‘CAP RENTAL, INSTALMENT AT RM1,400 A MONTH’
This must be considered as the national median household income is RM5,228, says home rental platform CEO
THE government should address the issue of affordable housing in the 2019 Budget by ensuring that the rental or instalment rate for such properties is capped at RM1,400 a month.
This must be considered since the national median household income of Malaysia is RM5,228, and that the recommended housing expenditure amount should not exceed RM1,400.
Home rental platform, Speedrent chief executive officer, Wong Whei Meng, said recent trends by tenants showed that their rental budget was between RM1,400 and RM1,500.
“As for tenants who use the Speedrent platform to find a house for rent, their rental budget is usually between RM1,400 and RM1,500.
“This accounts for about 27 per cent of the median household income of RM5,228.
“If the government intends to build more affordable housing, after deducting the initial payment, the monthly instalment figure should not exceed this level,” he said.
Speedrent is an online platform and smartphone application that connects landlords and tenants to more than 25,000 properties in Malaysia.
Wong said the monthly rental and instalment payment for affordable housing needed to be capped, particularly in the Greater Kuala Lumpur area.
He said most tenants and homebuyers in the Greater Kuala Lumpur area were non-natives of Kuala Lumpur.
“Those who want to rent or buy a house (in Kuala Lumpur) are from outside the Greater Kuala Lumpur area.
“Therefore, the price of affordable housing should be based on the national income level and should be set below RM300,000.
“If families from outside the state want to get a house in Kuala Lumpur, after deducting 10 per cent of the first instalment of the house, they need to borrow RM270,000 from the bank. If the annual interest rate is 4.9 per cent, the monthly instalment amount is about RM1,433,” he said.
These calculations, he said, were based on the latest report released by the Khazanah Research Institute, which also revealed how the household income in Greater Kuala Lumpur was nearly twice the amount of the national average of RM10,427.
Wong said the government’s intention to increase the supply of affordable housing was a good thing, but attention must be given to the location and the methods in buying and selling them.
“If the houses are located in remote areas and public transportation is bad, people will not buy them.
“While this will increase the supply in the market, it will also make the property market worse as no one is interested in buying those properties.
“For houses in the prime locations, they are usually already (sold) out by the time people read about them on websites or newspapers.
“The new government should correct this and implement housing projects in a more transparent manner,” he said.