Chinese unmanned lunar orbiter returns home


China Lunar_Test Obitor Return homeExperimental orbiter prepares for home trip – CCTV News – CCTV.com English 

China’s unmanned lunar orbiter returns home – CCTV News – CCTV.com English

China succeeded Saturday in the world’s first mission to the Moon and back in some 40 years, becoming the third nation to do so after the former Soviet Union and the United States.

The test lunar orbiter, nicknamed “Xiaofei” on Chinese social networks, landed in Siziwang Banner of China’s Inner Mongolia Autonomous Region early Saturday morning.

Search teams have already recovered the orbiter at the designated landing area, about 500 kilometers away from Beijing.

Launched Friday last week, the orbiter traversed 840,000 kilometers on its eight-day mission that saw it round the far side of the Moon and take some incredible pictures of Earth and Moon together.

The re-entry process began at around 6:13 a.m. Saturday morning, with the orbiter approaching Earth at a velocity of about 11.2 kilometers per second.

The high speed led to hefty friction between the orbiter and air and high temperatures on the craft’s exterior, generating an ion sheath that cut off contact between ground command and the orbiter.

To help it slow down, the craft is designed to “bounce” off the edge of the atmosphere, before re-entering again. The process has been compared to a stone skipping across water, and can shorten the “braking distance” for the orbiter, according to Zhou Jianliang, chief engineer with the Beijing Aerospace Command and Control Center.

“Really, this is like braking a car,” said Zhou, “The faster you drive, the longer the distance you need to bring the car to a complete stop.”

The “bounce” was one of the biggest challenges of the mission, because the craft must enter the atmosphere at a very precise angle. An error of 0.2 degrees would have rendered the mission a failure.

Wu Yanhua, vice director of China’s State Administration of Science, Technology and Industry for National Defense, said the successful test mission has gathered a lot of experimental data and laid a solid foundation for future missions.`
 

Paving way for new probe

The eight-day program is a test run for the final chapter of China’s three-step–orbiting, landing and finally returning–lunar program.

“Xiaofei” is obtaining data and validating re-entry technology such as the heat shield and trajectory design for a future landing on the moon by Chang’e-5.

Earlier reports said Chang’e-5 will be launched around 2017. The goal is to collect samples from the Moon and return to Earth. If successful, China will become the third nation to do so.

Calling “Xiaofei” a pathfinder for Chang’e-5, Zhou Jianliang said the data acquired by the lunar orbiter will optimize technology for Chang’e-5.

Hao Xifan, deputy chief of China’s third phase lunar exploration program, also said the mission validated ground support capacities, craft landing technology and recoverable spacecraft technology.

According to Wu Weiren, chief designer of China’s lunar exploration program, Chang’e-5 is expected to collect a 2-kg sample from two meters under the Moon’s surface and bring it home.

Aside from the high-speed re-entry, major technological challenges for the craft center on surface sampling, taking off from the Moon, and lunar orbit rendezvous, Wu said.


READY TO MAKE HISTORY, AGAIN

China launched a pair of orbiting lunar probes and last year landed a craft on the moon with a rover on board.

Saturday’s success is another step forward for China’s ambition that could eventually land a Chinese citizen there. Few countries can rival China’s space program although China never intended to participate in any “space race”.

In an earlier interview with Xinhua, Wu Weiren said lunar probe technology and software could be of great economic value if adapted for commercial use.

Commercial gains aside, the space program is already a marker of China’s global stature and technical expertise. The Chang’e lunar probes – named after a goddess who took her pet Yutu, or jade rabbit, to the moon – are a symbol of great national pride.

The country sent its first astronaut into space in 2003, becoming the third nation after Russia and the U.S. to achieve manned space travel independently. In 2008, astronauts aboard the Shenzhou-7 made China’s first space walk. There are plans for a permanent space station, expected to be set up around 2022.

The Chang’e-1 and Chang’e-2 missions in 2007 and 2010 respectively, capped the orbital phase of the three step project. Chang’e-1 crashed onto the Moon’s surface at the end of its mission, and Chang’e-2 was sent into deep space to become China’s first man-made asteroid.

The ongoing second phase saw Chang’e-3 soft land on the moon carrying moon rover Yutu in December 2013. Chang’e-4 was a backup for Chang’e-3 and has not been deployed.

