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Report Taman Sutera Kajang

Report Taman Sutera Kajang

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Published by Mazlin Ghazali

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Published by: Mazlin Ghazali on Mar 18, 2009
Copyright:Attribution Non-commercial


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Sales pattern of low to medium cost walk-upapartment units in Taman Sutera, KajangWHICH FLOORS ARE EASIER TO SELL?
Under current Government policy there exist strict space standards forlow-cost and low/medium cost housing and minimum requirements forthe quality of finishes, services, infrastructure and amenities that arealready in place
. However, housing in the modern context is morethan just roof and walls for shelter, or the provision of basic services likewater and electricity. It is also a major lifetime investment.We believe that the major factors that determine whether a low-costhouse appreciates or depreciates in value have been overlooked bypolicy makers, architects and town-planners. These factors, any valuewill say, are
location, location, location 
. Thus floor levels must certainlycount as one of the most important location factors, especially for walk-up flats without lifts.It is common practice for developers of apartment buildings to price theapartments according to how valuable the units are perceived to be.The factors that contribute towards the perception of value and,therefore pricing, would presumably be relative in size, quality offinishes and so on. But the most important must be location
the floorlevel, the direction of view, the relationship with neighbouring units,ease of access, etc.This common practice is abandoned when it comes to low-cost housing.The government has fixed the ceiling price and this has become the de-facto single price.
Figure 1
Note:This reserve price of RM9000 is not exceptionally low. There are 11other apartments similarly priced(Source: NST UbuyUsell, Tuesday, Aug 22 2006)
A cursory study of Auction Notices over the past year has revealed thatthe Reserve Prices of low-cost flats in locations like Bukit Sentosa,Bukit Beruntung in the north of Kuala Lumpur is around RM9,000, asmall fraction of the original selling price set by Government (
). Ifthis situation is true in general for other locations, it pinpoints seriousdefects in the current low-cost housing policy.Low-cost housing has long been a financial burden to Developers whodo not want to build them but are forced to do so by Government policy.The fixed selling price requires cross subsidy from the sales revenuefrom medium and higher cost units. Yet when the subsidized low-costhousing is built, sales are often slow. The poor do not seem to beenthusiastic about buying them, even though the housing loans are setby Government again at a subsidized rate.So an absurd situation is emerging. Developers do not want to buildlow-cost houses but they are forced to do so by Government policy.The fixed selling price requires cross subsidy from the sales revenuefrom medium and low cost units. Yet when the low-cost walk-upapartments are built, sales are often slow
especially the ones on thetop floors.In this situation it would seem that government policy is forcingdevelopers to subsidize houses they do not want to build and which thetargeted beneficiaries do not want to buy. No wonder
many of theselow cost houses depreciate in value, becoming not assets but afinancial burden!
Researchquestion &objectives:
This research project aims to study the importance of the apartmentfloor level as a location factor. An understanding of this issue based onempirical study would be useful in helping developers formulate apricing strategy that will help them to sell their low-cost houses moresuccessfully. It will also inform people who make and implement policyon how current regulations and practice may be (or may not be) workingtowards the policy aims.This research specifically aims to link apartment floor level to ease ofselling.
Figure 4 Low-costapartmentFigure 2Figure 3 Low/mediumcost apartmentArkitek M Ghazali is the architect of a development in Taman Sutera inKajang, Selangor, part of which comprises low-cost apartments andlow-medium and medium cost apartments (low/medium costapartments) which were designed to meet the regulations in force at thetime the planning application was submitted
(fig. 2).
The first phase of the development contained, among others, 5 blocksof low-medium and medium cost apartments
and 6 blocks oflow-cost apartments. This portion has been completed. The low-costapartments are six storey buildings with units on the 1st to 5th floor

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