Via The Malaysian Insider:
I'm slightly worried -- the information offered in this article is far from accurate, which makes me wonder how accurate data collected by government or government-related agencies are concerning our economy.
The first thing that threw me off was the number given for the average salary of a graduate. Unless this person is calculating people who end up working as consultants for Khazanah and get paid in USD, there is no way the average fresh grad is earning RM 3000 to RM 4000 every month. Even if you calculate a fairly stable increase of income in the next few years, most graduates would just only reach the RM 3000 mark after several years of working.
Although the average value of homes is between RM 200,000 to RM 250,000, this is far from the prices of average homes in middle to upper-middle income locations in the Klang Valley. There are no good houses that can be acquired at this price, unless you count very distant development areas along the city outskirts. The average price for a fairly decent home, actually, is RM 250,000 to RM 300,000 -- even if you buy straight from the developer. So this number probably includes the vast number of lower middle income flats and apartments -- which can easily offer up to several hundred to a thousand units for every housing estate that can offer twenty -- or homes outside of the Klang Valley, where, unless you count cities like Penang and the Johor areas which are close to Singapore, don't really have a very robust real estate outlook.
Should I purchase a home quickly, even if it may not be perfect, or should I just hang around with my current apartment and pay the rent every month?
House prices up 20% in 2010?
KUALA LUMPUR, Dec 17 — House hunters will likely face higher prices next year as pent up demand and gains from the stock market boost the property sector.
Houses on the secondary market could also be hit by an additional five per cent increase in prices as owners looking to sell try to cover the real property gains tax (RPGT) which comes into effect in January.
According to the Real Estate and Housing Developer’s Association (Rehda), slightly over half the respondents in a survey of its members expect property prices to increase up to 20 per cent over the next six months.
About 30 per cent of the respondents expect prices to remain stable, while less than five per cent expect prices to decrease.
The stock market has made substantial gains this year and investors who benefitted will likely be looking to put their money in property.
“Six to nine months after the stock market increases, it goes into brick and mortar,” said Rehda deputy president Datuk Michael Yam at a briefing today on the property outlook for next year.
On the positive side, interest rates remain low and banks continue to be flush with extra funds, therefore making the arrangement of home financing easier.
Yam, however, stressed that there was still a relatively low barrier to home ownership in Malaysia and ticked off a list of factors in the homebuyer’s favour, including interest rates as low as BLR (base lending rate) minus 2.3 per cent; margins of financing up to 100 per cent; zero lock in period; stamp duty exemptions; and repayment periods extended to thirty years or up to the age of 75.
“Even I can qualify for a (30 year) loan now,” he quipped.
According to Rehda officials at the press conference, the average value of homes transacted in 2009 is estimated to be between RM200,000 and RM250,000 when excluding low cost homes, and about RM168,000 when taking into account low cost houses.
Fresh graduates, however, could face difficulty buying properties in the city where prices are much higher.
Yam said that there were no official figures available for the average price of link homes in the Klang Valley but said that there were terrace houses in some suburbs available for about RM400,000, as compared with RM200,000 in smaller towns and cities like Kluang and Kuantan.
“Graduates may have a problem without help from their parents,” he said.
“They earn maybe RM3,000 to RM4,000 a month, which means they can borrow only RM150,000 to RM200,000. It is not possible to buy a terrace house [with that level of income] but maybe an apartment.”
He added that developers might have to consider building smaller units for the fresh graduate market segment, in the region of 600 sq ft apartments that sell for RM300 per sq ft.
A long term boom is also expected for the housing industry that could put upward pressure on prices as Yam said that slightly over half of the population is below 24 years of age and would later enter the homebuyers market.
“These people will be pushing to enter the property market,” said Yam.
Housing prices in some parts of the world such as China, Singapore, Hong Kong and Australia have risen dramatically over the two years, prompting a public outcry.
Prices of private homes in Singapore reportedly rose by 16 per cent in the third quarter and there are concerns of a speculative asset bubble building in Hong Kong.
According to Ratings Agency Malaysia economist Kristina Fong, asset bubbles were not evident in Malaysia and an over-supply of units on the Malaysian property market is likely to cap price escalation.
I'm slightly worried -- the information offered in this article is far from accurate, which makes me wonder how accurate data collected by government or government-related agencies are concerning our economy.
The first thing that threw me off was the number given for the average salary of a graduate. Unless this person is calculating people who end up working as consultants for Khazanah and get paid in USD, there is no way the average fresh grad is earning RM 3000 to RM 4000 every month. Even if you calculate a fairly stable increase of income in the next few years, most graduates would just only reach the RM 3000 mark after several years of working.
Although the average value of homes is between RM 200,000 to RM 250,000, this is far from the prices of average homes in middle to upper-middle income locations in the Klang Valley. There are no good houses that can be acquired at this price, unless you count very distant development areas along the city outskirts. The average price for a fairly decent home, actually, is RM 250,000 to RM 300,000 -- even if you buy straight from the developer. So this number probably includes the vast number of lower middle income flats and apartments -- which can easily offer up to several hundred to a thousand units for every housing estate that can offer twenty -- or homes outside of the Klang Valley, where, unless you count cities like Penang and the Johor areas which are close to Singapore, don't really have a very robust real estate outlook.
Should I purchase a home quickly, even if it may not be perfect, or should I just hang around with my current apartment and pay the rent every month?
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