The issue of developers buying low- and low-medium cost housing from other developers to meet their required quota used to be rampant in the open market when Penang was ruled by the BN, a state executive councillor said.

wong hon wai ala wang han wei State urban and rural planning, housing and arts committee chairman Wong Hon Wai ( right ) said this occurred when a developer unable to provide low-cost housing would purchase the quota it needed to fill from those with such units available.

The transactions between developers on such matters were neither "controlled nor monitored" by the state, Wong added.

Furthermore, the Gerakan-led government at that time, failed to gain any contributions from such activities in order to strengthen the state coffers.

However, Wong said, the current Pakatan Rakyat government felt that "quota buying" of low- and low-medium cost housing units needed to be controlled and monitored and at the same time, public interest needed to be protected.

Money collected to go into state coffers

The state is currently imposing a contribution of RM40,000 a unit (for low-cost houses) and RM30,000 (for low-medium-cost) on developers who purchase such units from other developers to meet their quotas, he said.

The money collected from developers would be deposited into the state coffers and used to pay for the construction of affordable housing for the people in the future.

"This is by far higher than the amount fixed by the BN government which, for that matter, did not gain anything previously," he added.

Wong was referring to state Gerakan chief Teng Hock Nan's question on the amount of premium levied on developers who do not provide low-cost houses.

Teng, a former state exco member, queried whether developers were being asked to pay a high premium for not building low-cost houses.

He claimed that the costs incurred from the high premium would eventually be passed on to buyers, resulting in the skyrocketing of property prices.

Teng also admitted that during BN's administration, such developers were only charged a premium of RM8,000 a unit.