A local data analytics site that specialises in real estate research recently shared a heat map of Klang Valley depicting how much home buyers need to earn a month to afford a home in the area
In a tweet on Thursday, 11 November, Crib shared a photo filled with hexagons covering different areas in Klang Valley.
"This is how much you need to earn to buy a house based on location," the firm wrote.
"You definitely need at least [RM10,000] to buy a house in KL city centre, (such as) Mont Kiara, Hartamas, Ampang Hilir, and Damansara Heights."
"For [RM6,000 to RM10,000] earners, they can find home in Subang Jaya, parts of Petaling Jaya, Puchong, Glenmarie, Cheras, Wangsa Maju, Sentul, Sungai Buloh, et cetera..."
When asked about the area between the south of Bandar Botanic, Klang and north of Telok Panglima Garang, Kuala Langat where home buyers need to make at least RM26,673 to own a property there — the highest requirement in Klang Valley — Crib founder Faizal Kadir told SAYS that it is likely because of the presence of high-value bungalows in the area.
The analysis is based on house transaction data in 2020, and includes both landed residential properties and high-rise residential properties.
Meanwhile, the area around Damansara Heights and Mont Kiara is the most expensive area in Kuala Lumpur, as home buyers need to make at least RM19,533 to afford a residential property
On Crib's website, there are six areas where the median prices of residential property are beyond RM1 million and can go up to RM30 million.
"Median prices for Bangsar, Taman Tun Dr Ismail, Sri Hartamas, Bukit Damansara, Ampang Hilir, and Elmina are over RM1 million. These areas are predominantly landed property, except for Ampang Hilir, where you can see more strata houses, and the cost of buying a link house is at least RM1 million," it explains.
Strata houses refer to landed houses that come equipped with condo-style facilities, such as a swimming pool and gym.
"In the surrounding of these high-end areas, you can find houses in the lower range from RM500,000 to RM1 million," it continues.
"Mont Kiara and Desa ParkCity, [which] also can be categorised as high-end neighbourhoods, are selling for a median price of RM780,000 and RM900,000 respectively. KLCC city centre, which is one of the most desirable places to own a house, recorded a lower median price because of smaller serviced apartment units and flats that weigh the price down."
In the geospatial data below, the monthly salary home buyers need to make to afford a house is calculated based on the common practice that the monthly instalment is one-third of the person's income
According to Crib, the methodology to set a figure for each area is based on a calculated assumption that home buyers buy the house with a mortgage that pays 90% of the house value.
"We calculate the instalment based [on] 90% financing from the 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 one-third of income," it explained.
Below is a video showing different geospatial data sets as illustrated by Crib: