Housing has always been a hot issue in Malaysia and now two ideas are being pushed under the 13th Malaysia Plan (13MP): build-then-sell (BTS) and rent-to-own (RTO). On paper, they sound like a fix for affordability. But are they really? Let’s look at the bad and the good.
Build-then-sell could actually make homes more expensive. Developers need to pay the full construction cost upfront before selling. That extra risk and financing cost will almost certainly be passed on to buyers, making new houses at least 20% pricier.
We’ve seen this happen overseas. In Australia and the UK, where BTS is more common, property prices have stayed severely unaffordable. On top of that, small and medium developers may be squeezed out of the market because they can’t carry the risk. Less competition means fewer choices — and higher prices in the long run.
Rent-to-own also comes with limitations. In practice, many developers have only offered unsold or less popular units for RTO schemes. The good homes in prime locations are still snapped up by cash buyers and investors, leaving RTO buyers with limited, leftover options.
Still, there are upsides if these schemes are properly designed.
RTO helps Malaysians who can’t qualify for a bank loan today. It lets you rent first, buy later, giving you time to save more, stabilise your income, and improve your credit rating. You also get to live in the house before deciding to commit fully.
BTS offers more protection to buyers. Since you only pay when the home is finished, you know exactly what you’re getting. It lowers the risk of abandoned projects and pushes developers to build better-quality homes. It also discourages speculative flipping, which helps cool down runaway property prices.
With the right government backing and financing support, both BTS and RTO could still open new doors for Malaysians trying to own a home.
BTS and RTO are double-edged swords. They can make owning a home safer and more accessible or they could push prices up and limit choices.
As these policies roll out, Malaysians need to stay alert, understand the risks, and read every contract carefully. Because when it comes to housing, the fine print matters as much as the big promises.
