Mass housing project for grassroots in capital 'too expensive'

The two projects will have a total of over 17,000 apartments. 

The government has sought to reduce costs – but with units valued at 20 million kyats (Bt700,000) each, fears have been expressed the majority of people won’t be able to afford the new homes.

“The projects will have no land cost as they will be constructed on 200 acres of state-owned land,” Aye Aye Myint, deputy director of the Department of Human Settlement and Housing Development, said.

“The PAE value was between 1,000 kyats and 1,500 kyats per square feet at Yuzana Housing Project in Dagon Myothit Township, while the PAE value for the two new projects is about 20,000 per square feet,” he said. 

“Moreover, the cost of other infrastructure facilities such as a market, school, amusement park, bus terminals, water supply, electricity, road, meter unit boxes and lifts will be included in the value of apartments, estimated to be about 20 million kyats.”

But the owner of a construction firm said: “People are expecting new apartments to cost not more than 1 million kyats (US$10,000 or Bt350,000) per unit. If the land plots could be bought at 5,000 (kyats) per square feet, the price of apartments would be 10 million kyats.”

He said the private sector could not sell the apartments at the government rate in the long-term.

The value of apartments at the existing low-priced public housing managed by the Department of Human Settlement and Housing Development at the Dagon Myothhit Township in suburban Yangon is from 3 to 8 million kyats, while a private-owned low-priced housing project has homes for about 1.2 million kyats, paid in instalments.

In earlier talks on the projects held in Nay Pyi Taw, the term of repayment was fixed at 30 years, with the instalment calculated at 30 per cent of salary of those who earn 80,000 kyats per month. 

“The term was reduced to 10-15 years and the price of each apartment will not be lower than 8 million kyats,” said Aung Kyaw Oo, director of Department of Human Settlement and Housing Development. Under the new instalment system, monthly payment will be about 100,000 kyats.

But a resident living in Yuzana Housing Project said: “My salary is 200,000 kyats, which is the total living cost of my family. I have to pay 30,000 kyats for apartment rent each month. So, I cannot afford to buy the apartment if we have to pay 100,000 kyats as [a monthly] instalment.” 

The Department of Human Settlement and Housing Development will use 500 billion kyats from the state budget for the construction projects, then transfer them to Yangon Region government for sale to the public.