Home prices in six states severely unaffordable

Residential properties in Sabah cost 11.41 times a family’s median annual income, making them the most expensive homes in Malaysia, according to Institut Rakyat, a think tank run by Pakatan Rakyat.

Based on the federal government’s data for Q4 2012, houses in Sabah were pricier the than the national average of RM251,731, said Institut Rakyat’s Executive Director Yin Shao Loong,

The next most unaffordable residential properties are found in Sarawak (9.04 times) due to a huge gap between home prices and annual household income. For instance, the average price of houses in Sarawak is RM330,594, but the median income of a family is merely RM36,564.

“Sabah and Sarawak suffer from a combination of weak household incomes and house prices that are far higher than the national average, with average prices comparable to Selangor,” he explained

The third most expensive place for houses is Kuala Lumpur (8.22), where the average price of such properties stands at RM576,991, but the annual median income is only RM70,164.

The capital is followed by Selangor (5.88), Penang (5.83), and Kelantan (5.54), but home prices in all the six aforementioned states are considered as severely unaffordable.

On the other hand, residential prices at Terengganu (4.93), Pahang (4.84 times), Perak (4.67), Kedah (4.40), Perlis (4.37), and Johor (4.20) were categorised as seriously unaffordable

Only Negeri Sembilan (3.71) and Malacca (3.16) were deemed as moderately unaffordable. “However, average house prices for these states still exceeded three times the annual income of each state’s median household,” Yin noted.

For middle-income families, they can only afford residential properties priced at RM153,000 and below, he added.