Housing Income Index: RM14,500 income to buy house in Klang Valley

/* February 18th, 2014 by poobalan | View blog reactions No comments »
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The Star frontpaged an interesting article today. How much should a family earn in order to afford a house in Klang Valley? A question that we all wonder about. Well, according to a survey done by Sime Darby Property Bhd in collaboration with the Faculty of Built Environment of Universiti Malaya, its….RM14,580!

The survey covered 1,529 respondents, of whom 1,183 were home owners at 12 locations: Bukit Jelutong, Denai Alam, Bukit Subang, Bandar Bukit Raja, Subang Jaya, USJ, Putra Heights, Ara Damansara, Mont Kiara, Melawati, Kajang and Nilai. I suppose the balance 346 respondents were (i) renting, (ii) not from those areas, or (iii) refused to divulge house ownership info.

Wonder why areas like Puchong, Cheras, Dengkil, Banting, Kapar, Putrajaya, Cyberjaya, Semenyih, Serdang, Klang, Shah Alam, Sg Buloh, Rawang etc not covered. Hope they conduct a second round of survey to cover these areas.

Average household income

Average household income

[image from The Star] [click on image to view larger size]

Some analysis of the respondents: 94% are married. 73% are male. 59% work in private sector; 20% are self-employed, and 14% work in government. No mention if the income is from both spouse or single spouse.

13% have post-grad qualifications, 40% have bachelor degree, and 21% have a diploma. 68% are Malay/bumiputra; 30% Chinese and just 2% Indians.  Looks like not many Indians live in these places. And seems like the affluent Malays/bumiputera are quite alot.

Quite importantly, the age group of respondents is missing. Show this info to any adult below age 30 and see if they fit into this income group. If the respondents are into their late 30s  or more, then the young adults can’t even think about buying houses in these places. 10-15 years down the lane, how would it be? As it is, our parents could afford to buy house in these locations when they were young. Read another article in the Star where Mr Gill (age 63) bought house in SS12 Subang Jaya way back in 1985 (age 34) for RM200k that took quarter of his combined income with wife. Now at age 34, what can you buy?

It will interesting to also identify the household size of the respondents. Does the average income consider the household size (kids, maid, parents, siblings etc)?

The other part of the survey covered their expenditure information. So, 12% of income goes into savings, translating into RM1749.60 on average.  How many percent can the rest of us save? Transportation is 16% (Rm2,332.80), Food 15% (RM2,187), mortgage 14% (RM2,041.20), another 15% for other loans (RM2,187), 13% for other expenses (Rm1,895.40), childcare/education 7% (RM1,020.60) and insurance 6% (RM874.80). Most likely these houses have two or more cars. How is your expenses like?

Ok, let’s look some other statistics from DOS and EPU which both refer to Household Income Survey (last done in 2012). All stats below refer to Klang Valley and/or urban figures wherever possible:

  • The top 20% of urban dwellers earned a monthly average of RM13,654 while the middle 40% earned average of RM5,294. Don’t bother looking at the bottom 40%, middle 40% already can’t own house in those 12 places (and I suspect many other places) even with double income).
  • 41% of urban dwellers earn RM5,000 or more.
  • The average monthly income for urban dweller is RM5,742. Selangor residents earned RM7,023 while KL residents RM8,586.

Looking at HIS statistics, using average salary earned by those staying in Selangor or KL and double it (both spouse working), then you can buy house in those areas. However taking into account that 41% earn more than RM5,000 and that the top 20% earn average of RM13.6k, then we are looking at a small pool of between 20-40% of people affording to buy houses.

The survey covers affluent areas, and I suspect its to plan for building more affordable homes for the those households who can afford to earn nearly triple the national average income.

BTW, looks like I can’t afford a house in Klang Valley if want to buy now.

Below is the article from the Star:

You must have an average household income of RM14,580 a month to afford a home in the Klang Valley, according to a recent study.

The study – spearheaded by Sime Darby Property Bhd in collaboration with the Faculty of Built Environment of Universiti Malaya – takes into account the current household spending trend, price of homes and mortgage rates.

It found that certain groups of buyers interested in strategic areas can have access to houses that are priced at 56 times their household income.

The study also found that this same group can afford to spend up to 26% of their monthly household income to service a mortgage.

It identified strategic areas in the Klang Valley that are considered not only accessible but have the potential to appreciate in value. They include Nilai, Denai Alam, Bukit Jelutong and Bukit Subang.

A report of the study said that houses in selected areas in the Klang Valley remain accessible to homeowners who may be looking to invest in a second home.

The Housing-Income Index which was launched here yesterday by Urban Wellbeing, Housing and Local Government Minister Datuk Abdul Rahman Dahlan, who said the survey results would be useful for potential house buyers.

“The Index and its key findings had been reviewed by the ministry, and we find that the information is valuable as it can help policy makers and developers work hand-in-hand to build more houses that are not only accessible. but which can appreciate in value,” he said.

Abdul Rahman hoped that other property developers and the academia can carry out similar surveys in the country.

Based on the findings, Sime Darby said that 68% ofplanned housing schemes in the Klang Valley were in the accessible range.

“We intend to utilise the results to develop innovative, high quality products that are accessible and meet market needs,” said Sime darby Property managing director Datuk Seri Abd Wahab Maskan.

Household Expenditure
[image from The Star]

The Housing-Income Index was developed to gain a better understanding of home-owner profiles, specifically household incomes and spending patterns in relation to owning a home.

