Purchasing a new property development is an everyone dream list, imagine owning your own house and you don’t have to worry about anything. However, developers in Malaysia doesn’t see much improvement in the property market recently.
Why? Not everyone can afford to purchase property for investment in Malaysia, the affordability of housing in Kuala Lumpur has dropped significantly compared to before. The central bank of Malaysia response to citizens stating that they need more loan to spur on the house, housing is not affordable.
A website creates by the national bank shows the myth that access to financing was deterring home ownership and showing that loan approvals for the housing of Malaysia citizens are more than 70%, as per to MahSing share price.
The housing prices have been rising non-stop, although the economy doesn’t go well. The grievances of Malaysians grappling with the cost of living are getting louder and louder.
According to research in the past, the median house price in Malaysia was four times higher than the annual household income, making it unaffordable compare to other countries. With that being said, it is not always because the house is too expensive. The lack of income is why many property developers in Malaysia are unable to own their property.
Approximately 73% of unsold properties in Malaysia are priced unreasonable, according to the national bank institute. Malaysians are also tested and considered severely unaffordable when government balance it with international standards.
The transparency of the top property developer in Malaysia has to be made transparent contribute by the government. One of the false accuse include bank Negara has introduced stricter financing rules to curb speculation.
There is also a shortage of approximately one million units of affordable housing in Malaysia citizens as well. Most property developers and related associates forecast that the market will still be low and passive.
The lack of awareness of the home loan application process is also one of the issues among prospective Malaysian homebuyers, especially the first-time home buyers in Malaysia. Hence it has caused about 80% of rejections in a loan application. This is also because the top property projects in Malaysia is being priced three times higher than the income of the applicant.
Other reasons include weak credit score, lack of capabilities to repay back the home mortgage loan in Malaysia, bank appetite and applicants’ other financial commitment. Hence, efforts need to be invested in educating Malaysians on the criteria and steps on how to secure a home loan successfully.
What can be lengthened as a conclusion is that most Malaysians can choose as an alternative to own a property? Some of the significant factors that may affect you to opt for to buy a new house include the payments and build equity, the income tax deductible, savings and stability.
On the other hand, renting allows cheaper payment every month, the maintenance is held responsible by the owner, there is no down payment that requires you to pay. Moreover, those who prefer to move around can switch easily.
Buying your own property in the industrial area could cost you a lot. As it is a long-term commitment, it requires you to be responsible for things such as loan repayment. What is more worrying is that the value of the property may go down in a rare case.
What is the disadvantage of renting? The rents will be rising over time, so the cost of living will rise again. People who rent the property has no wealth creation as well.