In the meantime, Yutu has entered its 11th dormancy earlier October, although its functions have degraded considerably after it encountered control issues in January this year. Experts had feared that it might never function again, but Yutu has stubbornly managed to wake up from its sleep mode ever since.

None of those missions were intended to return to Earth and this has pushed the 2017 mission further into spotlight.

“The Chang’e-5 mission will be yet another historic moment for China’s lunar program,” Wu said.

(Xinhua)

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Malaysia’s residential housing market ‘severely unaffordable’, said Demographia


Chang_HBA

Chang: ‘For the past few years, HBA has sounded the alarm on the risk of a homeless generation.’

WHEN middle income professionals are unable to afford their own home based on a single income and have to team up with either a spouse or another person to qualify for a mortgage loan, then it is a sign that the unaffordability of our housing market has become critical.

A finding by US-based urban development researcher Demographia reveals Malaysia’s residential housing market is “severely unaffordable”, even more out of reach than residents in Singapore, Japan and the United States.

Demographia’s finding, cited by Singapore’s Straits Times in a report on Oct 14, rates housing as severely unffordable if the median of house price to annual income is 5.1 times.

Malaysia clocked in at 5.5 times, showing many Malaysians continue to be locked out of the housing market, compared with Singapore’s 5.1 times, while the United States’ and Japan’s housing markets were found to be “moderately unaffordable”.

Public interest group, National House Buyers Association (HBA) honorary secretary-general Chang Kim Loong says Demographia’s report supports HBA’s own finding that house prices, especially in the urban and sub-urban areas, have risen beyond the reach of many average Malaysians.

“For the past few years, HBA has sounded the alarm on the risk of a “homeless generation” made up of a growing number of young Malaysians especially the lower and middle income groups who are unable to afford their own home. When this homeless group grows in number, it can give rise to many other social problems,” he warns.

Siva_house unafforable

Siva: ‘The fact that salaries have not kept up with the upswing in property prices have further worsened … the situation.’

Chang says when even middle income professionals are unable to afford their own home based on a single income, the situation has become critical.

He says unless one is willing to be tied down by a long-term or back-breaking mortgage or mortgages, the high residential prices have rendered buying a house an increasingly uphill task, if not an impossible feat for the many lower income and average Malaysians.

“The skyrocketed prices have driven house buyers to take back breaking mortgages and many needed to combine their income in order to qualify for a mortgage, thus leaving them with very little or no savings after paying the monthly instalments and other basic necessities.

“This will place families at risk as they could fall into a deficit situation if any sudden emergencies happen to either of the borrowers,” Chang says.

He points out the possibility that in the event these borrowers cannot afford to pay their instalments and the banks are forced to auction off their properties, “there is a risk of a property bubble bursting, just like what happened during the sub-prime financial crisis in the US.”

“The borrowers and their dependents will also be faced with financial and emotional crisis that befalls their foreclosed property. Foreclosures can devastate a family’s economic and social standing, leaving them poorer instead,” Chang laments.

Chang says just six years ago it was still possible for a single middle level manager earning RM5,000 a month to buy a new double-storey link house in Kajang for less than RM250,000, and for a single executive earning RM3,000 a month to buy a new condominium in the Old Klang Road area for about RM200,000.

“Today, a new house in Kajang are in excess of RM700,000 but a middle level manager is just earning RM6,000 or thereabout a month. Recent launches of condominiums around Old Klang Road area are in excess of RM600,000, while the average salaries of executives are still around RM3,500 a month,” he laments.

He believes the maximum price that households with an monthly income of RM10,000 should purchase is only RM360,000 (RM120,000 x 3x).

“HBA has always stressed that affordable housing should be priced around RM150,000 to RM300,000, and not more then RM400,000 even for prime locations. Given that annual household income uses the assumption of two working spouses, there is a critical need for properties priced at RM150,000 to cater to single families and adults.

“We urge the government to further lower the threshold of affordable house price to between RM150,000 and RM300,000, and not more than RM400,00 even for prime locations,” Chang adds.

Chang says these houses, with minimum built-up of 800 sq ft and three bedrooms, need not come with fanciful finishing, but have just the bare necessities for a family’s comfort.

Stemming the greed

Malaysian Institute of Estate Agents (MIEA) president Siva Shanker concurs that the unaffordability housing issue has become critical over the past three to four years due to the sharp upswing in house prices.

