how to revitalise & reinvigorate the local property market? What are the essential steps and measures taken by the state government to protect the interest of Bumi developers & investors – business or otherwise?

We have also established Perumahan Hartanah Selangor Sdn. Bhd. (PHSSB). This is a property company which literally “buys back” unsold “Bumi quotas” (i.e. Bumiputra properties which cannot be sold) from property developers. PHSSB basically purchases these unsold lots from the developers, somewhat like a ‘clearing house’ of sorts. If developers are unable to sell their Bumi lots within a specified period, duration or time frame, those properties meant for Bumiputras will be bought over by PHSSB instead of releasing them into the market. At the moment, the company rents out the property lots instead of reselling them in the market, unlike other conventional property companies. This is due to the rather steep or pricey ‘real property gain tax’ (RPGT) with regard to buying & reselling property and real estate in Malaysia. Since developers have always had trouble “off-loading” their unsold Bumiputra properties, that would truly be the purpose and objective of what PHSSB represents to developers in Malaysia.

 

Last but not least, what are your hopes & aspirations for property development and property investment in Selangor as well as in Malaysia? How can we build a better future & tomorrow for all Malaysians in relation to real estate developers, property investors and home-owners?

Our main concern is to obtain better quality and more affordable homes for the people or in general. We should neither be concerned nor worried about the plight of property developers, particularly the niche or high-end property market, i.e. boutique & luxury developments. This is because they have been constantly building projects and spewing out endless property developments like there is no tomorrow. Everywhere you go or turn your head, there are bound to be some form of property development taking place along the roads and highways; countless properties (both residential & commercial) occupying landbanks and saturating the marketplace. The real issue or problem lies with affordable homes for the needy. It is not just about building affordable housing, but building affordable quality homes for the communities.

 

aAbout Y.B. Ir. Dato’ Iskandar Abdul Samad, D.P.M.S.

Dato’ Iskandar Abdul Samad, is currently the Chairman of the State Housing, Building Development & Urban Living permanent committee in Selangor. He is also a state executive councillor, i.e. Ahli Dewan Undangan Negeri (ADUN) of Chempaka state constituency (N21) in Selangor under the political banner of PAS. He is the Selangor PAS commissioner. He presently lives in Taman Kencana, Pandan Indah, Kuala Lumpur and is married to Y.Bhg. Pn. Salasiah Zakaria, and is blessed with six children, including five sons and a daughter. His father, Abdul Samad Ahmad, was with a leading Malay newspaper for more than thirty years. His father’s past colleagues include the likes of Haji Subky Latif, Abdul Shukor Harun (ex-editor at with Harakah), and Suhaimi Mokhtar (previously chief editor at Harakah). His mother Maimunah Dasmi is a full-time housewife or homemaker.