Average KL Property Price Stood At RM780,000: How Much Malaysians Need To Afford The Average Home

Recently, there have been calls for more affordable housing in Malaysia amid rising living costs and property prices. While the government is taking initiative to meet the target of 500,000 affordable housing units by 2025 such as through the Madani Youth Housing and Affordable Housing Project in Batu district, some property prices can be high in Kuala Lumpur (KL).   

According to the National Property Information Centre (NAPIC), the average house price in KL stood at RM780,728 in Q22024. Being the capital city of Malaysia, KL offers urbanised living with accessibility to modern infrastructures and facilities, vibrant entertainment scene and economic and business opportunities.  

So, it’s no surprise that some Malaysians choose to work in KL and eventually find that they enjoy living here and decide to buy a home in the city. Among the 13 states and three federal territories in the country, KL is the most densely populated city, with more than 8,000 individuals per sq km. With a larger demand for housing in KL, property prices in the city can be pricier compared to in other states.  

With that, one may wonder how much they need to earn to afford the average home in KL. 

Income You Need To Buy The Average Home In KL 

A general rule of thumb for buying a home is that one should allocate not more than 30% to 35% of their monthly income to their mortgage. 

For this article, we take the prudent approach of allocating around 25% to 30% of their income for mortgage payments. 

Aside from this, we assume that homebuyers pay the minimum downpayment of 10% for the home. They will also take a 35-year home loan tenure with an interest rate of 4%. 

The following table shows the average price of homes in KL and how much you need to earn to afford the homes.  To be able to afford the average house price in KL of RM780,728, one will need a monthly income of around RM11,000 to RM13,000. 

In addition, we can also look at the average price of different types of residential homes in KL and how much you need to earn to afford them. 

One of the more popular types of homes in Malaysia is terraced homes also known as landed homes. Homebuyers who are seeking a larger space, privacy and living in a suburban environment would prefer living in terraced homes. However, as space in KL city centre for building homes becomes limited over time, there are not many new landed home projects in KL city centre and they can be quite expensive.  

Based on NAPIC’s data, the average price of a terraced home in KL was RM937,267 in Q22024. Homebuyers will need to earn a monthly income of around RM13,000 to RM16,000 to afford the average price of a terraced house in KL. 

Another common type of residential home is high-rise properties such as condominiums, apartments and serviced residences. The average price of high-rise residential properties in KL was RM529,807. Homebuyers will need an income of between RM7,500 to RM9,000 to own the average high-rise residential property.       

Additionally, some homeowners with larger budgets may be looking for semi-detached homes, which are landed homes that are partially separated from neighbouring units, offering even more privacy. These properties may also come with private outdoor space which they can use for gardening.

The average price of semi-detached homes in KL stood at RM2,430,782. Homeowners will require a monthly income of around RM34,000 to RM41,000 to afford an average semi-detached home in KL.

Other Financial Costs Of Owning A Home  

As we can see, property prices in KL can be quite high. The property prices in the country are expected to further increase by 2% to 5% in 2025 on the back of strong local demand and rising construction costs.  

While the general rule of thumb dictates that one should not spend more than 30% to 35% of their salary on mortgage, it’s wise to determine how much you should spend on mortgage yourself based on your own financial situation. 

Aside from mortgage repayments, we also need to bear other expenses that come with home ownership. For starters, we need to put down an initial downpayment that’s typically 10% of the property price. Then, we need to also pay legal fees and stamp duty for loan agreement and sale and purchase agreement (SPA). S0tamp duty fee for loan agreements is typically fixed at 0.5% of property price. Then, there is also stamp duty for the SPA, which ranges from 1% to 4% of property price. 

After getting the keys to your house, you may also need to prepare funds for furnishing or renovating your home. There are also recurring costs you need to consider such as maintenance fees and property taxes. In KL, homeowners pay assessment rates also known as ”cukai taksiran” in the Malay language to the local council Kuala Lumpur City Hall. This is to cover the maintenance work the local council does such as waste collection and streetlight repairing. 

Read Also: Work In KL, But Retire In ”Cheaper” States: 5 States That Malaysians Can Move To For A Lower Cost Of Living 

Follow Us On Telegram & Instagram!

Join our Malaysia Telegram channel (@dollarsandsensemy) and follow our Malaysia Instagram Page (@dnsmalaysia) as we bring you the latest finance content in Malaysia!