Looking At the Homeless Generationby Boo Su-Lyn
”I think we are heading to just renting for life... would be nice if I can afford one without a 30- year loan or to have my next generation pay it off,” she added.
Liow’s problem is typical of her generation’s, as people in their 20s and 30s are forced to continue staying with their parents instead of paying expensive rent.
Chang Kim Loong, honorary secretary-general of the National House Buyers Association (HBA), said that the average price of a condominium unit in the Klang Valley is RM500,000, noting that one needed to have a five-figure monthly household income of between RM10,417 and RM13,889 to afford such properties.
”Affordable” and “moderately unaffordable” homes are defined as costing below three times, and between 3.1 and 4.0 times one’s annual household income respectively, according to the housing affordability rating recommended by the World Bank and the United Nations.
”In an ideal world, we should be buying at properties deemed as ‘affordable’, which is up to 3.0 times the annual household income. However, that could be challenging and HBA would recommend that aspiring house buyers buy something that is higher than ‘moderately unaffordable’,” Chang said in a recent email interview.
He also pointed out that based on the average monthly household income in Kuala Lumpur (KL) and Selangor—which are RM8,586 and RM7,023 respectively, according to the Department of Statistics—people can only afford to buy homes costing between RM309,096 and RM412,128 in KL; and between RM252,828 and RM337,104 in Selangor.
”When was the last time you saw a new property with a KL address...(or a) Selangor address launched at the above prices?” questioned Chang.
Chang also noted that the average monthly household income in KL and Selangor is calculated based on earnings from two working spouses.
”That would mean that single people would never be able to afford to buy their own properties, thus compounding the risk of a homeless generation,” he said.
However, even with a combined income, some married couples cannot afford to move out and start their new life together.
”Then they realise, to stay in this area, this is the price you have to pay. So, it’s not true to say that property is not affordable for the young,” added Chew. “When you talk about property not affordable, yes, for PJ and KL. But if you go to Semenyih, Kajang, I believe those properties are affordable.”
They say that property prices nowadays are “crazily inflated” and “absolutely ridiculous”, stressing that purchasing a home in distant locations will only raise transport costs and isolate them from friends and family.
Living in KL or PJ should not be a luxury, the young adults maintain, as it is not prestigious addresses that they are looking at, merely “decent” homes. Their desire to stay close to the city centre, however, appears to be influenced by other lifestyle choices, such as sipping an RM10 latte at an indie cafe in Bangsar over the weekend, owning a smartphone, or driving a foreign car.