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Rent-to-own scheme for PPR next yr
Published on: Sunday, December 25, 2016
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Kuala Lumpur: The Ministry of Urban Wellbeing, Housing and Local Government will implement rent-to-own scheme for the People's Housing Project (PPR) starting 2017. Its Deputy Minister Datuk Halimah Mohd Sadique said the rent-to-own scheme was meant for house buyers who were eligible for PPR but failed to secure loans from financial institutions.

She said these buyers were denied housing loans either because they could not provide pay slips or proof of income required by banks or financial institutions, or they were considered risky borrowers who may be unable to repay the loans.

"The ministry believes that it is time for us to introduce the rent-to-own scheme to help the target groups comprising the B40 (bottom 40 per cent income group) to own a home."

Halimah said this when answering Barisan Nasional (BN) Senator Datuk Chin Su Phin's question on when the rent-to-own scheme for young people to own a home would be fully implemented for all affordable housing projects implemented by the Government during the Dewan Negara sitting here.

She said the PPR housing programme was introduced in 1998 to enable low-income groups to rent affordable homes as well as for the resettlement of squatters in urban areas.

There are two categories of PPR under the ministry, Halimah said, namely PPR units for rent or sale at affordable price.

"The rental of PPR housing is RM 124 per month, collected from the residents for maintenance of elevators, garbage and so on."

Meanwhile, Halimah said PPR homes were also sold at RM 35,000 per unit in Peninsular Malaysia and RM 42,000 per unit in Sabah and Sarawak, in line with the Cabinet's decision on Feb 27, 2007.

"The cost per unit of PPR is between RM120,000 and RM160,000," she said. She said the Cabinet meeting on Aug 3 this year has agreed with the proposed implementation of the rent-to-own scheme for PPR.

As a start, Halimah said the scheme would be implemented for PPR houses in Kampung Hassan, Lembah Subang 2 and Ladang Seliau, adding that other projects considered by the ministry would be raised in the Cabinet to decide.

In his supplementary question, Chin asked for the number of PPR tenants who have been offered to buy their units and the amount of tenants who rejected the offer. Chin also wanted to know if the ministry planned to offer young people an opportunity to own a PPR unit which tenants did not intend to purchase.

Halimah said the rent-to-own programme was new and thus the ministry would invite qualified buyers for a briefing session on hire purchase scheme, submission of bids, rentals and so on.

Under the rent-to-own scheme, she said potential buyers would be given a probation period as well as a 10 to 25-year loan with low interest rates. She said those eligible for the scheme would be allowed to rent a PPR house for two years.

"If they are able to pay the rent for the next two years and adhere to the conditions laid out by the National Housing Department, they will then be included in the rent-to-own scheme."

She said the rent-to-own scheme was open to Malaysian citizens above the age of 18 whose household income was less than RM 2,500.

Halimah added that the ministry would propose to the Cabinet to ensure that only households earning less than RM3,000 a month and first home buyers were eligible for the scheme.



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