Pros and Cons of Affordable Housing Schemes in Malaysia

·6-min read
Pros and Cons of Affordable Housing Schemes in Malaysia
Pros and Cons of Affordable Housing Schemes in Malaysia

Now more than ever, the cost of living in Malaysia has increased exponentially. Everywhere you look, prices are high – poultry, vegetables, petrol, goods and services, and the property sector is no exception.

Buying a property already takes a heavy financial toll, even more, a home in this economic situation. Coupled with rising property prices and the cost of living, it feels like home ownership is an unreachable dream. Or is it?

Contrary to popular belief, not all homes are beyond your reach. An affordable home is not difficult to find in Malaysia, with housing schemes from the public and private sectors widely available, ranging from full home ownership to rent-to-own programs.

An affordable home that doesn’t completely drain your bank account sounds good, but what’s the catch? Before you start applying for one, make sure you’re well-armed with some good ol’ knowledge about them to safeguard your property interests.

5 Affordable Housing Schemes in Malaysia

In Malaysia, there are five affordable housing initiatives from the government to stimulate property ownership, especially for those in the B40 category.

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Depending on the type of scheme, applicants must follow a set of criteria to be eligible. For instance, they must be Malaysian citizens, own not more than one property, and must fulfil the average monthly household income terms.


Required Average Monthly Household Income

Price of Property

PR1MA (1Malaysia Housing Programme)

RM2,500 – RM15,000

RM100,000 – RM400,000

Residensi Wilayah (a.k.a RUMAWIP)

RM10,000 for individuals, RM15,000 for married couples

RM63,000 – RM300,000


RM3,000 – RM6,000

RM80,000 – RM300,000

Rumah Selangorku

Less than RM10,000


Skim Rumah Pertamaku/My First Home Scheme

RM3,000 – RM6,000

Less than RM500,000

The Benefits Of Affordable Housing Schemes

1. Affordable, hence the name!

First and foremost, affordable housing schemes are affordable, of course. Compared to new housing projects in the Klang Valley and other main cities in Malaysia that typically cost upwards of RM400,000, the homes under these schemes bear an average price tag of about RM300,000 instead.

2. Lowers Homeownership Barrier

The price also lowers the entry barrier for Malaysians to own a home of their own, especially for single adults and members of low-income groups. Married couples can merge their finances for better affordability and a higher budget, but it’s not that easy for singles. Fortunately, with affordable homes, everyone can be a homeowner!

3. Decent-sized Home

And by everyone, we do mean every Malaysian. Whether you’re an accountant in a private company, a teacher in a public school, or a small stall owner, you can own a home. The homes are not studio-small either, especially for high-rise units.

4. Suitable For Young Adults & First-Time Homeowners

Besides that, they also make a good choice for young adults and first-time homeowners as there’s less financial pressure, combined with the freedom of having your own space. An affordable home can teach you the do’s and don’ts about owning a property.

What Are The Disadvantages Of Affordable Housing Schemes

1. Projects Closer to Strategic Locations Costs More

Spread throughout the country in rural areas and the city, there are certain cases whereby the nearer you are to the city centre or a strategic location, the higher the prices will be. Therefore, a home close to a public transport hub might cost more because of the high traffic and convenience the locale brings.

2. Quality of Materials Might Be Lower

Because it’s an affordable home, the keyword is the word ‘affordable’. That means the quality of the materials used, its workmanship, or building infrastructure may not be as good as private developers’. It also means a possible lack of facilities in the building, like a swimming pool, gym, and high-end security systems.

3. Tedious Application Process

The application process for affordable homes can be tedious as well. You must ballot for your preferred development and if chosen, ‘fight’ for a unit or be added to a waiting list. There’s no definite waiting period, but you can apply for other projects, although you’ll be removed from the first waiting list if you’ve been selected for another.

4. Restrictive T&Cs Regarding Sale or Transfer of Property

Once you’ve set your sights on a home, be sure it’s the right choice because you may not be able to sell it for several years! Besides the regular lock-in period in your housing loan agreement, certain affordable housing schemes have a T&C where you are not allowed to sell or transfer the property without prior approval from the relevant bodies.

Advantages of Affordable Housing Schemes

Disadvantages of Affordable Housing Schemes

More affordable compared to private developers’ new projects.

Projects closer to the city/strategic locations can be more expensive.

Lowers the homeownership entry barrier for low-income groups, single adults, and all Malaysians.

The quality of materials may be on the lower end.

Decent-sized homes that are worth the price.

The application process is not easy, and a unit is not promised.

Suitable for young adults and first-time homeowners.

Restrictive T&Cs regarding the sale or transfer of the property.


A Home For Now

When purchasing a home, ambition is great, but purchasing within your means is even better. After all, you can always upgrade your space later on once you’re more financially capable.

[ArticleCallout]{ “title”: “How To Calculate Your Affordability – Now vs Later<br><a href=\u0022\u0022></a>”, “excerpt”: “Purchasing a home is a big decision, so here are things to take note of and calculate how much you can afford!”, “link”: “”, “image”: “×624-crop/static/2020/09/Guideline.png” } [/ArticleCallout]

No matter what your monthly salary is, there’s always a home for you. It doesn’t have to be the newest, coolest project in town, but a home that meets your goals and objectives while effectively providing you with what you need – shelter and private space.

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