Median House Price And Expected Salary Needed to Buy A House In Klang Valley
Klang Valley represents more than half of house sale in the country. It is consist of 3 states Kuala Lumpur, Selangor and Putrajaya. it is the heartland of Malaysia's economy and home to roughly 8 million people.
In this article, we are using 2020 house transaction data for our analysis an we include both landed residential property and highrise residential property.
In order to make clearer comparison, we break Klang Valley information equal unit of hexagons with 2KM radius. Then we find each geolocation each house transaction map it to polygon that they belong and group them for further analysis.
Median prices for for Bangsar, Taman Tun Dr Ismail, Sri Hartamas, Bukit Damansara, Ampang Hilir and Elmina are over RM 1 million. These areas are predominantly landed property except for Ampang Hilir where you can see more strata house and the cost of buying link house is at least RM1 million. In the surrounding of these high-end area you can find houses in the lower range from RM 500,000 to RM 1 million. Mont Kiara and Desa Park City that also can be categorized as high-end neigborhood are selling for median price of RM 780,000and RM 900,000 respectively. KLCC city center which is one the most desirable place to own a house, recorded a lower median price because of smaller serviced apartment units and flatS that weigh the price down.
So how much you need to earn to buy a house?
Assuming that buyers will buy the house with mortgage that pays 90% of house value, we calculate the instalment based 90% financing from median price of each hexagon using 30 years loan period at 3.5% interest rate per annum compounding monthly. In order to be prudent we use the rule that instalment is 1/3 of income.
If you want to buy a house close to city center, it is a good chance that you need to earn more than RM10,000. In general, the further from Kuala Lumpur city center the cheaper the property price.
Please contact us if you need further and deeper analysis