KRI Webinar - Rich Places, Poor Places: Managing the realities of neighbourhoods

On 24 Aug 2023, KRI hosted a webinar outlining findings from the recently published report, ‘Residential Settlements and Spatial Inequality: A study of Greater Kuala Lumpur Neighbourhoods’. The webinar explored how prosperous neighbourhoods are distinguished by their levels of place differentiation – a reflection of the diverse freedoms and opportunities they offer to residents. The discourse also included housing as the pivotal anchor that shapes the lives of households.

The panel consisted of the authors of the report, Sr Dr Suraya Ismail, Gregory Ho Wai Son, Adam Manaf Mohamed Firouz, Theebalakshmi Kunasekaran and moderated by Puteri Marjan Megat Muzafar. The panels discussed Greater Kuala Lumpur's (GKL) prosperity driven by agglomeration economies, fostering innovation and resource sharing, yet it also underlined how this dynamic contributes to socio-spatial inequality among neighbourhoods by exploring place differentiation as well as the polarised housing markets.  

GKL thrives due to agglomeration economy

Greater Kuala Lumpur benefits from the agglomeration economy—a phenomenon where increased proximity between individuals, businesses, and institutions fosters rapid economic development. This closely knit ecosystem encourages innovation, resource sharing, and knowledge exchange, collectively improving the quality of life in the region. However, the dynamics of agglomeration economies do not always correspond to the socio-dynamics of what makes neighbourhoods desirable places to live in.

Place differentiation in GKL’s neighbourhoods

Place Differentiation encapsulates the essence of our daily experiences – such as the availability of essential services, the vibrancy of leisure options, the accessibility of mobility hubs. In prosperous neighbourhoods of Greater Kuala Lumpur, this differentiation is especially prominent, providing residents with access to better educational facilities, healthcare, and employment opportunities. However, it can also create a socio-spatial divide, contributing to a growing sense of inequality among neighbourhoods.

Housing dynamics in GKL

Housing is another defining feature of prosperous neighbourhoods and cities. However, the GKL housing market faces an overhang and unaffordability issue. The Hedonic Price Model confirms that house size and location come at a premium. Usable space in particular is valued by homebuyers, rather than just the number of rooms. However, many transacted units at affordable to the median income are smaller than the national standard. Moreover, proximity to private low-cost housing is negatively correlated with nearby house prices, alluding to their deteriorating conditions and maintenance challenges, while the same is not found for government low-cost housing. The policy implications point to the need for higher housing standards, while also revisiting the low-cost housing quota imposed on developers.

The discussion also delved into the challenges faced by social housing tenants in graduating from programs like PPR. Findings from a recent KRI report revealed that prospective graduates have limited affordable rental choices and are often restricted to smaller, substandard housing units. To address this, policy recommendations include refining eligibility criteria, offering housing allowances, implementing the Rental Tenancy Act, promoting integrated housing, and better managing private housing stock, all aimed at improving housing options and conditions for a smoother transition out of social housing.

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