Malaysians can no longer afford to buy new houses

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    Jun Nong Hu
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    Kuala Lumpur (April 2): As we can see, inflation is one critical issue that strikes Malaysia right off the bat, leaving their consumer vulnerable to affordability, causing market discrepancy.

    Property developers were to be blamed for jacking house prices in their favour, planning projects without sufficient knowledge of consumer’s needs. The overbuilt high end properties are not suitable for the salary brackets of most Malaysians, especially fresh graduate and unskilled workers. (2013-2017: only 16.69% wage increase, with 27.32% housing price increase)

    The central bank’s 2017 annual report also found out that the bottom 40% of households by income only grew from RM2,537 to RM2,848, about a RM150 increase annually between 2014 and 2016.

    BNM’s report which estimates living wage for a single adult in KL would be RM2,700, a couple without child (RM4,500) and a couple with two children (RM6,500)

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    Statements made by REHDA:
    The underwhelming salary over the years is the reason why many are deprived of owning a house, said a national association for developers.

    REHDA that represents the interests of many property developers mentioned the needs to point out key fundamentals related to housing unaffordability.

    “It is important to look at the structural issues related to the country’s economy”, says Datuk Seri Fateh Iskandar Mohamed Mansor, REHDA president.

    It is estimated that the maximum affordable price for a house in Malaysia is RM282,000 from our current salary levels. But the World Bank stated that Malaysia offers cheap price on property, and is one of the affordable places to own a home. So, we have two conflicting views, the related fact went back to our salary increase rate being too low.

    According to the masterclass book distributed by Rehda, it appears that houses in Kuala Lumpur (KL), PJ, Johor Baru and Georgetown are the “most unaffordable” in comparison to the average household income levels due to the pricing up jacking in urban areas and key employment centres.

    The masterclass handbook from Rehda state that unsold housing units reached 129,052 as at September 2017. More than 80% of the unsold units are priced at RM250,000 and above.

    Authorities in charge were suggesting more efforts on building units for rental to resolve the house affordability issue.

    But on top of that, the country can’t just rely on giving help to resolve issues, as the main issue were never to be solved in this manner. The main issue with unaffordability were to be blamed on Malaysia ‘s economy slowdown, hopefully Malaysia can politically and economically solve this issue to let the lower income employees get sufficient raise in income and see the lights in their future.

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