Loan approval rates for houses below RM500,000 remain stable: BNM

KUALA LUMPUR: Housing loan approval rates for houses costing below RM500,000 have remained stable over the past few years at above 70%, said Bank Negara Malaysia (BNM).
In fact, the approval rate for houses priced less than RM250,000 was higher at 72.7% compared with 67% in 2012, according to BNM's Factwatch.my website.
BNM was responding to an article that quoted the Real Estate and Housing Developers' Association (Rehda) on rejected housing loan applications.
According to Rehda, end-financing remained the main challenge for house buyers to own affordable houses and the highest number of loans rejected were for applications to buy houses costing RM500,000 and below.
Concurring that housing affordability remained a major issue for households in Malaysia, BNM said property developers should work to increase the supply of affordable houses for the people.
"In 2016, house prices in Malaysia were categorised as 'seriously unaffordable' by international standards with a median multiple of five times of annual household income," it noted.
BNM said based on the median multiple approach by Demographia International, houses were deemed unaffordable if the median house price was more than three times the annual median household income. — Bernama