As Government planning and policy greatly influence the state of Malaysian housing industry, a proactive Government should always be mindful of its citizens’ needs for house ownership. However, meeting the Government’s housing targets requires full support from the private sector, because no Government in the world can provide housing to all of its citizens on its own. Therefore, collaboration between the Government and private sector is crucial, where both parties need to work together in order to maintain the housing industry on the right track. It is unfortunate that the issue of unsold residential properties has plagued Malaysia’s housing industry for a long time – a problem that has not seen any sign of decline from year to year. The unsold properties' problem is complicated by the issue of Bumiputera (Indigenous) lots - lots that can only be sold or leased to Bumiputeras, namely Malays, the Indigenous people, Sabahans and Sarawakians. The State of Kedah, located in the northern part of Malaysia, is not spared from facing this issue, where the number of unsold houses are high. This study analyses the issue of unsold residential properties on Bumiputera lots in the state of Kedah, with the aim of finding the best solution to the problem. In order to achieve the objective, this study employs institutional economics analysis that is based on formal institutions or formal written rules. In other words, the study is based on institutional perspectives whereby the underpinning approaches can be analysed from formal and informal rules. The Elite Group Interview technique was used for data collection in three districts namely Kuala Muda, Baling and Kulim. These districts were selected due to the high volume of unsold residential properties. Eight respondents who had more than 25 years of experience in the property industry participated in this study. The data collected was analysed based on four (4) themes, comprising laws, rent-to-own, reducing house prices, and taxes on vacant houses. Finally, since the data collected were qualitative data, the finding was explained descriptively. The finding showed that institutional perspectives can be applied in property research for identifying alternatives to overcome unsold residential properties in Kedah. It also reveals that the rent-to-own method was the agreed best solution for this issue. By adopting this method, the government can prevent the release of Bumiputera lots and maintain the quota for land ownership among indigenous people.
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