Study on Housing for the Bottom 50% Income Group and the Challenges of Urbanization In Malaysia

What is this project about?

 According to World Urbanization Prospects , Malaysia has 72.8% of its population living in urban areas in 2011. | Photo: UNDP Malaysia

This is estimated to be a 21-month project (January 2014 – September 2015) focusing on housing for the bottom 50% of income group in major urban centres of Malaysia, with clear linkages to relevant initiatives and projects in the 10th Malaysia Plan (10MP) and the National Housing Policy (NHP) with the aim of providing inputs to the 11th Malaysia Plan (11MP) and a larger study on the Urban Vulnerable Group (UVG) by the Economic Planning Unit (EPU). It emphasizes on multidimensionality and linkage to wider issues of urbanization in its analysis. Through a combination of primary research, socio-spatial mapping, international best practices, literature review, desk research and stakeholder consultation, a full report capturing key findings and implementable policy recommendations will be put forward in a clear manner to stakeholders. A series of more technical inputs will be commissioned to supplement the main report. The EPU Social Services Section is the Implementing Partner guided by a National Steering Committee (NSC) and a Technical Working Committee (TWC).

What is the current situation?

 There is a need to review the institutional processes underpinning the provision of the entire range of housing with a focus on low-, low-medium and medium-cost housing given the new and changing urban and demographic landscape in Malaysia. | Photo: UNDP Malaysia

According to World Urbanization Prospects , Malaysia has 72.8% of its population living in urban areas in 2011. This is expected to increase to 77.9% (higher than the official target of 73.5%) by 2020 with an average urban growth rate of 2.08% between 2015 and 2020. National statistics  show that Peninsular Malaysia is estimated to have an average of 63.1% urban population in 2005, Sabah 53.2% and Sarawak 54.6% with an average rate of growth of 4.93% for the whole of Malaysia between 1991 and 2000.

Urban concentration and increasing density present both opportunities and challenges for human development in the country. On the one hand, urban agglomerations create the synergies of a dynamic innovative ecosystem for economic progress attracting skilled human capital and talent to move to creative, liveable cities. On the other hand, unmanaged urbanization puts an increasing strain on natural resources, threatens quality of life through the emergence of urban blight and widens geographical inequalities between urban and rural areas.

One of the key challenges caused by rapid urbanization to improving the well-being of Malaysians, in particular the bottom 50% of income group (B50), living in urban and peri-urban areas across the country is housing. Urban land markets, housing construction and the provision of urban services have been swamped by the speed of urban growth. With the rapid expansion of cities and increases in the value of land, the lower income groups are often compelled to live in inner-city slums or pushed to the peri-urban areas on the fringes of the cities where residents are more isolated. The central role played by land rights and the provision of secure tenure, particularly in increasing access to improved housing, is increasingly recognized. As a result, the conventional and static emphasis on ownership and individual titling has given way to an understanding of land rights as a continuum with varying degrees of land and housing security.

The lack of an efficient and integrated approach to housing renders many people into a state of homelessness or dilapidated housing conditions. It has a disproportionately huge impact on equity particularly for women, the disabled and the urban poor. Therefore, it is important to recognize housing not only as a social good but as a universal human right. The State should guarantee access to adequate, affordable and quality housing for all its citizens.

What are we hoping to accomplish?

This project is in line with the Country Programme Action Plan (CPAP) 2013-2015 outcome of “developing a new national policy framework to promote inclusive growth and sustainable human development policies and strategies” and for “the bottom 40% of households to receive enhanced access to education, health and social protection programmes and benefit disproportionately from new inclusive growth policies and strategies.” More specifically, it supports CPAP Output 1.6 “The effectiveness of poverty reduction strategies and programs enhanced through better linkage with issues relating to urbanization and environmental sustainability”, where housing is a key component.   

Housing is a complex package of goods and services with many socio-economic implications. As such, it is insufficient to assess housing for the B50 (low income and lower middle income groups) based on “adequacy of supply” alone but to also take stock of the performance of housing using a multidimensional framework taking into consideration socio-economic factors and some of the issues raised above. Given the size of the urban poor population, a major challenge confronting development agencies, policymakers and social actors concerned with addressing poverty is how to provide better access to secure tenure and housing. Tools and strategies to increase the poor’s access to secure land and housing tenure need to be devised.

There is a need to review the institutional processes underpinning the provision of the entire range of housing with a focus on low-, low-medium and medium-cost housing given the new and changing urban and demographic landscape in Malaysia that has resulted in the surge in housing demand causing an unprecedented rise in house prices in the 10MP period as well as to reduce mismatch and improve targeting. While 10MP has an explicit spatial strategy, very little is said about how housing for the B50 fit into the development of the major urban centres and how to integrate social development analysis into spatial plans. For example, the NKEA has a target of moving Greater Kuala Lumpur from 81% of upper middle-cost housing in 2009 to 85% in 2020. A study on housing for the B50 can provide inputs on how housing provision for the B50 can be integrated into spatial plans and regional development plans as well as the larger 10MP spatial agenda instead of causing unwanted gentrification.

A study focusing on B50 housing provide a timely assessment of our national housing approach to further inform the 2-year old NHP’s broad thrusts and policy statements to identify gaps and strengthen linkage of the NHP to broader issues of urban and human development.    

The project will be implemented under a joint programming platform between UNDP and EPU under National Implementation Modality (NIM), where the Government will take ownership of the research process and key findings of the report, thus ensuring sustainability of the project and its relevance to the 11MP. Partnerships with key government ministries, departments and agencies will be developed from the start and throughout the entire research process to establish cross-linkages of programs and initiatives as well as to obtain support in terms of data and information needed for the development of the study.

A series of inputs will be commissioned based on discussion with the core research team to provide more in-depth analytical and technical work related to the topic and also to learn from international best practices on various public housing models. UNDP will leverage on its local and international network of experts in getting the most appropriate researchers and experts for the study.      

Stakeholder consultations will be carried out through planned workshops, peer reviews and other closed-door discussions as and when necessary. To complement the usage of quantitative data, focus group discussions and surveys can be done to obtained qualitative data where needed.

The project commenced on 01 January 2014 and it is currently in the midst of recruiting project personnel – Research Assistants and Researchers for the project.

Who finances it?

Year Donor Amount (USD)
2014-2015 UNDP TRAC $200,000
2014-2015 Government of Malaysia cost-share $318,000

Dealivery in previous fiscal year

Year USD Amount
2014 $247,781.40
2015 $142,530

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