Thursday, July 27, 2017

Yangon’s not-so affordable housing

Apartments in two pilot affordable housing projects on the outskirts of Yangon look likely to be a bit less affordable than anticipated.

Makeshift housing in Hlaing Tharyar township, Yangon. Many in Myanmar’s largest city urgently need low-cost housing options – a growing problem which the government has so far failed to solve. Photo: Aung Htay Hlaing / The Myanmar Times Makeshift housing in Hlaing Tharyar township, Yangon. Many in Myanmar’s largest city urgently need low-cost housing options – a growing problem which the government has so far failed to solve. Photo: Aung Htay Hlaing / The Myanmar Times

The K100,000 per square foot target for the projects, located in Dagon Seikkan township, has burgeoned to between K120,000 and K130,000, housing officials say.

The final cost of units in the Ayeyarwun and Yadana complexes has not yet been calculated, and will depend on the interest on construction loans, said Daw Moe Thida, deputy director at the Ministry of Construction’s Department of Urban and Housing Development (DUHD), which is overseeing the project.

“We didn’t want it to cost more than K100,000 per square foot, but we estimate that it will probably rise to K120,000 or K130,000,” she said.

This will bring the likely cost of a finished apartment to K60 to K70 million – more than US$50,000.

The two projects combined include 49 buildings of 18 floors each, with a total of 19,600 apartments. More than 30 private companies are involved in construction, which is around 40 percent complete.

The first 6000 apartments, each around 600 square feet, are expected to become available next year. The project, which started in 2013, also includes a school, a hospital, roads, bus lines, sewers and parks.

“Our priority buyers will be people receiving a regular monthly salary,” said Daw Moe Thida, responding to questions from the general secretary of the Association of Real Estate Services at a property seminar hosted in the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) offices on October 10.

“I asked my question because I had heard different prices being quoted,” said general secretary Daw Moh Moh Aung.

The Ministry of Construction says it expects to build 1 million homes in 81 townships nationwide between 2012 and 2031 in order to meet demand.

The DUHD has recently sold apartments in the affordable Shwe Lin Ban housing project in Hlaing Tharyar township for K12 million. Buyers have paid either through installments or advance purchase. Units are smaller – at 324 square feet – and are intended for people working at the Shwe Lin Ban industrial zone.

Negotiations about prices and payment plans for Ayeyarwun and Yadana housing are still going on between the ministry and Construction and Housing Development Bank (CHDB), the bank’s administrative director U Win Zaw told The Myanmar Times on October 10.

CHDB offered Myanmar’s first mortgage-style financing for the Shwe Lin Ban housing project.

“We are still talking about which plan the apartments are to be sold with. In Shwe Lin Ban, we are selling on an installment plan with a 30pc downpayment and the remaining 70pc payable monthly at 12pc interest and 1pc service charge,” he said.

The Ayeyarwun and Yadana projects are seen as a pilot for future public housing developments in Myanmar.

Singaporean company Surbana Jurong signed with the Ministry of Construction in late 2012 to master-plan the developments. The company was formerly part of the Singaporean government, and was responsible for clearing the city-state’s slums and resettling people into affordable, state-build housing.

The company will now work with the DUHD to draw up a master plan for the development of affordable housing in Myanmar.


 Translation by Kyawt Darly Lin