KINIBIZ Kuala Lumpur households that earn around RM7,620 a month (the median household income in KL) these days are shockingly unable to comfortably service a house mortgage for a property valued at RM630,000, despite technically being able to qualify for the home loan in the first place.

After some simple calculations and taking into consideration all kinds of basic household expenses, it is estimated that one will be left with about RM194 per month in savings, without even considering much leisurely pursuits.

It is no wonder that this generation has negative savings and is close to being an indebted generation.

Ironically, a household income of RM7,620 a month puts one very near to the top 20 percent of the Malaysian population, at least when going by official definitions. Hence, what can the middle 40 percent and bottom 40 percent of the population expect to make of their wages without being squeezed to their wits’ end?

Median household income for the top 20 percent of Malaysians is at RM9,796, the middle 40 percent RM4,372 and the bottom 40 percent is at RM1,852.

Based on the housing affordability index which measures affordable housing as no more than three times the annual household income, a household which earns RM7,620 a month can supposedly afford houses within the range of RM300,000 to RM400,000.

For the full story go to KINIBIZ .

This article was written by Sherilyn Goh.