Much has been said about the high cost of buying a property in Malaysia. The question is whether this is happening in Malaysia only or is it a global trend?
Let’s draw a comparison with a few neighbouring countries.
In Jakarta, a fresh graduate earns about 3.5 million rupiah (RM1,000) and a 1,000 sq ft middle class apartment will cost around 2.5 billion rupiah (RM700,000). A fresh graduate in Ho Chi Minh City earns about 5 million dong (RM900) and a 1,000 sq ft apartment price is around RM600,000.
In Kuala Lumpur, fresh graduates earn about RM2,500 while a 1,000 sq ft apartment costs around RM500,000.
If young Malaysians are complaining that the property price is high, they are indeed not wrong if they were to compare it during the baby boomers era when the salary of fresh graduates was RM1,000 and said property price was RM35,000. But looking at the peers from the two comparisons, we are in a better state!
So what went wrong and what do we expect to happen?
Do we expect land price, construction or labour costs to go down?