The Penang government is introducing the first low-cost rent-to-own (RTO) housing units on the island to those who cannot afford their own homes.
State Housing, Local Government, Town and Country Planning Committee chairman Jagdeep Singh Deo said the scheme located off Jalan Kuala Jalan Baru here was meant for those who could not afford to even buy low-cost units due to high loan rejection rate.
He said there would be four blocks, of which half would come under the RTO scheme.
The project by Ideal Property Group has 1,175 units, with each unit at least 650sq ft with three bedrooms.
“But it should be similar to the Taman Sungai Duri Permai project in South Seberang Prai, where each tenant pays RM150 as rental and RM20 maintenance fee each month for 23 years before owning the unit.
“The state Housing Department will be supervising the process,” he said, adding that the state had identified another RTO scheme housing project in Kampung Tok Subuh, Central Seberang Prai.
Property developer Ideal Property Group senior construction manager Ang Eng Huat said the project is scheduled for completion by first quarter of next year, adding that construction works are now 70% completed.
Jagdeep said unlike renting the People’s Housing Project (PPR), the RTO scheme allows the tenants to become owners after renting for a period of time.
He said they tried out pilot projects with the RTO scheme on two housing projects in South Seberang Prai – Taman Seruling Emas and Taman Sungai Duri Permai.
“Tenants of Taman Seruling Emas only pay RM100 a month and a RM20 maintenance fee for 15 years. The government is subsidising RM5,000.
“The actual price of the unit is RM25,000 but we are only charging the prospective buyer about RM22,000.
“As for the Taman Sungai Duri Permai low-cost housing project costing RM42,000, the tenants pay RM150 per month and RM20 maintenance fee for 23 years.
“The RTO scheme for the two projects is successful,” he said.