“It was driven by the low entry costs with schemes such as no need for downpayment, developer interest bearing schemes and free stamp duty and legal fees, Although the Government has introduced various cooling measures and more responsible bank lending guidelines which has brought down the number of housing transactions, prices or value of houses still remain high.

“The fact that salaries have not kept up with the upswing in property prices have further worsened the unaffordability situation,” Siva explains.

HBA’s Chang points out the risks posed by “Investors’ Clubs” or “Millionaires Clubs” which are basically syndicated speculators incorporated by some ingenious individuals.

“They work in cahoot with developers, valuers and banks. Speculative buyers may be caught by the latest round of cooling measures. How the situation will pan out will depend on the holding capability of these speculators of which most of them may not have. Come hand-over time when it is time for these “investors” to flip their purchases, there may be a shortage of buyers for these properties, most of which were transacted at inflated and not real market value prices,” he warns.

Siva opines that the imposition of real property gains tax (RPGT) to tax gains from property transactions should be counted from the date of completion of the property and not from the signing of the sale and purchase agreement as what is being practised now.

This is given that it takes three years for high-rise residences to be delivered to buyers upon the signing of the sale and purchase agreement, and two years for landed property. Chang says the severity of the housing crisis for many Malaysians today calls for a workable housing delivery model to be put into action urgently before the problem spills over and cause more social problems in the country.

Housing the people has to be made the top thrust of the government and all possible measures need to be put to work fast and bottlenecks must be promptly addressed.

He says much more can be done to ensure a sustainable and orderly housing market for the people, stressing that holistic and concerted efforts need to be adopted.

“However, very often policies adopted are more for political expediency rather than for the betterment of the people.

“We need a single umbrella to monitor, regulate and police the performance of the various agencies that are entrusted with the role to ensure affordable housing index are met and properly distributed to the deserving ones. They must build the right quantity of the right property, at the right location, for the right populace, and at the right price.

“There must be full transparency on the location, number of units, registration and balloting process to ensure fairness to all eligible buyers,” Chang stresses.

A single database will enable individuals to learn about the availability of the affordable housing in their communities or in the communities they planned to move to, and understand financing options avail to them.

Siva also calls for a central planning and delivery agency to plan and coordinate all the affordable housing needs of the people.

“The whole process should be totally transparent with a master registry to record all the database of applicants and successful candidates. There should also be a moratorium period of up to 10 years to ensure that the successful candidates offered these affordable housing will not be able to dispose these homes for quick profit.

“The federal and state governments should provide the land and other forms of incentives to encourage private developers to lend their support for these affordable housing schemes,” Siva says.

Chang agrees that giving incentives to developers that build affordable housing will motivate them to throw in their support to build more of such housing units, adding that building up the infrastructure connectivity to the still relatively undeveloped areas will make these places more accessible and improve demand for property in those places.

“HBA has proposed to the government to take the lead by unlocking more of its vast land banks to build affordable housing for the people.

“The reason why developers are not chipping in to build more affordable housing units is because of the so-called profit maximisation by industry players. It is either high-rise multiple hundred units or high-end luxury units. Very often it is a combination of both – luxurious high-end units.I have not heard of developers building single-storey terrace houses that were so prevalent in the past. Developers are refusing to build such price and low margin items and will rather focus on higher margin items. With land being a scarce resource, developers will maximise the value of their land banks.

“If the land comes from the federal and state governments, private developers will be more willing to throw in their support to develop affordable housing for those in need,” Chang concludes.

Source: ANGIE NG The Star/Asia News Network

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Malaysian homes more unaffordable than Singapore, Japan and US; Budget 2015 brings little joy

Big boost for Asia with the Asian Infrastructure Investment Bank (AIIB) launch, a positive step!


Financing required as Asia remains with looming infrastructure needs

Chinese President Xi Jinping’s (C-R) meeting with the members of the Asian Infrastructure Investment Bank (AIIB) in the Great Hall of the People in Beijing, China 24 October 2014. 21 Asian countries are the founding members of the AIIB, an initiative by China. – EPA

THE launch of the US$50bil Asian Infrastructure Investment Bank (AIIB) is a positive step for the development of Asia where large areas remain with looming infrastructure needs.

