A Review on Housing Affordability in Malaysia: Are We Doing Fine?

Mohammad Mujaheed Hassan, Nobaya Ahmad, Ahmad Hariza Hashim
Faculty of Human Ecology, Universiti Putra Malaysia


Housing affordability is continuously a major concern, particularly among individuals residing in the major cities. Housing affordability is measured by two (2) indicators, namely the Median Multiple and Down-Market Penetration. Through the Median Multiple method, the cost of housing median is found to be lower than three (3) times the median household yearly income. Meanwhile, Down-Market Penetration suggests that the minimum cost of the new house, which is set by the private sector without subsidies, is affordable. This article attempts to explore and review the meaning of housing affordability in Malaysia. Reducing the house price, which is the sole method of solving the problem related to the housing affordability issue, is overly emphasised. Instead, more focus should be placed on the addition of supplies and the provision of commodities based on market demand. It should be noted that a more common approach, which includes the method incorporated by the ministries of the government, is crucial to achieving housing affordability.

Keywords: Affordable housing, Affordability, Median multiple, Down-market penetration