Malaysia’s Urban Renewal Bill: A Step Towards Modernisation or a Path to Displacement?
After more than a decade of planning, Malaysia’s long-awaited Urban Renewal Bill (URA) is expected to be tabled in Parliament in July 2025. The Bill aims to rejuvenate aging urban areas by restoring vibrancy, providing affordable housing, enhancing public facilities, and modernising architectural landscapes.
However, despite its positive intentions, the Bill has sparked resistance, with some community groups and political figures voicing concerns over potential developer-driven agendas and the risk of gentrification.
Why Does Malaysia Need the Urban Renewal Act (URA)?
Many urban areas in Malaysia were developed during the post-independence property boom. Today, a significant number of these buildings are in a deteriorating state, with redevelopment hindered by legal and logistical challenges.
Key Challenges of Redevelopment:
-
Strata Titles Act 1985: Requires 100% consent from property owners for redevelopment, causing deadlocks.
-
Dilapidated Buildings: Aging infrastructure and outdated facilities hinder urban growth.
-
Economic Vitality: Lack of modern infrastructure reduces property values and stifles economic potential.
The URA aims to break these bottlenecks by lowering the consent threshold for redevelopment. The proposal allows for a majority rule approach, where a certain percentage of property owners’ consent can initiate redevelopment, especially in dilapidated areas.
Controversies and Public Concerns
While the URA’s objectives are clear, there are concerns that it may disproportionately benefit developers, potentially leading to forced evictions and loss of community identity.
1. Developer-Driven Approach
Professor Shuhana Shamsuddin from Taylor’s University criticized the URA for appearing to prioritize developers rather than communities. She argued that instead of putting developers at the forefront, the government should establish an independent agency to oversee urban renewal.
2. Risk of Gentrification
Urban renewal can result in the displacement of lower-income communities, as seen in Kampung Baru, where traditional neighbourhoods have been replaced by high-rises, pricing out original residents.
3. Property Tax Concerns
Even when redeveloped, the new housing units might lead to higher property taxes, making it unaffordable for previous residents to continue living there. Professor Jamalunlaili Abdullah from Universiti Teknologi MARA emphasized the importance of long-term affordability guarantees, particularly for low-income property owners.
4. Community Backlash
PAS Youth has planned a protest on June 14 in the Klang Valley to voice opposition to the URA, arguing that it opens the door to exploitation by developers and endangers vulnerable communities.
Proposed Safeguards to Address Concerns
Despite resistance, proponents of the URA, including Prime Minister Datuk Seri Anwar Ibrahim, argue that the Bill will protect property owners’ rights through:
-
Fair Compensation: Ensuring significantly higher payouts than existing compensation laws.
-
Rights Protection: Aimed particularly at urban Malays and the economically vulnerable, safeguarding their ability to continue living in redeveloped areas.
-
Legal Compliance: Redevelopment projects must align with local zoning laws and development guidelines to prevent misuse of the Act.
Majority Rule Principle:
Currently, even a small minority (10%) can block redevelopment despite overwhelming support (90%) from the rest. The URA proposes a more balanced approach, allowing redevelopment to proceed if the majority consents, particularly in dilapidated zones.
What Urban Renewal Could Mean for Property Markets
If implemented, the URA could significantly boost property values and transform older urban areas into vibrant communities. However, there are potential risks to be managed, particularly regarding:
-
Displacement: Ensuring that long-time residents are not pushed out.
-
Social Inequality: Redevelopment should not solely cater to the affluent.
-
Economic Integration: Balancing modernisation with preserving cultural heritage.
Potential Benefits:
-
Increased Property Values: Modern infrastructure can elevate surrounding real estate prices.
-
Economic Revitalisation: New commercial spaces attract businesses and tourism.
-
Better Living Standards: Upgraded housing and public facilities enhance quality of life.
Case Study: Kampung Sungai Baru
Kampung Sungai Baru in Kuala Lumpur is often cited as an example where urban renewal has led to loss of community identity. Residents fear that redevelopment could lead to high-rise condos replacing heritage areas, highlighting the need for a more community-centric approach.
Best Practices from Other Countries:
-
Singapore’s HDB Upgrading Programme: Balances renewal with preserving community spaces.
-
Japan’s Urban Regeneration Law: Emphasizes local government control, reducing developer dominance.
-
South Korea’s Urban Renewal Policies: Focus on public participation and affordability.
Balancing Modernisation with Social Equity
The Urban Renewal Bill could bring much-needed infrastructure upgrades, but the government must strike a balance between development and social justice. Measures should include:
-
Community Consultation: Regular engagement with residents before project approval.
-
Affordability Assurance: Mechanisms to keep property taxes manageable post-redevelopment.
-
Cultural Preservation: Maintaining the character and identity of older neighbourhoods.
Looking Ahead:
If executed with transparency and fairness, the URA could transform aging urban areas while safeguarding the rights and lifestyles of existing residents. To achieve this, the government must ensure that the voices of affected communities are not overlooked.
Conclusion: A Crucial But Contentious Move
Malaysia’s Urban Renewal Bill represents a significant step towards revitalising cities but also poses challenges related to gentrification and property rights. As Parliament debates the Bill in July, it is crucial to address community concerns and ensure that redevelopment projects truly benefit the people rather than merely serving developer interests.
By implementing clear guidelines and protective measures, Malaysia can rejuvenate its cities while maintaining social equity and cultural heritage. Stay tuned for more updates as the Bill progresses through the legislative process.