There has been good work done by other international bodies, but due to the vast financing needs of the region, there is always place for another major bank to put in the good work.

The AIIB was launched in Beijing last Friday at a ceremony attended by Chinese finance minister Lou Jiwei and delegates from 21 countries including India, Thailand and Malaysia, said Reuters.

It aims to give project loans to developing nations with China set to be its largest shareholder with a stake of up to 50%.

In a speech to delegates after the inauguration, Chinese President Xi Jinping said the new bank would use the best practices of the World Bank and the Asian Development Bank, said Reuters.

The authorised capital of the bank would be US$100bil; the AIIB would be formally established by the end of 2015 with its headquarters in Beijing.

There was a huge demand for infrastructure investment in Asia; the Asian Development Bank (AIIB) put that at around US$8 trillion of investment during the current decade, said the Singapore Business Times (SBT) in a report earlier.

A principal motive in proposing the AIIB was to invest part of China’s US$4 trillion foreign reserves in higher-yielding assets than US Treasury bills, said SBT, also quoting diplomatic sources.

In addressing the potential rivalry between the AIIB and other international aid bodies, one has to look at the big picture in what will benefit Asia in the long run.

If carried out successfully, infrastructure development across Asia will help narrow the gap between the more and less developed areas.

China is already in partnership with India to develop infrastructure and industrial parks in India.

Spreading its infrastructure investments over the rest of Asia would be a natural step towards that development.

After warning on excessive speculation in currency and debt markets, the Reserve Bank of India (RBI) is looking at the low hedging levels by companies and the currency risks they face.

If indirect pressure on companies via their bankers failed, the RBI may consider forcing companies to submit detailed financial information through their lenders, said Reuters, quoting bankers who met with RBI officials earlier this month.

The RBI’s warnings signalled its concern that unhedged firms could be a vulnerable link should global markets buckle, said Reuters.

The central bank had worked hard to build up its defences after India last year weathered its worst rupee crisis in two decades, said Reuters.

Hedging, meanwhile, is expensive because India’s elevated interest rates mean forward premiums are high, said Reuters.

The RBI is keeping tabs on every aspect of companies’ exposure to currency risks.

After working hard to build up its defences on the rupee, the RBI would not want some other segment of the capital market to fail to keep pace.

The bosses at Royal Bank of Scotland (RBS), which is still under government ownership, were dealt an embarassing blow when their proposal to pay high bonuses was shot down.

The Treasury stopped RBS from paying some staff bonuses worth twice their salaries, said Reuters, quoting James Leigh-Pemberton, chairman of UK Financial Investments (UKFI) which controls the taxpayer-owned 79% of RBS.

UKFI had recommended that RBS be allowed to pay that level of bonus to retain staff and attract talent, said Reuters.

Retention of staff is a dicey issue when it involves banks that are still in the throes of reform.

It is a Catch 22 situation where these banks are still experiencing falling revenues and low share prices.

The situation will probably improve when these banks can reap the fruits of their revamp and get off the hook with government owning the stake.


By YAP LENG KUEN… PLAIN SPEAKING  The Star/Asia News Network
Columnist Yap Leng Kuen looks forward to a more balanced infrastructure development in Asia.

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Hong Kong students at risk of anti-China scheming by outsiders; Chinese abroad blast protests


The Occupy Central movement in Hong Kong has lasted more than three weeks. The Hong Kong Special Administrative Region government on Tuesday held talks with the Hong Kong Federation of Students. But given a lack of positivity on the part of the latter during the talks, it remains unknown when the Occupy movement will end.

The external political situation concerning Occupy Central is increasingly clear-cut. Western public opinion has given it full support. Besides, a mix of traditional forces that are confronting the current Chinese regime, including Tibetan, Xinjiang and Taiwan separatists, Falun Gong devotees, and pro-democracy activists, have beaten the drums for the Hong Kong protests like cheerleaders.

The Occupy Central activists and their adherents must wake up. They shouldn’t act as a puppet of those hostile external forces.

With the Hong Kong radical forces becoming a new member, the anti-China camp seems to be expanding. If this is the case, it will yield terrible results.

Hong Kong, the Asian financial hub and a role model for the rule of law, will be held hostage by those hostile external forces, transforming into a battlefield between them and the rising China.

