Housing supply model of the Federal Territory Kuala Lumpur / Noryanto Asroun Mohamad Asroun

Sharp house prices increase in Malaysia are not a new issue. House prices in Malaysia rose high since 2009 and recorded the highest record in 2013 (Chee Yin et al., 2017). It has affected the affordability of younger households or first-time home buyers. The government has embarked on various policies and strategies to improve the affordability of low and middle-income home buyers. However, the current strategies taken by the government seem not effective to improve the affordability among home buyers (Kamal et al., 2015). Due to the issue, many discussions have grown around the globe to identify the price elasticity of supply of respective locations. Empirical studies involving the housing supply model in Malaysia remain understudies. Thus, the study aims to recommend a housing supply model of the Federal Territory Kuala Lumpur (FTKL). Therefore, this study has measured the price elasticity of housing supply and evaluated the effect of house price, construction cost, and a few government-driven factors such as interest rate, construction permit procedure, and construction permit time on housing supply at the local level, in the context of the FTKL.