Posts Tagged ‘Housing’

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

February 18th, 2014
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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
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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/

My take on housing woes

October 17th, 2013
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This is some sort of a record. My last posting was on 30th August! Plenty of things I want to write about, but lack time for proper research and writing. End up tweeting those issues I wanted to blog about.

Anyway, I was responding to a posting in FB which stated “So HK and singapore house prices to come down by 20%. Malaysia how?”  and thought why not collect those responses and blog it. Basically, what I think should be done to curb prices. Apologies for the informal language.

in my taman which is abt 13 yrs old, the new phase being constructed which is 2.5 storey is frm 800k to 2.2mil. The land was bought so long ago. Building material n construction quality is average even though this company is top 20 in malaysia. First phase years ago was 140k. So what justifies the price? Labor? Material? Advertising? Value added stuff?

Govt is being too soft. Should review pricing structure. If developers threaten no prob, can take over projects. Deny license for houses that are too big. Why need 24*80 3 storey house when most families are getting smaller? Just for once in a while relatives visit? 20*70 or 22*75 is ok already.

Labors are moved around from project to project as well. Cost is the spread among projects.

House price should be on land purchase price, not land current price.

Limit an individual to own 3 house max.

Foreigners limit to 10% of any house project and house price min 1mil.

House below 5 yrs not allowed to be sold unless owner pass away or migrate or ill etc.

Stop building houses in hard to reach places for low income group. They r the ones who need public transport. Let bungalows or high condo be built in outskirts.

Houses in city area must not be cost more than affordable monthly repayment amount of 1/3 of salary of average msian.

 

Yes, construction and housing is one of the backbone of country development. But if things that are being developed is of little benefit, then no point developing them. We can’t wait for the “trickle down” effect to benefit the rest.

Treated water after 70 year wait for estate folks

October 11th, 2012
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Good news indeed. It seems after talking to the estate management in recent times, the state has been able to proceed with laying pipes and providing treated water to the families living in the estate. Not sure why the engagement never happened before.

 

FORTY-SIX families living in Ulu Sawah Estate in Rantau near Seremban have expressed gratitude to the state administration for providing treated water by Syarikat Air Negri Sembilan (SAINS) supplied to their homes, thus ending a seven-decade wait for clean water.

The families, who had been relying on processed river water provided by the management all these while for all their necessities, said they would no longer have to worry about water disruptions, particularly during the prolonged dry weather.

P. Gemini Dass, 48, who has been living in the estate for the past four decades, thanked Mentri Besar Datuk Seri Mohamad Hasan for keeping his promise to provide the estate folks with a consistent supply of treated water.

Overjoyed: Ulu Sawah estate folk expressing their gratitude to Mohamad for keeping his promise to provide treated water by Syarikat Air Negri Sembilan to their homes.
Overjoyed: Ulu Sawah estate folk expressing their gratitude to Mohamad for keeping his promise to provide treated water by Syarikat Air Negri Sembilan to their homes.

“Although we are located so close to Seremban, we never had access to treated water supply as we were located inside the estate. Today, we will be assured that our taps won’t run dry irrespective of the time of the day,” said the father of three.

Housewife A. Kamalam 56, was also lost for words when she saw lorries unloading huge pipes to be laid in the estate.

“My eight children will no longer have to worry if there is enough water for them to take their showers or do other chores,” said Kamalam.

Kg Kuala Sawah Village Development and Security committee chairman Ab Mutalib Sulaiman, 47, said there had been occasions when the estate folks had to do without water due to a combination of factors.

“The Mentri Besar was surprised when told that there were still some families who did not have access to piped water. He then visited the estate folks and pledged to look into their problem as soon as possible,” he said.

The affected families recently held a gathering to thank Mohamad for keeping his promise.

Mohamad, who is also Rantau assemblyman, said the estate was among eight that would receive treated water supply under phase one of a project to ensure all residents in the state had access to clean water.

“Several more estates have benefitted from this programme under the first phase. By the time the third phase is completed, all residents in the state will already have access to clean water,” he said adding that at present, there were only some Orang Asli families and those living in faraway places who did not have piped water supply.

Mohamad said there was no reason why the estate folks should not benefit from such government projects especially when they contributed significantly to the nation’s economy and wellbeing.

“The government has already introduced the minimum wage scheme for all workers and this will also benefit estate workers who had long been complaining of insufficient wages,” he said.

He said the state authorities could not do much to provide treated water to the estates previously as it could not trespass estate land to lay the pipes.

“But we engaged the estate owners this time around and they agreed to work with us for the benefit of the estate workers,” he added.

Mohamad also thanked the Federal government for the allocation given for the project through the Human Resources Ministry.

source: http://thestar.com.my/metro/story.asp?file=/2012/10/6/central/12127252&sec=central

Unutilised land to be used for PR1MA project

October 4th, 2012
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 Its a good idea, but the example doesn’t seem right. If an area has been allocated for school, then it most likely means that place needs a school sooner or later. If you built houses there, where would the school be then? Its not only a matter of building houses at any empty land you can find. Have to  do some proper study on traffic load, transportation, etc (in short proper town planning). I hope these kind of stop-gap measures don’t end up creating more problems.

 

Land allocated by the Government but not used for the original purpose will be utilised to build affordable homes for the middle-income group.

Deputy Prime Minister Tan Sri Muhyiddin Yassin also assured the people that houses built on such plots would be priced below RM300,000.

“For instance, plots of land allocated for building schools but not used for that purpose can be developed into a PR1MA projects,” he said during a gathering with Selangor non-governmental organisation youth leaders at Universiti Teknologi Mara here Thursday.

PR1MA (Perumahan Rakyat 1Malaysia) is a government programme to promote greater home ownership, especially among the middle-income earners, by providing more affordable residential properties in major cities nationwide.

source: http://thestar.com.my/news/story.asp?file=/2012/10/4/nation/20121004120552&sec=nation