We suggest the Occupy Central activists not take on such a perilous role. Being already embroiled in the political competition in the Asia-Pacific region, they may have been pushed further than they originally intended.

The young Hong Kong students who have participated in Occupy Central should know that China, which is developing rapidly, is their home country and Hong Kong is a part of China’s rise. They therefore enjoy more opportunities than their counterparts from a smaller country. Meanwhile, they have to accordingly take responsibility to safeguard China’s security as it rises.

If the Occupy Central forces keep advancing, this will attract more international anti-China forces. The longer the protests last, the harder it will be for the Occupy Central forces to back down.

Incredible role reversals have often occurred throughout history. A marginal part or even central part of a camp could be converted into the enemies of that camp. We strongly hope the Occupy Central activities won’t do so.

The West-supported external forces will continue cheering for Occupy Central. Exiles will take the Occupy movement as their chance.

Their aim is to strike a heavy blow against China and take it down, but is this the goal of the young student participants of Occupy Central? If not, they should withdraw from the protests as soon as possible.

And for a small number of hostile elements to China, the country knows how to deal with them.

- Global Times

Chinese community leaders in London blast HK protests

Leaders of the Chinese community in Britain on Monday called on protesters in Hong Kong to stop the Occupy Central movement and let things return to normal.

According to a statement issued by the London Chinatown Chinese Association, the Occupy Central movement has disrupted Hong Kong long enough and needs to be wrapped up soon.

The statement called for stability through the “one country, two systems” policy and continued successful economic development for the international financial capital.

Under Hong Kong’s basic law and its top legislature’s decisions, more than 5 million Hong Kong voters have a say in who will become the chief executive in 2017 through the “one man, one vote” electoral system, said Chu Ting Tang, chairman of the London Chinatown Chinese Association, at a forum on the Hong Kong situation in London’s Chinatown.

Residents of Hong Kong, under the “one country, two systems” rule, enjoy freedom of speech, religion, education and employment, Tang said, adding that “residents can demonstrate in the streets, criticize the government, media and members of the legislative body and monitor the government without restriction”.

Tang believes that Hong Kong residents have been enjoying prosperity from a thriving economy and that their standard of living has been improving year by year.

“Since rejoining the Chinese mainland in 1997, Hong Kong’s status as an international center for commerce and trade has been strengthened. The employment rate has also reached an all-time high,” Tang said.

Shan Sheng, president of the UK Chinese Association for the Promotion of National Reunification, noted that the Occupy Central movement has had a serious impact on the residents of Hong Kong by obstructing administrative operations.

The students among the protesters are young, some even not yet in their 20s, Shan said. Their understanding of politics is rather shallow.

Since being implemented in 1997, the policy of “one country, two systems” has been progressing smoothly in Hong Kong, Shan said, adding that real estate and the economy of Hong Kong have thrived.

The current protest movement is negatively influencing that development and the everyday livelihood of Hong Kong residents, Shan added.

Thousands of Hong Kong protesters, most of them students, joined the Occupy Central movement to express their discontent over the process set by the top legislature for electing the region’s next leader through universal suffrage.

China’s Hong Kong government on Tuesday held its first formal talks with students who have been participating in the Occupy Central movement since Sept 28.

- China Daily/Asia News Network

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GST will push up home prices by 2.6%, said Real Estate and Housing Developers Association Malaysia


GST_Home price upBut it says still too early to determine exact increase

PETALING JAYA: Home prices will rise by about 2.6% once the goods and services tax (GST) comes into play, said the Real Estate and Housing Developers’ Association Malaysia (Rehda).

The chairman of the association’s task force on accounting and taxation, Datuk Ng Seing Liong, said that the calculation was based on its consultations with industry experts and member developers.

REHDA_GST prices upReal Estate and Housing Developers’ Association of Malaysia (Rehda) says the GST is likely to raise property prices.

Rehda’s 2.6% estimate differs from that of the Customs Department, which expects the GST to have an impact of between 0.5% and 2% on house prices, assuming there’s no change in supply and demand conditions.

Ng said the association was in full support of the GST and concurred with Customs GST director Datuk Subromaniam Tholasy, who had said that land did not incur the 6% GST rate.

However, he said land was by no means the largest cost component in property development.

“As our calculation clearly spells out, the construction cost, which constitutes 46% of the total development, is not only the largest component but also the component which will attract the GST of 6%,” he said in a letter to StarBiz.

