The rent-to-own (RTO) scheme for housing projects up to RM500,000 is expected to roll out across Malaysia by January, State Housing, Local Government and Town and Country Planning committee chairman Jagdeep Singh Deo said today.

Jagdeep (photo) said that he received the information from Finance Minister’s political secretary Tony Pua during a discussion on the RTO scheme.

“This would be a major development because one of the reasons for this RTO scheme was to help overcome the high loan rejection rates for first-time homebuyers,” he said in a press conference in George Town.

He explained the concept of the federal government’s RTO scheme was to use their RM10 billion funding to purchase existing housing units, then rent to first-time homebuyers where they would pay their rent for a certain time period before gaining ownership.

Meanwhile, Jagdeep also urged property developers in Penang with property overhang to opt into the scheme if their unsold properties were priced below RM500,000.

"We can stockpile these housing units from other property developers so that we have the supply to meet the demands (from the first-time home buyers),” he said, adding that the state government has 2,100 existing housing units made available for RTO scheme.

- Bernama