Private real estate developers are selling cheaper homes than those offered by the government's 1Malaysia People's Housing Programme (PR1MA), according to Savills Malaysia.

In fact, major home builders like Sunway, SP Setia and Mah Sing Group as well as non-listed property firms are now focusing on the affordable residential segment amidst the sluggish property market.

"PR1MA's competitors are also offering unit specifications that are deemed more attractive to buyers and are more strategically located" said Savills' Research and Consultancy Director Amy Wong.

Although there are PR1MA projects in all Malaysian states and the dwellings they offer are priced "affordable” at below RM500,000, their specification and locations are sometimes not appealing to buyers.

"PR1MA units that are located in states such as Kedah, for example, are competing against a landed-driven market. Buyers, there have a choice to acquire a landed home at a good price compared to a strata unit" she said.

On the other hand, PR1MA developments in Klang Valley, Penang and Johor see healthier demand versus those in secluded areas.

According to Knight Frank Malaysia Managing Director Sarkunan Subramaniam, many completed and ongoing PR1MA developments are situated in unattractive locations.

"In my opinion, I believe PR1MA does not fulfil buyers' wants and needs, particularly for first-time homeowners.” Hence, he is calling on the authorities to look into the social housing scheme to improve it, so PR1MA can accomplish its goal of providing low-cost housing to Malaysians.

Echoing a similar sentiment is Savills Deputy Executive Chairman Allan Soo. "Better quality products can only be made available in the market if both federal and state governments were to step up and take a more proactive stand on this issue" he added.

Based on the latest available data, PR1MA has built a total of 16,250 homes across the country. Although 1.5 million people have applied to buy a home via this programme, many backed out after failing to obtain mortgages from financial institutions.