The study covered 1,529 respondents, of whom 1,183 were home owners at 12 locations: Bukit Jelutong, Denai Alam, Bukit Subang, Bandar Bukit Raja, Subang Jaya, USJ, Putra Heights, Ara Damansara, Mont Kiara, Melawati, Kajang and Nilai.

source: http://www.thestar.com.my/News/Nation/2014/02/18/Klang-Valley-still-affordable-A-household-needs-monthly-income-of-RM14580-to-buy-a-home/

MCA says new housing estates should reserve land for all types of schools

/* February 17th, 2014 by poobalan | View blog reactions No comments »
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A call which is very long overdue (or maybe repeated often silently), but in many ways – worthless.  It will be a miracle if land is allocated for such schools in new housing areas or made part of condition for developers to develop housing projects, due to economic, social and political reasons. It goes against the national education policy it seems to build more vernacular schools. Flimsy reasons are given, when asked about secondary vernacular school, such as “increase enrollment in primary school first” [coming up in next blog post].

I think any housing development project must allocate land for primary and secondary schools [if can allocate land for private or international schools, don’t tell me can’t do it for national type schools!!!], places of worship (at least 5 different religion/denominations), community hall, nursery/kindergarten, daycare center, police beat, sports field,  one or two row of shoplots, among others.

As I said, all these noise is from the proverbial empty vessels. We all know the power lies in whose hands.

MCA has called on the government to reserve land for all types of schools, including vernacular schools, at new housing estates.

MCA president Datuk Seri Liow Tiong Lai said the education department must be proactive in its planning for schools.

“The education officers must identify the locations and reserve the land for Chinese schools before the people ask for it,” he said after visiting the newly opened SJKC Kheng Chee, which has been relocated from Pahang in the morning.

Liow added that currently there are only reserved lands for the national schools.

He said MCA would continue to monitor the implementation of the Education Blueprint to ensure the continuous development of Chinese education since the government had recognised it as part of the mainstream education system.

source: http://www.thestar.com.my/News/Nation/2014/02/17/Liow-says-reserve-land-for-all-types-of-schools/

Welcome 2014!

/* December 31st, 2013 by poobalan | View blog reactions No comments »
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Happy New Year Folks! Wishing everyone a great year ahead.

Its Visit Malaysia 2014 so let’s put up our best for our visitors.

Times are going to be hard so…

Tight belts

 

[image credit: http://andreasjenk.wordpress.com/2011/08/06/tightening-our-belts/]

Marriage and Divorce statistics in Malaysia 2008-2012

/* December 11th, 2013 by poobalan | View blog reactions 1 comment »
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Some stats on marriages between 2008 and 2012 (5 years period) in Malaysia:

Marriages: 1.2mil (estimated) Muslim marriages (if total up the figures from all the states, its 908,489 marriages only. Not sure how 1.2mil was derived) and 329,209 non-Muslim marriages. 21.5% of marriages are non-Muslims.

Divorces: 210,326 Muslims and 42,507 non-Muslims. 16.8% of divorces are non-Muslims cases. Divorce rate is 17.5% for Muslims and 12.9% for non-Muslims.

It would be interesting to see the marriage and divorce trends over the same period. Wonder if marriage rate is dropping while divorce rate is rising.

Obviously, one wonders why need to have this statistics divided by religion, in the first place.

About 1.2 million Muslim marriages were registered in the country between 2008 and 2012, the Dewan Negara was told.

Minister in the Prime Minister’s Department Datuk Seri Jamil Khir Baharom said the highest number was registered in Kedah, at 115,288, followed by Kelantan (108,675), Selangor (108,104), Johor (106,503) and Perak (80,880).

Sabah, he said, recorded 71,642), while Pahang had 69,647, Terengganu (66,427), Sara­wak (39,568), Kuala Lumpur (34,744), Negri Sembilan (33,717), Penang (29,196), Malacca (27,095), Perlis (13,408), Labuan (3,142) and Putrajaya (453).

Jamil Khir was replying to a question raised by Senator Datuk Dr Mashitah Ibrahim who wanted to know the number of marriages and divorces in all communities.

He said 210,326 Muslim divorces were recorded over the same period, with Selangor topping the list with 28,570 cases, followed by Johor (17,075), Kedah (16,315), Kelantan (15,489), Pahang (12,552), Perak (12,309), Terengganu (10,918), Kuala Lumpur (10,690), Sabah (8,758), Sarawak (7,566), Negri Sembilan (7,279), Penang (6,968), Malacca (6,043), Perlis (2,864), Labuan (639) and Putrajaya (164).

The state Islamic affairs departments and the syariah courts undertook the registration of Muslim marriages and divorces, he said.

Jamil Khir said 329,209 non-Muslim marriages were registered during the same period. He also said that 42,507 cases of divorce were concluded in the courts. — Bernama

source: http://www.thestar.com.my/News/Nation/2013/12/11/Jamil-Khir-12-million-Muslim-marriages-between-2008-and-2012.aspx

useful websites for kids

/* December 4th, 2013 by poobalan | View blog reactions No comments »
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The following slides are the ones displayed during the Vizuthugal interview session last week. Reproduced here for reference since it has many urls and was displayed briefly only.

Hope it helps parents to set some activities for their kids during school holidays.

There are many more websites for educational purposes, so do explore.

Still working on getting a copy of the interview session. Hope can put it on youtube soon.

 

Website for Kids - Slide1

Website for Kids – Slide1

 

Website for Kids - Slide2

Website for Kids – Slide2

 

Website for Kids - Slide3

Website for Kids – Slide3

 

Website for Kids - Slide4

Website for Kids – Slide4