He said the GST on this component would inevitably lead to an increase in house prices.

Appending calculations for a housing unit originally priced at RM400,000, Ng said the price post-GST would be around RM410,560.

Under the 46% construction component, costs were broken down into non-service taxable and service taxable segments, representing 44%, or RM176,000, and 2%, or RM8,000, respectively.

Under the non-service taxable segment comes items such as cement/concrete, steel, bricks and sand, while the service taxable segment includes tiles and fittings/sanitary. Under the existing sales and service tax, no tax is imposed on the non-service taxable category, while the service taxable category has a tax of up to 10% imposed on it.

Post-GST, Rehda’s calculations showed that the non-service taxable cost had gone up to RM186,560, while the service taxable cost remained at RM8,000.

It maintained the same cost estimates for other items, including land (15% or RM60,000), infrastructure and pre-development works (10% or RM40,000), professional fees and marketing costs (6% or RM24,000), finance costs (6% or RM24,000) and profit (17% or RM68,000).

Ng said Rehda also disagreed with Subromaniam, who had said that developers could easily absorb cost increases as their margins were around 30%.

He said it was currently impossible for developers to earn up to a 30% profit, as most development costs were on the rise, along with various capital contributions and charges imposed on developers.

“On average, as tabulated in the calculation, developers, most of which are public-listed companies, are only making around 17% at best,” he said.

However, Ng said it was still too early to determine the actual house price increases post-GST, as Rehda was still in discussions with the Government and there appeared to be many more issues to be ironed out.

By Isabelle Lai The Star/Asia News Network


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More Malaysians are being declared bankrupt!


JOHOR BARU: Young Malaysians are being declared bankrupt because they spend more than they earn, says Minister in the Prime Minister’s Department Nancy Shukri (pic).

This trend was worrying because most of them had just started working but already had debt problems, she added.

“This younger generation are supposed to be the next leaders. Instead, we have those who are already facing financial difficulties at a very young age,’’ she told a press conference after opening an information programme for young people at the Home Ministry complex at Setia Tropika here yesterday.

Quoting figures from the Insolvency Department, she said there was an increase in the number of young Malaysians being declared bankrupts in the past five years.

She said there were nearly 22,000 cases last year, an increase from about 13,200 in 2007.

Within the first six months of this year, more than 12,300 young Malaysians had been declared bankrupt. They include 3,680 women.

“On the average, 70.22% of the cases are men,” said Nancy, adding that most of them have outstanding debts of RM30,000 or more and could not afford to settle their dues.

She said the high bankruptcy rate among Malaysians at a young age mainly resulted from defaulting on instalment payments on car, housing and personal loans.

Nancy said there had been celebrities who were also declared bankrupt but most of them declined to seek assistance from the Insolvency Department.

She added that aside from the department, those who have problems managing their finances could seek advice from the Credit Counselling and Debt Management Agency.

The Star/Asia News Network

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Malaysian homes more unaffordable than Singapore, Japan and the US; Budget 2015 brings little joy


Home affordability_ Dem

File picture shows houses under construction in Kuala Lumpur. Malaysia has a ‘severely unaffordable’ residential homes market, according to researcher Demographia.— AFP

KUALA LUMPUR, Oct 13 — Malaysia has a “severely unaffordable” residential homes market, with housing even more out of reach for its residents than in Singapore, Japan and the United States, according to US-based urban development researcher Demographia.

Demographia’s report was cited today in a report in Singapore’s Straits Times newspaper to highlight how many Malaysians continue to be locked out of the residential housing market despite the federal government’s attempt at helping first-time house buyers.

According to the ST report, Demographia rates housing as severely unaffordable if it is 5.1 times median annual income. Malaysia clocks in at 5.5x, higher than Singapore’s 5.1x, while housing in the United States and Japan is “moderately unaffordable”.

Government data cited by the ST report shows that since 2012 median monthly household income has risen eight per cent annually to RM4,258, slower than the average housing price increase of 10 per cent to RM280,886.

The country’s consumer price index has risen by an average of 3.3 per cent this year and Putrajaya had warned it may spike by 5 per cent next year, tripling the 2013 average.

In presenting Budget 2015 last Friday, Prime Minister Datuk Seri Najib Razak introduced a Youth Housing Scheme that will waive down-payments and subsidise ownership by up to RM10,000 for 20,000 married couples under 40.

