Pressure piling on builders

BALIK PULAU: Penang Barisan Nasional is now claiming that the DAP-led state government is piling on the pressure on developers here by demanding that they contribute more funds to Penang.

This has inadvertently led to the rise in property prices as the builders have to pass on the additional costs to the buyers, Penang Barisan working committee chairman Datuk Dr Teng Hock Nan said.

Dr Teng claimed that the state also “arm twisted” the developers to maintain and to landscape open grounds, beautify roundabouts as well as to conduct more corporate social responsibility (CSR) programmes.

As a result, he said, house buyers were charged higher prices as the developers had to spend extra to meet the state’s requests.

“This state policy is burdening the rakyat. The prices of houses today are definitely beyond the reach of many, especially those from middle down to low-income groups,” said the former state executive councillor.

“The costs of maintaining open spaces should be borne by the local authorities, not developers.”

Dr Teng said Penang’s property prices had recorded an average increase of between 50% and 100% over the last three years because of the state policy and consent to the increase in land premium charges.

The state government is reportedly charging developers a premium of RM40,000 for each low-cost housing unit not constructed in a given quota.

This is much higher than the RM8,000 penalty imposed by the former government for each unit.

Dr Teng noted that market prices of condominium units in 2008 were RM250 to RM300per sq ft, but the rate is now RM350 to RM600per sq ft,

“Whereas the terrace house price in 2008 was RM400,000 to RM550,000 per unit, it is now RM700,000 to RM1.4mil per unit.”

“The state is also imposing development charges of RM5 to RM15, which is three times higher,” he said before leading a Barisan walkabout at a Pasar Ramadan here yesterday.

Present were Bukit Gelugor MCA division deputy head and state Barisan working committee treasurer Loh Nam Hooi, Penang Barisan Information head Datuk Dr Loga Bala Mogan as well as state Umno liaison deputy chairman Datuk Musa Sheikh Fadzir and Teluk Bahang assemblyman Datuk Seri Dr Hilmi Yahya.

Penang Rehda chairman Datuk Jerry Chan Fook Sing, commenting on the claims, said the previous state government had also asked developers to make similar commitments.

He said many developers were willing to play their part in the CSR programmes voluntarily such as to adopt roundabouts and beautify open grounds.

“The main factor in the rise of housing prices is the jump in land prices of between 100% and 200%.”

Penang Town and Country Planning, Housing and Arts Committee chairman Wong Hon Wai could not be reached for comment.