Najib also said the government would provide another 80,000 new homes priced at RM100,000 to RM400,000 under the 1Malaysia People’s Housing Programme (PR1MA).

Both schemes, including the existing My First Home (MFH) scheme are only for households with a combined monthly income of less than RM10,000.

According to Bank Negara only a third of My First Home applicants received loans in the first year, as banks refused to take risks.

And PR1MA has seen just 761 buyers for the 160,000 units launched since 2013.

“We earn just over that but it’s not enough for savings. We can convert rent into loan repayments but we can’t pay the 10 per cent deposit,” lawyer Puteri Mohamad told the Straits Times in commenting on the Budget proposal to help households earning less than RM10,000 monthly to buy homes.

Office administrator Mimie Azriene Mohd Zin, 32, has no children but she and her technician husband have applied for a PR1MA home.

But she told the Straits Times they have not figured out how to afford the down payment on their combined income of under RM4,000 a month that leaves them with little savings living in expensive Kuala Lumpur.

“We might not even be able to afford the repayment but we have to try before prices go up further,” she told the daily.

Source:  http://www.themalaymailonline.com/

Malaysia’s budget aid brings little joy to house hunters

Despite being a partner in a law firm just outside Kuala Lumpur, Ms. Puteri Mohamad, and her fiance, can only watch as apartments in the area where she lives spiral above 500,000 ringgit (US$153,334).

When the government proposed measures in its 2015 Budget — released on Friday — to help households earning less than 10,000 ringgit (US$3,067) monthly to buy homes, she was not at all elated.

“We earn just over that but it’s not enough for savings. We can convert rent into loan repayments but we can’t pay the 10 percent deposit,” said Puteri, 33, who lives in a rented flat in Petaling Jaya.

Many Malaysians like her find themselves locked out by a combination of what U.S.-based urban development researcher Demographia rates as a “severely unaffordable” residential market and accelerating inflation.

Malaysia’s consumer price index — which includes many subsidized goods — has risen by an average of 3.3 percent so far this year and the government warns it may spike by 5 percent next year, nearly triple the 2013 average.

Government data shows that since 2012 median monthly household income has risen 8 percent annually to 4,258 ringgit, slower than the average housing price increase of 10 percent to 280,886 ringgit.

Demographia rates housing as severely unaffordable if it is 5.1 times median annual income.

Malaysia clocks in at 5.5x, higher than Singapore’s 5.1x, while housing in the United States and Japan is “moderately unaffordable.”

Prime minister Najib Razak said in his budget speech the government would provide another 80,000 affordable homes (priced at 100,000 ringgit to 400,000 ringgit) under the 1Malaysia People’s Housing Programme (PR1MA) and introduce the Youth Housing Scheme that will waive downpayments and subsidize ownership by up to 10,000 ringgit for 20,000 married couples under the age of 40.

Both schemes, as well as the existing downpayment waiver under the My First Home scheme, are only for households with a combined monthly income of less than 10,000 ringgit.

The National Housebuyers Association lauded the moves to help aspiring homeowners in financing but criticized the lack of new measures to cool rising prices that are the root of the problem.

Its secretary-general, Chang Kim Loong, said speculators have taken advantage of the low entry cost of buying a property at the expense of genuine buyers.

Office administrator Mimie Azriene Mohd Zin, 32, has no children but she and her technician husband have been unable to even think of home ownership until these schemes came along.

They applied for a PR1MA home, which the government says is priced 20 percent lower than comparable units, worth about 200,000 ringgit three months ago.

But they have not figured out how to afford the downpayment on their combined income of under 4,000 ringgit a month that leaves them with little savings living in expensive Kuala Lumpur.

“We might not even be able to afford the repayment but we have to try before prices go up further,” she said.

That is, if she can get a loan in the first place. The central bank reported that only a third of My First Home applicants in the first year received loans as banks refused to take the risk.

Tellingly, even PR1MA saw just 761 buyers for the 160,000 units launched since 2013.

BY By Shannon Teoh, The Straits Times/Asia News Network

Related:

Annual DhiDemographia International Housing Affordability Affordability Survey: 2014

PDF]10th Annual D hi Demographia International Housing

http://www.demographia.com/dhi.pdf

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